In early January 2024, many managing directors in Hungary of companies with any agriculture-related activity could be surprised to receive a letter of the Hungarian Chamber of Agriculture stating that the company has become a member of the Chamber by law from 1st January. What does this chamber do, and what are the main consequences of the membership? Why it is worth to consider an opt-out from the Chamber? In this article, we address these issues.
While the reviewing of questions of law by higher courts is generally permitted at the judicial remedy stages of civil litigation in Hungary, questions of fact, and the free deliberation of evidence, can only be reviewed exceptionally by the Hungarian Supreme Court under well settled case law. Is this rule also applicable under the new Civil Procedure Code? This article answers this question by analysing the recent judgment of the Supreme Court in a case concerning the impacts of covid-19 on the Hungarian phase of the Giro d'Italia cycling race.
In its recent decision, the Hungarian Supreme Court examined whether liquidation proceedings can be started against a debtor who received online invoices via email and failed to pay them. Is the principle of free evaluation of evidence in civil litigation also valid in insolvency proceedings in Hungary? Are contract provisions relating to the service of contractual notices applicable in such cases? This article analyses the decision and answers the above questions
Under what conditions can a minority shareholder sue the managing director on behalf of the company if the majority of shareholders do not support the motion? Should these conditions be interpreted restrictively or broadly? This article analyses the above questions in the context of a recent Supreme Court judgment.
The Supreme Court recently ruled in the case of a British Academy of Film and Television Arts award-winning composer who sued a French company in Hungary because of the illegal use of his music in video games distributed on online platforms. Besides the issue of the Hungarian courts' jurisdiction on a matter involving a foreign defendant and international copyright infringements, the other issue was whether the original licence granted by the claimant covered these different modes of exploitation.
Can the shareholder of a company assert claim on its own right against a third-party causing damage to the company, by contending that the damage suffered by the company has also decreased the value of its share? To what extent can the right to access to court limited in the name of the sound administration of justice? We address these questions by analysing a recent judgment of the Hungarian Supreme Court.
This article analyses a recent Supreme Court decision(1) and seeks to answer the following questions: - Can a defendant which is domiciled abroad be sued in Hungary under the EU Brussels Recast Regulation (1215/2012/EU) in the event of defective performance of an international sales contract if the place of performance is abroad? - Can the jurisdiction of a Hungarian court be established based on the fact that a lower court expressly established its jurisdiction at the beginning of the litigation? - How is the Ex Works (EXW) clause to be interpreted within the meaning of the EU Brussels I Regulation?
The Supreme Court recently concluded that the res judicata effect of a final judgment precludes the claimant from starting new litigation on the same legal grounds for a part of the claim which was not sought in the preceding lawsuit. This article answers the following questions: - Is this judgment reconcilable with case law? - How will this judgment affect party autonomy in civil litigation? - How will this judgment affect test cases in Hungary?
Can parties stipulate in a commercial lease that a user charge amounting to three times the monthly rent will apply if the lessee fails to vacate the leased premises? Further, can a judge qualify such an excessive fee as a penalty which the court can reduce? This article analyses a recent Supreme Court decision in order to address these questions.
After the bill, passed in 2018 on restrictions of foreign investments, Hungary further limits the domestic investments of the foreigners because of the COVID-19. The new decree extends the scope of the investments to be notified and introduces fines, too. We explain the most important provisions of the decree in this article.
Measures taken due to the corona virus in recent weeks in Hungary affected the enforcement of securities over real estate, as well. The Governmental Decree regarding this matter provides more assistance to the Debtors who got into trouble due to State of Emergency to overcome the difficult period and may affect indirectly the enforcement proceedings started earlier, weakening the chances of creditors to satisfy their secured claims within reasonable time.
The coronavirus has significant impact on the whole world economy, including the sale of goods. Whether the epidemic is considered as a force majeure event, which automatically exempts from liability to perform an international sale contract? We answer this question under the Vienna Sales Convention and its judicial practice.
Can a party commence litigation in Hungary despite a jurisdictional agreement in favour of a court of a non-EU state which is optional for one of the parties? The Supreme Court recently answered this question in a case which highlights the negative effects of such asymmetric choice-of-court agreements.
Is a penalty for delayed performance enforceable if the purchaser fails to reserve its rights immediately? Or is enforceability excluded only if the purchaser expressly waives its right? This article analyses the Supreme Court's judgment in a recent construction dispute, in which the court appears to have maintained its estoppel-based practice despite recent legislative changes.
Can the unfairness of cross-border claim be reviewed ex officio in case of consumer contracts in such a simplified procedure, like the European order for payment procedure? In our article, we analyse the recent judgement of the Court of Justice of the European Union in the Bondora case and its possible effects on cross-border debt recovery, covering also the Hungarian legal regulations.
You can hear a lot of stories where the debtor “escaped with the money”, the construction contractor “disappeared” or the debtor company’s assets have been hidden. Essentially, failure to pay is a breach of contract, which is subject to civil action, eg. litigation. However, if a transaction is suspected to be a scam, criminal proceedings may be brought against the defaulting debtor, for example, for fraud, which we examine in this article.
The case law of Hungarian construction disputes in the last years sheds light on the intention of courts to protect the “weaker party”. The Supreme Court has already started to protect subcontractors by declaring certain contract terms invalid, and its recent decision even places more risks at general contractors. How to cope with these challenges in Hungary? We address this question in our article.
Construction trusteeship, as mandatory collateral management of major construction projects in Hungary, strives for protecting subcontractors against non-paying general contractor, by allowing direct payments from employer under certain conditions. How does it work in practice and what are the limits of subcontractor protection? We address these issues in this article.
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?
Collateral management is a key issue in every construction project. In Hungary a special regime, the so-called construction trusteeship protects the interest of the participants of major private construction projects, and secures that contractors and subcontractors receive their remuneration for the work performed.
To what extent shall the engineer be independent and impartial under FIDIC construction contracts? Are the same standards applicable to the members of the dispute board? Do they have an obligation of disclosure? We address these questions in the light of the Hungarian court practice.
Whether a mobile payment system can be nationalized in an EU member state relying on the doctrine of services of general economic interest? The Luxembourg court this time examined the Hungarian national mobile payment system. We analyze the reasons of the decision in our article.
We are no longer keeping it secret: in August, the new law on the protection of business secrets entered into force, which, unlike the fragmented rules that have been applied so far, will protect business secrets and know-how in Hungary more uniformly and effectively. We summarize the most important aspects of the new law in our article.
The Devil is always in the details. The truth of the old adage is proven by the new bill adopted by the Hungarian Parliament during the hot summer sessions of July 2018. The new law amending the Bankruptcy Act modifies only one section of the liquidation procedure, but it will further erode the already low paying moral in Hungary, giving more months of grace to non-paying debtors.
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.
An unsigned contract can cause serious problems, if any of the parties dispute its content later by ‘cherry picking’ contract terms. Nowadays, when the vast majority of commercial contracts is negotiated via e-mails, and parties often forget to sign hard copies, the risk is higher than in the good old times. Fortunately, the recent ruling of the Supreme Court in one of our clients’ case gives clear guidance in this issue.
Your worst nightmare as logistic provider in Hungary is a situation when your carrier blocks or sells the shipment due to an unpaid invoice. This is even worse if the invoice in question is unfounded but you decide to pay it to prevent further problems as dissatisfied customers, and the like. To avoid this situation, you have to know the 5 most important tips for subcontractor claim handling under Hungarian law, that we gathered in this article.