The European Commission has launched the bloc’s new rule-of-law disciplinary procedure for the first time against Hungary, two days after nationalist prime minister, Viktor Orbán, won a fourth landslide victory in parliamentary elections. Ursula von der Leyen, the commission president, told the European parliament on Tuesday that Budapest had been informed of the decision and “we will now send the letter of formal notification to start the conditionality mechanism”. The untested mechanism, designed to prevent EU funds from being misused by countries backsliding on the rule of law, was agreed by all 27 EU leaders in late 2020 and could ultimately deprive Budapest of more than €40bn of EU payments. “It’s happening. Finally!” tweeted the German Green MEP Daniel Freund, a vocal critic of Orbán and of the commission’s reluctance to act on his democratic backsliding. Von de Leyen in particular had been accused of dragging her feet on the issue. The move followed shock in Brussels after Orbán hit out at “opponents” – including “Brussels bureaucrats” but also Ukraine’s president, Volodymyr Zelenskiy – in his victory speech, hours after horrific images emerged of atrocities in Bucha, near Kyiv. Few in the EU offered their congratulations after the Hungarian prime minister’s win, which followed years of criticism he was undercutting liberal democratic rights and values, and accusations that he was using funds from the bloc to enrich his associates. The Russian leader, Vladimir Putin, however, offered his congratulations to Orbán, a long-term Kremlin ally, on Monday, saying the “further development of a bilateral partnership fully accords to the interests of the peoples of Russia and Hungary”. Prominent anti-EU politicians including Britain’s Nigel Farage, France’s Marine Le Pen and Italy’s Matteo Salvini were also quick to congratulate Orbán. “When the people vote, the people win,” tweeted Le Pen. Even if it takes time to finalise internal work on the sanction, critics of the Orbán regime have said the commission’s decision alone could have a rapid impact, making it harder for Budapest to borrow money, for example. Orbán, in power since 2010, has tightened the noose around academics, NGOs and the media, as well as restricting the freedoms of migrants and gay people. There have also been multiple allegations of EU funds being diverted to Orbán’s friends and family. The European court of justice last month dismissed complaints about the mechanism from Hungary and Poland, whose ruling Law and Justice party is in a long-running battle with Brussels over judicial independence, increasing pressure on the commission to act. In a milestone in the battle for the rule of law in the EU, the bloc’s highest court rejected the countries’ cases “in their entirety”, confirming that EU member states can be deprived of EU funds when they fail to meet democratic standards. The EU’s values, such as the rule of law, “define the very identity of the European Union as a legal order”, the court said. “Compliance with those values cannot be reduced to an obligation which a candidate state must meet in order to accede to the European Union and which it may disregard after accession.” The law is intended to protect from fraud against the EU budget, rather than all rule-of-law violations. It won strong backing from governments in western Europe that are net payers into the EU budget. But it was criticised by Hungary and Poland, both net recipients of EU funds, who have received billions of euros since joining the bloc in 2004 to improve public infrastructure, fund universities and support farmers.