Articles

Does a Right to Physical Hearing Exists in International Arbitration? - Hungarian Country Report

Richard Schmidt

The coronavirus affects every branch of the law, and international arbitration is not an exception. To preserve rapidity, as one of the most important advantages of arbitration in comparison with state court litigation, remote hearings or e-hearings become more and more crucial in arbitral proceedings, yet their legality is not unequivocal in every jurisdiction. This is the reason why the International Council for Commercial Arbitration decided to launch a project in September 2020 with the following title: Does a Right to a Physical Hearing Exist in International Arbitration?

Read More Download

Hungary: Enforcing Arbitration Agreements by Applying Foreign Law

Richard Schmidt

Conflict of laws issues can have a pivotal effect on the effectiveness of arbitration when state courts are asked to enforce arbitration agreements. Has the approach of Hungarian courts crystalized in the last years in this respect? Can the contemporary Hungarian judicial practice and the new domestic legislation be characterized as arbitration friendly? This post provides the answers to these questions.

Read More Download

Hungary: Setting Aside Arbitral Awards in the Last 25 Years – A Pro-Arbitration Approach with Minor Derailments

Richard Schmidt

Two and a half decades have passed since Hungary harmonised its arbitration law with UNCITRAL Model Law (‘Model Law’) in 1994. This marked a giant leap forward, especially as the adopted provisions were made applicable not only in international, but in purely domestic arbitrations as well. This post analyses the Hungarian case law on setting aside procedures that has been produced since the country adhered to the Model Law. As will be shown by examining the standard of review and the selected grounds of annulment set forth by Article 34 of the Model Law (adopted verbatim in Hungary), apart from some judicial decisions that were rather exceptions than the rule, the Hungarian courts have usually adopted a pro-arbitration approach in the last 25 years.

Read More Download

Hungary: Steps Towards Differentiating Between Domestic and International Procedural Public Policy

Richard Schmidt

Drawing a well-defined line of demarcation between domestic and international public policy when enforcing foreign arbitral awards sends a clear pro-arbitration message from national courts in any jurisdiction. Does Hungarian case law come close to this level of sophistication? This post analyses this question in the context of procedural public policy, and it does so based on two recent appellate court decisions rendered in the context of enforcement of arbitral awards in accordance with the New York Convention.

Read More Download

Setting Aside Arbitral Awards in the Last 25 Years in Hungary – A Pro-Arbitration Approach with Minor Derailments

Richard Schmidt

Is Hungary a pro-arbitration jurisdiction? The UNCITRAL Model Law[1] (“Model Law”) has recently celebrated its 25th anniversary in Hungary, so the time is ripe to assess the case law of Hungarian courts from the last two and a half decades in the field of setting aside arbitral awards to answer the above question. Besides this “silver jubilee”, justifying the retrospection in itself, the reveiw of leading Supreme Court[2] decisions in this domain is also useful due to a recent legislative change, since from 1st April of 2020, the lawmaker introduced the so-called “limited precedent system” in Hungary, based on which all Supreme Court decisions have binding effect on lower courts.[3] This legislative reform, marking a milestone in the development of Hungarian law belonging to the Romano-Germanic legal family, can be interpreted as a shift from the traditional Roman law principle of “praetor ius dicere potest, ius facere non potest”, towards common law, where the existence of judge-made law is widely accepted. Therefore, in addition to the celebration of the first quarter century of the Model Law in Hungary, practical considerations also justify a short time travel to the past, to overview the landmark decisions of the Hungarian Supreme Court in relation with the annulment of arbitral awards.

Read More Download

The New York Convention in the Hungarian Court Practice in Two Decades - Formalistic Yet Pro-Arbitration Approach?

Richard Schmidt

This post analyses the decisions of Hungarian courts, rendered under the New York Convention (“Convention”) and published in the last two decades. The decisions were initially made available to the international arbitration community in the ICCA Yearbook of Commercial Arbitration series. This case law of 20 years is summarized below by identifying the main directions of the application of the Convention in Hungary.

Read More Download