Contributed by DLA Piper.
1. Legal Framework
1.1. What is the legal framework for bribery and corruption in your jurisdiction?
Bribery and corruption are considered criminal offenses in Hungary, their various forms being regulated by Hungarian Act No. C of 2012 on the Criminal Code (Criminal Code) in nine articles under the Crimes of Corruption chapter:
• Active Corruption (Section 290);
• Passive Corruption (Section 291);
• Active Corruption of Public Officials (Section 293);
• Passive Corruption of Public Officials (Section 294);
• Active Corruption in Court or Regulatory Proceedings (Section 295);
• Passive Corruption in Court or Regulatory Proceedings (Section 296);
• Indirect Corruption (Section 298);
• Abuse of a Function (Section 299) and
• Failure to Report Crimes of Corruption (Section 300).
1.2. Which international anti-corruption conventions apply?
Hungary takes part in the anti-corruption efforts of the OECD, the UNCAC PWG, IACA, GRECO, as well as the EPAC/EACN.
1.3. What is the definition of bribery?
Bribery is a felony committed by a person who gives or promises an unlawful advantage to a person working for or on behalf of an economic operator, or to another person on account of such employee, to induce him to breach his duties (active corruption) or a felony committed by a person who requests or receives an unlawful advantage in connection with their activities performed for or on behalf of an economic operator, or accepts a promise of such an advantage, for himself or for a third party, or is in league with the person requesting or accepting the advantage requested by or given for a third party on their behest (passive corruption). Further forms of the offense include additional circumstances that aggravate the crime, such as when committed by/concerning a public official, or in the course of judicial or administrative proceedings.
1.4. Is private sector bribery covered by law? If yes, what is the relevant legislation?
Yes. As elaborated in Section 1.3., bribery in the private sector is considered a criminal offense (Sections 290 and 291 of the Criminal Code).
1.5. What is the definition of a public official and a foreign public official? Are employees at state-owned or state-controlled enterprises treated differently? Are there official lists of public officials, offices, or state-owned or state-controlled enterprises?
Section 459(1)(11) in the Definitions chapter of the Criminal Code expressly sets out the list of persons considered to be public officials and foreign public officials.
Hungarian public officials are:
a) the President of the Republic;
b) Members of Parliament, spokesmen for the national minorities, and Members of the European Parliament elected in Hungary;
c) judges of the Constitutional Court;
d) the Prime Minister, other ministers, state secretaries, state secretaries for public administration and deputy state secretaries, chief prefects;
e) judges, public prosecutors, and arbitrators;
f) the Commissioner of Fundamental Rights and his deputies;
g) public notaries and assistant public notaries;
h) independent court bailiffs, independent bailiff substitutes, and assistant bailiffs authorized to serve the process;
i) members or councils of representatives of municipal governments and representatives of national minorities’ self-governments;
j) commanding officers of the Hungarian Armed Forces, and commanders of watercraft or aircraft, if vested with authority to enforce the regulations pertaining to investigating authorities;
k) members of the staff of the Alkotmanybirosag (Constitutional Court), the Sandor Palace (Office of the President of the Republic, the Orszaggyules Hivatala (Office of Parliament), the Alapveto Jogok Biztosanak Hivatala (Office of the Commissioner of Fundamental Rights), Magyar Nemzeti Bank (National Bank of Hungary), the Allami Szamvevoszek (State Audit Office), the courts, prosecutors’ offices, central government agencies, the Orszaggyulesi Orseg (Parliament Guard), Budapest and greater county government agencies, and persons exercising executive powers or serving at public bodies, whose activity forms part of the proper functioning of the agency in question; and
l) members of the election committee.
Foreign public officials are:
a) a person serving in the legislature, judicial, administrative, or law enforcement body of a foreign state, and/or persons exercising executive powers or serving in foreign states, including persons exercising executive powers or serving in public bodies or in state or municipal government-owned companies;
b) a person serving in an international organization created under an international treaty ratified by an act of Parliament, whose activities form part of the organization’s activities;
c) a person elected to serve in the general assembly or body of an international organization created under an international treaty ratified by an act of Parliament, including members of the European Parliament elected abroad; or
d) a member of an international court that is vested with jurisdiction over the territory or over the citizens of Hungary, and any person serving in such international court, whose activities form part of the court’s activities.
