BUDAPEST Hungary's top court ruled on Monday that legislation mandating a lower retirement age for judges was unconstitutional as it threatened the independence of the judiciary, echoing criticism by the European Union.
The Budapest government had been at loggerheads with Brussels over a series of new laws passed last year that critics said cemented the ruling conservative Fidesz party's hold over independent institutions in the central European state.
The European Commission launched legal action, a so-called "infringement procedure", against Hungary in January over new laws affecting its central bank, the retirement age of judges and the independence of the data-protection authority.
Hungary's Constitutional Court said on Monday it had annulled parts of the law, applied retroactively to January 1, 2012, dealing with retirement of judges which it deemed unconstitutional.
The law, which reduced the retirement age for judges from 70 years to 62 years, forced into sudden retirement hundreds of judges in a way which Brussels has said violated EU laws.
"The Court ruled that the new regulation, both formally and from the aspect of content, breached the constitutional requirements stemming from the independence of judges," the Hungarian court said.
The court said while the creator of the legislation was free to define the upper age for service of judges, any new lower mandatory retirement age could be introduced only gradually over an appropriate transitional period.
In April Brussels decided to take the case before the European Court of Justice, asking for an expedited procedure as the law could affect 236 judges in Hungary this year alone.
The European Commission also said it had concerns about the independence of the judiciary in Hungary and reserved the right to launch infringement proceedings if Hungary did not meet Brussels' requests. It had closed the procedure regarding the central bank legislation earlier this month.
The ruling on Monday was seen as a political blow to Prime Minister Viktor Orban's government on the eve of talks on a financing backstop with the International Monetary Fund and EU.
The retirement law has been one of the flagship measures of the government as it reforms all public institutions in Hungary using its two-thirds parliamentary mandate gained in April 2010.
"This is definitely unpleasant for the government as it has had a very consistent stance on this issue ... and has said that in legal terms the new rules were all right," said Attila Juhasz, analyst at think tank Political Capital.
"It's a slap in the face."
(Reporting by Krisztina Than; Editing by Mark Heinrich)