Similar to creating a company, closing a company is also a legal procedure at the Company Court. You will need professional help in this issue: a lawyer and an accountant. In this short article we summarise the legal aspects of the winding up procedure.
There are times when you reach a point when you decide it is better to finish your business in Hungary e.g. if you have a non-prospering company without perspectives. However, the situation is not so simple, and leaving the company behind may be risky. In this short article we summarise the legal aspects of company shutdown which is worth to read if you considering closing the company.
In some cases, setting up a supervisory board is mandatory. Its main function is to control the management and the managing directors of the company. In this article, we will summarise the most important rules concerning the supervisory board and its importance for deciding whether we need one in a Hungarian LLC.
In most cases the shareholders of a limited-liability company (LLC) will not be liable for the debts of the company with their own assets. However, there are situations, when the rule of limited liability shall not prevail and under special conditions, the shareholder of a terminated LLC will be directly and unlimitedly liable for the company’s debts. In this short article we summarize the most important cases when the limited liability becomes unlimited.
Signing a contract or making a statement on behalf of a company is a common task in business. During this "routine" process, parties often do not check whether the signatory of the other party can represent the company. Is a contract valid in Hungary if the signatory has no or limited signing authority? Who, what and from whom can claim in such a case? In this article you will find the answers to these questions.
Doing business also means a lot of paperwork. When signing company document in Hungary, it is important that the signature should not have any fault, because it may result in an invalid document, and can cause a loss of time and money. To avoid wasting time and money for administrative mistakes, read the 4 must-knows we gathered in this article.
From 1st July 2023, a new law on the registry of legal persons, including companies and civil law organisations (“Registration Act”) will enter into force in Hungary. What are the key features of the new law? Will it be possible to register a company within 1 hour in Hungary from July 2023? This article highlights the major changes that the Registration Act will introduce.
The „start-up capital” of the limited liability company (LLC) is the initial capital which is the totality of the capital contributions provided by the shareholders. In this article we will examine the rules on the capital contribution.
In this article we summarize the key-points of the limited liability company (LLC) formation in Hungary. By presenting the main features of the Hungarian LLC, we show why it is the favourite company form among foreign investors.
Finding the most appropriate company form is essential for every business. Hungarian company law offers a wide range of company forms available for foreign entrepreneurs and investors. We prepared this summary to help you to find the form that mostly fits your business goals.
Hungary is a popular target for investing in the Central Eastern European region thanks to the 9% tax on capital gains for SMEs and 15% personal income tax for individuals, which tax rates are among the lowest for both businesses and private individuals across Europe. However, there are extra requirements for foreigners that are important to pay attention to. In order to avoid unpleasant surprises, we would like to draw your attention to the following when you are setting up your company in Hungary as a foreigner.
For companies operating internationally or with foreign background, it is common to work with documents in a foreign language and to sign corporate documents and contracts abroad. Although it is insignificant in the daily life of a company, the situation is different if you want to use a document signed abroad or in foreign language in a litigation or in other legal proceedings, as the foreign document has to comply with special rules. In our short article we will summarize what should you consider if you want to use foreign documents before the Hungarian authorities.
In business, signing a contract or making a declaration on behalf of a company is daily task. During this “routine” process, the parties often do not check whether the signatory of the other party can represent the company. Is the contract valid in Hungary if the signatory has no signing authority, or it is limited? Who, what and from whom can claim in such a case? In our article, you will find the answers to these questions.
In May 2019 the European Court of Justice condemned again the Hungarian Land Act of 2014 cancelling usufructs on arable lands in Hungary without providing any compensation for right-holders. What is the “added value” of this second judgment, and why it is important for investors seeking damages for losing usufructs on lands?
On 1st January 2019 the Act on the Control of Investments Detrimental to the Interests of Hungarian National Security entered into force. On the basis of the new law investors who are considered as “foreign” have to report their newly acquired interest in Hungarian companies. Pursuant to the Act, the Minister of the Interior may prohibit the acquisition or may withdraw the right of the company to pursue a certain activity. In our article, we summarize the most important information regarding the new law.
Businesses come, businesses go, and there are times when you reach a point when you decide it is better to finish your business in Hungary. Similar to creating a company, closing a company is also a legal procedure at the court of registration. You will need professional help in this issue: a lawyer and an accountant. Let’s see how it goes.
In legal texts you can see different terms referring to a company’s address: seat, place of business, premises, branch office, etc. Usually it is very hard to make differences from the context, and some of them seem to mean the same, because the most of the texts don’t tell you a definition. We will. Let’s see, what these words actually mean in Hungary.