1.6. Are there any regulations on political donations?
Yes. The Hungarian Act No. XXXIII of 1989 on the Operation and Financial Management of Political Parties regulates in detail the legality and conditions of political donations.
1.7. Are there any defenses available?
Bribery and corruption offenses are investigated by authorities (police, public prosecutors) and judged by a criminal court. During the proceedings, the defendant is entitled to procedural guarantees, such as the right of defense, the right to remedies, the prohibition of self-incrimination, or the presumption of innocence, in accordance with Hungarian Act No. XC of 2017 on Criminal Proceedings.
In addition, under special circumstances set out in the Criminal Code, a penalty may be reduced without limitation – or dismissed in cases deserving special consideration – against the perpetrator of a criminal offense of corruption, if he confesses the act to the authorities firsthand, before they gained knowledge thereof, unveils the circumstances of the criminal act, and, in the case of passive corruption, surrenders the obtained unlawful financial advantage in any form to the authorities.
1.8. Is there an exemption for facilitation payments?
No. The promise or giving of a facilitation payment (as an undue advantage) is considered a bribe. In fact, in the case of bribery, the benefit from the criminal offense is subject to confiscation, with the burden of proof reversed onto the defendant to prove that the property in question did not result from a crime.
1.9. What are the criminal sanctions for bribery? Are there any civil and administrative sanctions related to bribery cases?
The least serious form of bribery is punishable by three-month imprisonment, while the most serious offense (committed by a public official) is punishable by ten years in prison. In less severe cases, Hungarian law allows for the imposition of other penalties (e.g., community service, fine) instead of imprisonment, while in some cases an additional penalty (e.g., fine or disqualification from a profession) may be imposed in addition to imprisonment.
1.10. Does the national bribery and corruption law apply beyond national boundaries?
The provisions of the Criminal Code (including its sections on bribery and corruption) apply to all persons, regardless of nationality, in the territory of Hungary. They apply to Hungarian citizens outside of Hungary as well.
1.11. What are the limitation periods for bribery offenses?
The statute of limitations for crimes of corruption under the Criminal Code is 12 years.
1.12. Are there any planned amendments or developments to the national bribery and corruption law?
We are not aware of any planned amendments or developments to the Hungarian bribery and corruption regime.
2. Gifts and Hospitality
2.1. How are gifts and hospitality treated?
Hungarian law does not set a threshold for the promise or giving of a benefit to constitute a bribe. According to judicial practice/case law, a benefit, no matter how small in value, may constitute a bribe if it is unlawful (i.e., promised or given to induce another person to breach an obligation). Therefore, it is necessary to consider all the circumstances of a case to determine whether a gift or hospitality may constitute a bribe in a particular situation.
Industry standards may provide guidance as to the level or value of benefits in a particular sector/profession that are presumed not to constitute bribery, but they should not undermine the above legal rules and judicial practice that even the smallest benefit can constitute bribery.
An exception is applicable to healthcare workers, who may, once after the provision of the service, accept as a gift from the patient or another person in respect of the patient, an object, the value of which does not exceed 5% of the monthly amount of minimum wage. However, a healthcare worker cannot accept any additional benefits above this amount.
2.2. Does the law give any specific guidance on gifts and hospitality in the public and private sectors?
As mentioned above, healthcare workers who may, once after the provision of the service, accept as a gift from the patient or another person in respect of the patient an object, the value of which does not exceed 5% of the monthly amount of minimum wage. However, a healthcare worker cannot accept any additional benefits above this amount.
2.3. Are there limitations on the value of benefits (gifts and hospitality) and/or any other benefit) that may be given to a government/public official? If so, please describe those limitations and their bases.
Giving gifts of protocol is generally an accepted practice, but there is no explicit exception to these in Hungarian law: these are rather to be found in codes of professional ethics, such as those set out by the Hungarian Government Officials Corps. These typically lay down strict rules on, for example, accepting gifts of gratuity, gifts of attention, or hospitality. However, as explained above, these rules are not for the purposes of derogating from the above legal rules and judicial practice that even the smallest benefit can constitute bribery.
