The Hungarian Competition Authority has launched the public consultation process about the draft of its updated and amended communication concerning commitment decisions in Hungarian competition cases.
As to the pending issue of the preferential VAT rate of 5% for new residential properties, finally the new tax laws approved by the Hungarian Parliament in November 2018 will remain to ensure the reduced VAT rate of 5% in case the date of completion of the residential properties is after 31 December 2019, provided that certain conditions are all met on 31 December 2019. These conditions are that a) the sale and purchase agreement has been submitted to the land registry office, b) the residential property can be considered as a structurally complete building (shell and core) and c) the seller of the residential makes a declaration to the tax authority on the compliance of the conditions included in points a) and b).
The news that many of the legal markets in CEE impose stricter rules on law firm advertising and marketing than many of their Western counterparts comes as no surprise. Still, to explore this concept just a bit, for this issue, we asked law firm marketing and BD experts around CEE: “What, in your opinion, is the biggest difference between law firm marketing in your market and law firm marketing in London or New York?
Maravela | Asociatii has assisted Precision for Medicine in connection with Romanian law aspects of its multi-jurisdictional acquisition of contract research organization Argint International. Bird & Bird was lead counsel to Precision for Medicine on the deal. Kinstellar's advised the sellers on Romanian, Czech, and Hungarian aspects of the deal, working with lead counsel Osborne Clarke.
CIJ Awards Hungary 2018, 12 December 2018, Marriott Hotel, Budapest
The finance ministers of the European Union Member States support the request of the Hungarian Government relating to the tax reduction and simplification for small enterprises. According to this decision, the limit for VAT exemption for small enterprises might be increased to HUF 12 million. This legislative amendment would affect more than 600,000 taxpayers. If the Hungarian Parliament adopts this change, this amount will be equal to the income limit of the taxpayers falling under the scope of the Act on the Fixed-Rate Tax of Low Tax-Bracket, which is also HUF 12 million. Due to this change, the companies with a revenue up to HUF 1 million per month could also apply for this type of tax liability.
According to some sources from the Hungarian Prime Minister’s Office, a lifelong personal income tax exemption is planned to be applied to mothers with at least three children. With this tax cut, the Hungarian Government would intend to encourage families to have more children, and to increase the fertility rate in Hungary, which is one of the lowest in Europe. This measure could result in approximately HUF 100 billion (~EUR 285 million) loss of revenue for the Government budget, which is 5% of the total personal income tax revenue. On the other hand, it is difficult to estimate how this tax exemption will affect the fertility rate or the women re-entering the labour market.
Clifford Chance has advised Ceskoslovenska Obchodni Banka, a. s., as mandated lead arranger, facility agent, security agent, and underwriter on the initial finance documentation and in relation to subsequent syndication and transactional closing with Ceska Sporitelna, a.s. and the EBRD on financing provided to Karlovarske Mineralni Vody's for its acquisition of PepsiCo's assets and operations in the Czech Republic, Slovakia, and Hungary. Kocian Solc Balastik advised KMV on the financing and on the underlying acquisition, and represented KMV in proceedings before the Czech Competition Authority.
Guidance No. 12/2018 (II.27) of the Hungarian National Bank entered into effect on July 1, 2018 (the “Guidance”). Although the Guidance is non-binding, financial institutions are expected to comply with its provisions. In this article, we provide a list of the most important points of the Guidance and predict market reactions based on our ongoing mandates and information obtained from our clients.
The European Council adopted an amendment to the Posting of Workers Directive on 21 June 2018. The purpose of the revised Directive was to ensure fair competition for companies and better protection for workers who have been sent by their employers to perform services in another EU Member State on a temporary basis. Under the new regime, all of the host country’s remuneration rules should apply to posted workers, so that the posted workers could get equal pay for equal work in the same place.
From 1 January 2020, the reduced tax rate of 5% applicable to the flats to be constructed or existing in a multi-unit residential building with a total net floor space not exceeding 150 square meters and to the single-unit residential building with a total net floor space not exceeding 300 square meters will be terminated and the general VAT rate of 27% will be applicable for the sales of such residential properties.
On March 9, 2018, CEE Legal Matters reported on the expansion of the European act legal alliance with the addition of Hungary’s Ban Karika law firm and Fort Advocaten from the Netherlands. With the alliance now counting 13 offices in Europe – including five in CEE – CEE Legal Matters sat down with Sven Tischendorf of act legal Germany, AC Tischendorf Rechtsanwälte to learn more about the alliance’s plans.
The Hungarian Government recently adopted Act no. LVII of 2018 on the Control of Investments Detrimental to the Interests of Hungarian National Security (the "Act"). Previously we wrote about a similar legislative proposal [see here] (the "Proposal") which aimed at establishing a similar control mechanism. However, the Act has a more sophisticated approach on the control and approval procedure than the earlier proposal had. Pursuant to the Act, investors from outside the EU, Switzerland and EEA countries who wish to invest in Hungary must obtain prior approval from the minister to be designated by a governmental decree ("Minister") which has not yet been adopted.