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European Court of Human Rights Approves of Hungarian Tax Defaulter List

European Court of Human Rights Approves of Hungarian Tax Defaulter List

Hungary
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Hungarian National Tax and Customs Authority regularly publishes the list of major tax defaulters for failing to fulfil their tax obligations in Hungary. The list also contains private data of the defaulters, including, inter alia, information on tax arrears and debts and their home address. In a recent case (L.B. v. Hungary – 36345/16), European Court of Human Rights concluded no violation and confirmed the approach of Hungarian tax authority as justified.

Hungarian tax legislation provides for the publication of personal details of major tax defaulters and major tax evaders (those whose tax arrears and tax debts exceeded HUF 10 million, approximately EUR 30,000). Publication was subject to the condition that the affected persons had failed to fulfil their tax obligations over an extended period of time (180 days).

Hungarian tax authority had published personal data of L.B. in connection with his failure to contribute to public revenue, accordingly, L.B claimed that his right to privacy had been violated and had referred to the general public-shaming effect of appearing on the list.

European Court of Human Rights considered whether this interference (if any) was lawful, followed a legitimate aim and whether it was necessary. In this regards, the Court found that the measures aimed to improve discipline regarding tax payment and thereby followed the legitimate goal of protecting the economic well-being of Hungary. Moreover, the aim of disclosure of the applicant’s data under a list of “major tax evaders” had been to protect the particular interests of third parties.

In light of the above, European Court of Human Rights established that making such information public could not be considered a serious intrusion into the personal sphere. Making his personal data public had been justified by furthering the State’s legitimate interest.

By Balint Zsoldos, Head of Tax, 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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