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Significant Modifications of the Bankruptcy and Liquidation Proceeding Act in Hungary

Significant Modifications of the Bankruptcy and Liquidation Proceeding Act in Hungary

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As of 1 July 2017, an amendment to the Bankruptcy and Liquidation Proceedings Act will enter into force, aiming at close the loopholes and consolidating the case law. The amendment clarifies the provisions on the disputing of the claim by the debtor and on the statutory requirements of the payment reminder to be sent by the creditor. The regulations on the option right and the transfer of rights and claims for security purposes will also be amended.

Furthermore, the rules of raising an objection in case of the measure or failure of the liquidator violating the laws will also be changed, for example, the deadline of the submission of the objection from 8 to 15 days. The amendment revises the rules of the action brought for the establishment of the liability of the directors of the company in case the directors have not acted with regard to the interest of the creditors and as such, the assets of the company decreased or the complete satisfaction of the creditors’ claims may be frustrated. The amendment also clarifies the conditions for exemption from the liability of the directors.

In addition to the amendment of the Bankruptcy and Liquidation Proceedings Act, other acts will also be changed such as the Stamp Duty Act and the Company Registration Act.

By Rita Parkanyi, Attorney, KCG Partners Law Firm

Hungary Knowledge Partner

DLA Piper is a global law firm with lawyers located in more than 40 countries throughout the Americas, Europe, the Middle East, Africa, and Asia Pacific. This positions us to help clients with their legal needs around the world.

With more than 60 lawyers, including 14 partners, and a staff of over 140, DLA Piper Hungary is one of the largest international law firms operating in Hungary. What makes us stand out is that we offer not only legal services but also tax and business advisory support in a fully integrated manner. We maximize synergies between legal, tax, and business advisory services to offer a unique service for our clients, particularly in regulated industries such as energy, infrastructure, life sciences, banking, and telecommunications.

We are a true full-service firm, providing our private and public sector clients with advice on all aspects of their business. This includes transaction-related advice, people and employment, commercial dealings, litigation, information technology, media and communications, intellectual property, insurance, tax, real estate, and restructuring plans.

DLA Piper Hungary has received numerous professional awards and is consistently ranked among the top law firms in Hungary by international rankings. We are ranked #1 by Mergermarket among the law firms active in Hungary based on the volume of M&A deals handled between 2005 and 2024.

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