The European Union threatened Hungary with legal action on Wednesday over moves by Prime Minister Viktor Orban to shut down a university that the bloc fears run counter to its values on rights and democracy.
The EU is concerned by a new Hungarian education bill that could shut down the respected Central European University (CEU), which was founded by Hungarian-born billionaire George Soros in the 1990s.
The EU executive's deputy head said Orban's government needed to assuage the bloc's worries by engaging in a political dialogue with the European Commission, which is also trying to persuade Orban's right-wing allies in the Polish government to amend plans for constitutional changes there.
"Taken cumulatively, the overall situation in Hungary is a cause of concern," First Vice President of the European Commission Frans Timmermans said in a news conference while questioning the compatibility of the rule with EU law.
We will complete a thorough legal assessment of the Higher Education Law as soon as possible, and consider next steps by the end of April
— Frans Timmermans (@TimmermansEU) April 12, 2017
Controversial law sparks protests
Hungary approved the controversial law on Monday despite protests at home and abroad.
The university said late on Monday that it would take legal action against the bill, calling it "discriminatory".
The English-language CEU was founded to help the region's transition from communism to democracy.
The new rules bar institutions based outside the European Union from awarding Hungarian diplomas without an agreement between national governments.
They will also be required to have a campus and faculties in their home country - conditions not met by the CEU, which is registered in the United States.
The US has called for the proposal to be withdrawn. An open letter signed by over 900 academics around the world, including 18 Nobel prize-winning economists, was also sent.
The law stipulated that the CEU viewed as a bastion of independent thinking in eastern Europe, must open a branch in its home state of New York alongside its campus in Budapest and secure a bilateral agreement of support from the US government - a rule the US doesn't support.
Hungary mellows out
Hungary said on Wednesday there was a way for the university to continue operations following protests.
Education Secretary Laszlo Palkovics told the news web site HVG.hu on Wednesday that the CEU could issue diplomas if it extended a licence agreement with its Hungarian sister school to teach its courses.
Government spokesman Zoltan Kovacs said the government would not suspend the disputed law but added: "We are going to have talks with everyone; if the Soros university is driven by good intentions, it will be able to solve the problem."
Brussels also expressed concerned on Wednesday at new Hungarian laws, saying it fears they may curtail freedoms and contradict asylum rules.
The EU stepped up pressure on Poland and Hungary to take in asylum seekers under the bloc's migration plan or risk legal action if their reluctant governments refuse.