The transfer of business shares in Hungarian Limited Liability Companies is an under-regulated domain of Hungarian company law, however there are some “opt-out” and “opt-in” restrictions that shareholders should bear in mind if they want to set up a working shareholders’ structure. We summarise the must-knows of this topic in this article.
Many are already familiar with the so called client gate and use it on a daily basis, it may be new that now the companies are required to register their own “gates” called company gate. The registration portal is already available and companies are obliged to make the registration until 30th August 2017. However, a grace period until the end of this year is provided and until this date companies can live a gate-free life. After 1st January 2018 those companies who have not entered the gate can expect sanctions. In this short article, we tell you what exactly is the company gate and how you can make the registration.
Doing business also means a lot of paper work. When signing company document in Hungary, it is important that the signature should not have any fault, because it may result in an invalid document, and can cause a loss of time and money. To avoid wasting time and money for administrative mistakes, read the must-knows we gathered in this article.
If you want to use an apartment or flat as a seat of your company in Hungary you have more options, but be aware: the authority regularly checks the legal basis of the use of the company’s seat. At the same time, the careful planning of the use of company seat may help you to optimize your tax, so let’s see what kind of legal opportunities you have when you want to legally use your company seat.
Creating a company in Hungary became very convenient and fast nowadays. However, there are some extra requirements for foreigners that can make this simple procedure longer and problematic, especially in the field of official documents issued and/or signed abroad. To avoid unpleasant surprises, we tell you the four most important thing you need to keep in mind as a foreigner when setting up your company in Hungary.
When planning to establish a company in Hungary, the corporate name is always a crucial question. We know that it is hard to come up with a good idea that fits your style and the goal of the organization. Yet, all that effort is just a waste of time, if the name does not comply with the requirements of Hungarian law. So we share the most important points to keep in mind when thinking about a company name.
As a foreign company who plans to do business in Hungary, it sounds a great idea to open a Hungarian branch office. The main reason for this is that you do not need to provide the minimum capital contribution. Even if at first glance, opening a branch office seems simpler and cheaper than founding a Hungarian LLC as subsidiary, yet there are strong reasons to do the latter. In these article we share with you these considerations.
Many believe that as a shareholder of a limited-liability company they will not be liable for the debts of the company with their own assets. In most cases this is true, yet there are situations, when the rule of limited liability shall not prevail and the shareholder of the LLC will be directly and unlimitedly liable for the company’s debts. In this short article we summarize the most important cases when the limited liability becomes unlimited.
Under special conditions, the shareholder of a terminated LLC will be directly and unlimitedly liable for the company’s debts. You might think that your debt recovery problem is then solved: if the debtor company is terminated, you will sue the shareholder. However, the devil is always in the details and certain conditions must be met in order to turn successfully against the shareholder. In this short article we tell you 4 things that you need to know if you decide to sue the shareholder of a terminated LLC in Hungary.
Imagine the situation that you have a non-prospering company without perspectives. The mass of non-paid invoices is just bigger and your company cannot pay taxes. In this case the best option just to shut down the company and say goodbye to Hungary thinking that you are not liable for your company’s debts. However, the situation is not so simple, and leaving just the company behind may be risky. In this short summary we summarise the legal aspects of company shutdown which is worth to read before the “close-shop”.
A minority shareholder often finds it hard to protect his interest without real decision-making power in the shareholders’ meeting. At the same time Hungarian company law offers a wide range of protective measures that every minority shareholder should know inside and out, in order to effectively safeguard its investment. We summarise these legal tools in this article.
The transfer of business shares in Hungarian Limited Liability Companies is an under-regulated domain of Hungarian company law, however there are some “opt-out” and “opt-in” restrictions that shareholders should bear in mind if they want to set up a working shareholders’ structure. We summarise the must-knows of this topic in this article.
In this article we summarize the key-points of the limited liability company (LLC) formation in Hungary according to New Hungarian Civil Code. By presenting the main features of the Hungarian LLC, we show why it is the favourite company form among foreign investors, and after we outline the most important steps and costs of the company formation procedure.
Becoming an authorised economic operator (AEO) in the European Union is an outstanding opportunity for international traders to make their import - export administration faster, more convenient and to reduce the custom clearance related costs. We present the main features of AEO status by answering the most frequently asked questions about this topic.
Finding the most appropriate company form is essential for every business. Hungarian company law offers a wide range of company forms available for foreign entrepreneurs and investors. We prepared this summary to help you to find the form that mostly fits your business goals.