2.4. Are there any defenses or exceptions to the limitations (e.g., reasonable promotional expenses)?
See Sections 2.1.-2.3.
3. Anti-Corruption Compliance
3.1. Are companies required to have anti-corruption compliance procedures in place?
In general, there is no requirement for companies to have anti-corruption procedures or policies in place. However, for certain companies covered by sectoral legislation (e.g., financial institutions) or for more complex companies or groups of companies, the need to have such policies and procedures in place may be inherent in their operation. In addition, the recently adopted Hungarian Act No. XXV of 2023 on Complaints and Public Interest Disclosures, and on the Rules of Whistleblowing Notifications (Whistleblowing Act) puts pressure on companies as well to take more effective action against corruption.
3.2. Is there any official guidance on anti-corruption compliance?
Regarding bodies of public administration, the Hungarian Government adopts the National Anti-Corruption Strategy from time to time, the current one being laid down by Government Decision No. 1025/2024. (II. 14.) for the years 2024 and 2025.
3.3. Does the law protect whistleblowers reporting bribery and corruption allegations? If an EU member, was the EU Directive on Whistleblowing implemented in your jurisdiction?
Yes. The Whistleblowing Act implemented the EU Directive on Whistleblowing.
3.3.1. What can be reported?
The scope of the Whistleblowing Act is very broad, going well beyond the scope of the EU Directive, not limited to certain sectors, and allowing the reporting of any kind of complaint or abuse in a very general way.
The Whistleblowing Act contains rules both on complaints to public bodies and on the whistleblowing system to be established within publicly-owned and private companies.
With respect to public bodies, complaints, and public disclosures may be made. A complaint means a request made for eliminating any breach of personal right or interest, and its handling does not fall under the scope of other, in particular judicial or administrative, procedures. A complaint may also contain a proposal. A public interest disclosure obtains to draw attention to a situation that should be remedied or eliminated in the interest of the community or society as a whole. A public interest disclosure may also contain a proposal.
With respect to publicly-owned or private companies, the internal fraud reporting system may be used to report information relating to illegal or suspected illegal acts or omissions, including other instances of fraud, and even to report any breach of a code of conduct in place at an employer, without limitation as to subject matter.
3.3.2. Who is protected?
In the case of a complaint or public disclosure to public bodies, anyone who makes such a complaint or disclosure may enjoy protection. In the case of an internal fraud reporting system, however, notwithstanding the broad scope of the Whistleblowing Act, a reporting person may qualify for protection only if:
a) the reported information regarding the circumstances affected by the report falls under the scope of the European Union legislation or the legislation adopted for the implementation of or compliance with such European Union legislation; or
b) the reporting person had reasonable grounds to believe that the circumstances under point a) apply.
3.3.3. What are the conditions for protection?
See Section 3.3.2.
3.3.4. What companies does the relevant legislation apply to?
It applies to companies that employ at least 50 persons under contract for some form of employment.
In addition, regardless of the number of employees, it applies to companies where:
a) the employer falls under the Hungarian anti-money laundering legislation;
b) the employer is registered in Hungary and engaged in offshore oil and gas activities as the holder of authorization or operator outside the borders of the European Union;
c) the employer falls under civil aviation legislation; and
d) the employer is the operator of an active floating installation operating in the territory of Hungary under the Hungarian or a non-Hungarian flag.
4. Corporate Criminal Liability
4.1. Can corporate entities be held liable for bribery and corruption? If so, what is the nature and scope of such liability?
Only natural persons can be held criminally liable, but certain criminal sanctions can be imposed on legal entities involved (e.g., used for or benefiting from the activity) as a result of the criminal activity of natural persons, as set out in Hungarian Act No. CIV of 2001 on Criminal Measures Against Legal Persons:
If the offense was committed with the purpose or effect of obtaining an advantage for the benefit of the legal entity, or was committed using the legal entity, and:
a) The offense was committed by the manager of or a member authorized to represent the legal entity, its employee or officer, its manager or a member of its supervisory board or their delegates, in the course of the legal entity’s business; or
b) the member or employee committed the offense in the course of the legal entity’s business and the fulfillment of the duties of management or control by the manager, the company director or the supervisory board could have prevented the offense.
