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New administrative court system to be set up from 2020 in Hungary

New administrative court system to be set up from 2020 in Hungary

Hungary
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In early 2017 the Hungarian Parliament passed the Code of Administrative Litigation as a beginning of the reform of the central administration. As the final step, the Hungarian Parliament adopted a law on the Administrative Courts on 12 December 2018. The goal of the new legislation was to ’restore the prestige of the administrative courts’ which was abolished in 1949. Since then no separate administrative court system existed, it was integrated into the civil courts.

The reason for the separation now is that administrative law has a different internal logic compared to the civil law. Government experts expect that the new system will be capable of contributing to the development of administrative law and jurisprudence, and outbalancing the dominant position of the public administration in the litigation proceedings. 

The legislation sets up 8 regional administrative courts and the ‘administrative high court’. According to the reform, each act of the Hungarian administration that has a legal effect can be challenged, but only before the administrative courts. The regional courts proceed at first instance and the high court proceeds on appeal. In some cases however, for example in proceedings concerning referendums and election procedures, the latter proceeds at first instance.

The opposers of the new court system claim that the Hungarian Minister of Justice will have excessive influence over the judicial system as he will be responsible for the selection of the judges, which could lead to a misuse. Furthermore, they argue that given the fact that these courts will often hear sensitive political cases, with the questionable selection system the judges might be influenced during the procedures. 

The new law will enter into force on 1 January 2020.

By Levente Csengery, Partner, KCG Partners Law Firm

Hungary Knowledge Partner

Nagy és Trócsányi was founded in 1991, turned into limited professional partnership (in Hungarian: ügyvédi iroda) in 1992, with the aim of offering sophisticated legal services. The firm continues to seek excellence in a comprehensive and modern practice, which spans international commercial and business law. 

The firm’s lawyers provide clients with advice and representation in an active, thoughtful and ethical manner, with a real understanding of clients‘ business needs and the markets in which they operate.

The firm is one of the largest home-grown independent law firms in Hungary. Currently Nagy és Trócsányi has 26 lawyers out of which there are 8 active partners. All partners are equity partners.

Nagy és Trócsányi is a legal entity and registered with the Budapest Bar Association. All lawyers of the Budapest office are either members of, or registered as clerks with, the Budapest Bar Association. Several of the firm’s lawyers are admitted attorneys or registered as legal consultants in New York.

The firm advises a broad range of clients, including numerous multinational corporations. 

Our activity focuses on the following practice areas: M&A, company law, litigation and dispute resolution, real estate law, banking and finance, project financing, insolvency and restructuring, venture capital investment, taxation, competition, utilities, energy, media and telecommunication.

Nagy és Trócsányi is the exclusive member firm in Hungary for Lex Mundi – the world’s leading network of independent law firms with in-depth experience in 100+countries worldwide.

The firm advises a broad range of clients, including numerous multinational corporations. Among our key clients are: OTP Bank, Sberbank, Erste Bank, Scania, KS ORKA, Mannvit, DAF Trucks, Booking.com, Museum of Fine Arts of Budapest, Hungarian Post Pte Ltd, Hiventures, Strabag, CPI Hungary, Givaudan, Marks & Spencer, CBA.

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