(Bloomberg) -- The European Union is finalizing a decision to release as much as €1 billion ($1.1 billion) in EU funds for Hungary just as Prime Minister Viktor Orban is stepping up his attacks against the bloc and threatens to derail aid to Ukraine.

The European Commission, the EU’s executive arm, is concluding its assessment of Budapest’s amended post-pandemic recovery plan to address the energy crunch triggered by Russia’s invasion of Ukraine, according to people familiar with the matter. 

Once the expected decision is approved by EU finance ministers, the Hungarian government could access as much as 20% of the additional €3.9 billion in loans and €700 million in grants requested to finance its REPowerEU chapter, the people said. They asked not to be named because the talks are private. The amount of funds released would likely amount to €920 million.

A spokesperson for the EU’s executive didn’t immediately respond to a request for comment. 

The forint rose 0.4% against the euro on Thursday morning, the second-biggest gain among emerging-market currencies tracked by Bloomberg, after having depreciated for much of the past week. 

Even when the non-conditional pre-payment goes through, the release of a much bigger portion of blocked funds remains contingent on other conditions including judiciary reform, the fight against corruption and the strengthening of audit and control systems.

The relationship with the EU remains fraught after Orban launched a billboard campaign portraying European Commission President Ursula von der Leyen as a puppet of Alex Soros, the son of Hungarian-born US financier George Soros. Hungary’s prime minister is also seeking sweeping powers to root out what his proposed legislation describes as foreign efforts to influence politics.

The commission is assessing the scope, competences and implications of the proposed Sovereign Protection Agency, the people said. 

Orban also continues to question some of the bloc’s decisions on migration and has called for a comprehensive discussion about the effectiveness and sustainability of the EU’s existing strategy toward Ukraine, which he has described as ineffective, they said.

The commission’s approval would come against the backdrop of a long-running legal battle over Hungary’s democratic backsliding. The EU last year suspended more than $30 billion of Budapest’s funding due to rule of law and graft concerns, money that Orban is seeking to access after a prolonged recession and a budget crunch.

Around €13 billion euros of the funds suspended over concerns about the independence of judges may still be unlocked by the end of the year, the people said. The EU’s executive and the government in Brussels are discussing the details and the implementation of a judicial reform approved early this year.

--With assistance from Zoltan Simon.

(Updates with currency move in fifth paragraph and more detail throughout.)

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