In addition to the cases provided for above, the sanctions may also be applied if the offense resulted in the acquisition of an advantage for the benefit of the legal entity or the offense was committed using the legal entity and the managing director or member, employee or officer, company director or member of the supervisory board of the legal entity who was authorized to represent the legal entity knew of the commission of the offense.
4.2. Can a company be liable for a bribery offense committed by an entity controlled or owned by it? Are there requirements for the parent to avoid liability in these situations?
Criminal offenses may be committed only by a natural person whose acts then may have an effect on the legal consequences applicable to the legal entity. For this reason, in relation to companies owned or controlled, Section 4.1. applies.
4.3. Can a company be liable for corrupt actions of a third-party agent engaged to help it obtain or retain business or business advantage (such as government or regulatory actions or approvals)? If so, are there measures recognized in law, enforcement, or regulatory guidance to mitigate this liability?
As described in Section 4.1., it cannot be excluded that as a result of an offense committed by a third party outside the legal entity (e.g., the offense was committed using the legal entity and the managing director or member, employee or officer, company director or member of the supervisory board of the legal entity who was authorized to represent the legal entity knew of the commission of the offense), legal consequences may be applied against the legal entity. In such cases, the risk does not arise where the legal entity’s representatives are not aware of the third party’s actions.
4.4. What are the sanctions for the corporate criminal entity?
Sanctions against the legal entity may be:
a) the dissolution of the legal entity;
b) limitation of the activities of the legal entity; or
c) a fine. The maximum fine that may be imposed on a legal entity may be three times the value of the pecuniary advantage achieved or intended to be achieved by the criminal offense, but shall not be less than HUF 650,000 (approximately EUR 1,650).
5. Criminal Proceedings for Bribery and Corruption Cases
5.1. What authorities can prosecute corruption crimes?
The Prosecution Service of Hungary and the prosecutors are those who have the power to prosecute corruption crimes.
5.2. Is there a legal obligation to report bribery and corruption cases? If so, to whom does it apply and what are the sanctions for failing to meet such an obligation?
Yes. There is an obligation for public officials to report bribery and corruption cases. Any public official who has knowledge of an act of active or passive corruption yet to be detected, active or passive corruption of public officials, active or passive corruption in court or regulatory proceedings, indirect bribery or abuse of a function, and fails to promptly report that to the authorities at the earliest possibility, is guilty of a felony punishable by imprisonment exceeding to a maximum of three years.
5.3. Is there any civil or administrative enforcement against corruption crimes?
If the act of corruption has caused damage or injury to a person, that person may bring a claim before a civil court. Administrative enforcement is not applicable in corruption cases.
5.4. What powers do the authorities have generally to gather information when investigating corruption crimes?
The authorities have a wide range of tools at their disposal during an investigation. Some of these can be used without any authorization from a judge or prosecutor, others are subject to authorization from a prosecutor (e.g., monitoring payment transactions) and others can only be used with a judge’s authorization (e.g., wiretapping, secret searches). Their use is subject to compliance with procedural rules by the authorities.
5.5. Is there any form of leniency law in your jurisdiction, allowing a party to a bribery or corruption crime to voluntarily confess to the crime in exchange for a release from liability or reduction of the penalty?
Yes. As described in Section 1.7., subject to criteria laid down in the Criminal Code, under special circumstances, a penalty may be reduced without limitation – or dismissed in cases deserving special consideration – against the perpetrator of a criminal offense of corruption, if he confesses the act to the authorities first hand, before they gained knowledge thereof, unveils the circumstances of the criminal act, and, in the case of passive corruption, surrenders the obtained unlawful financial advantage in any form to the authorities.
5.6. Can a person plea bargain in corruption cases? If so, how is such a process conducted?
The prosecution and the defendant may enter into a plea bargain on the admission of guilt and the consequences thereof in respect of the offense committed by the defendant before the filing of the indictment. The conclusion of a plea bargain may be initiated by the defendant, the defense and the prosecution as well.