The Hungarian Government promulgated a decree (229/2020) entered into force on 1 June 2020, amending the decrees on certain procedural measures in force during an emergency (74/2020.) and on certain penitentiary rules in connection with the declaration of a state of emergency (90/2020.). The amendment regulates civil court proceedings for a transitional period, since on 26 May 2020 two bills related to the termination of the state of emergency were submitted to the Parliament, which define rules of court proceedings for a longer period in the future. As a result, the rules of this decree will only be used until the two bills mentioned above are accepted by the Parliament.

On 28 May 2020, the Hungarian Government adopted amendments to the laws on company liquidation and forced deletion procedures to cushion the impact of the global coronavirus pandemic on the economy.

The Hungarian Government issued a new decree on 25 May 2020 (“Decree”), in which restrictions on certain transactions involving foreign investors are introduced.

In Hungary, the defense against the epidemic has entered into a phase in which measures set out by the government for reducing or preventing the spread of the epidemic are gradually relaxed. The curfew has been lifted, all stores may open and may be visited by customers under certain conditions. However, the rules for maintaining social distance - keeping a distance of 1.5 meters from one another, wearing mask, scarf or shawl when shopping or traveling by public transport - still apply.

The Government of Hungary has proposed an amendment to Act XLIX of 1991 on bankruptcy and liquidation proceedings (Insolvency Act) aiming to modernise the procedural rules of insolvency proceedings, for example by introducing communication via email and video conferences.

While there were still as many as 60 types of tax in Hungary five years ago, this number was reduced to 54 by the end of last year. This process was interrupted by the recent introduction of crisis taxes. It remains to be seen whether this trend will now be reversed.

The coronavirus pandemic has been affecting both domestic and international trade and commerce around the world. States have reacted with robust mitigation measures, including closing borders, implementing a range of travel bans and engaging a myriad of internal domestic health and wellbeing procedures. These measures are causing unprecedented disruption to the trade, transport, labor market, production and supply chains.

On 25 May 2020, the Government of Hungary adopted a new decree on the screening of foreign investments in Hungary (the "Decree"). The new screening regime aims to protect public security, order and health during the COVID-19 pandemic, and introduced a new approval requirement for investments into certain Hungarian companies. The screening will be carried out by the Minister of National Economy (the "Minister"). The Decree entered into force on 26 May 2020 while leaving the earlier FDI screening mechanism unaffected (see our earlier FDI screening article). As a result, two parallel FDI screening mechanisms now apply in Hungary.

Erdos | Katona has opened its doors as a transactional boutique in Budapest.

In recent years, and for multiple reasons, cyber-attacks against healthcare providers have increased significantly on a global level. First, IT platforms and devices used by healthcare providers have a technical diversity, while sources devoted to an integrated cybersecurity system for these IT platforms are often limited, making the IT systems vulnerable and ideal targets of potential cyber-attacks. Second, health data qualifies as “highly sensitive data,” which is considered very valuable on the black market compared to other types of personal data.

Market Spotlight - Hungary

The Hungarian banking sector enjoyed a banner year in 2019, but still faces challenges. Legislative changes are creating more aggressive competition between banks, which in turn are cutting fees and demanding flexible financing structures in order to survive. Although some banks are unwilling to take part in these practices, one thing is certain: All banks must adapt to the new regulatory environment. I’ve outlined some of the major challenges that Hungarian banks face in the near future.

On December 27, 2019, several amendments made to the Hungarian capital markets act by the Hungarian Parliament to adhere to the relevant rules of the European Union be-came effective, also making it easier for Hungarian companies to issue bonds under the Bond Funding for Growth Scheme (BGS) by introducing more lenient information and publication rules for issuances.

In the few months since Hungary’s Private Foundation Act came into force on March 29, 2019, it has already significantly grown in terms of financial importance.

Dentons Partner Anita Horvath has been appointed Co-Head of the firm’s Corporate and M&A Practice in Hungary, where she will work alongside Partner Rob Irving.

On September 20 2019, CEE Legal Matters reported that BLS had advised Pannonia Bio Zrt. – a company operating a biorefinery in Tolna County, Hungary, that is the largest ethanol plant in Europe – and that CMS Hungary had advised OTP Bank Plc. on Pannonia Bio’s issuance of the first Hungarian forint bond in line with the Central Bank of Hungary’s Bond Funding for Growth Scheme.

The Banking sector in Hungary has been doing well in recent years. Schoenherr Budapest Local Partner Gergely Szaloki walks us through that progress.

The Hungarian financial market finished 2019 in a strong position. Intrigued by what many have described as a “special” year, CEE Legal Matters sat down with several of the nation’s leading Banking/Finance lawyers at Lakatos, Koves & Partners’ offices in Budapest to learn more.