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67 New Articles

Due to the state of emergency related to the coronavirus outbreak, sooner or later many business owners, company managers, and chief legal or financial officers will be relieved of their more routine, day-to-day work. This is a time when it might be worthwhile to sort out the company’s legal or financial issues that you may not have had time for during your day-to-day operations. Here are five tips worth considering.

Read more: Legal and Tax Tips for the Coronavirus Shutdown

Noerr has advised the Doktor24 Group on a series of transactions, including raising private equity capital and acquiring two healthcare businesses in Hungary: Svabhegyi Gyermekgyogyintezet and Kastelypark Klinika. Dentons advised the co-investors on the funding, the Jalsovszky Law Firm advised the sellers of Svabhegyi Gyermekgyogyintezet, and Szabo Kelemen & Partners advised the sellers of Kastelypark Klinika.

Read more: Noerr, Dentons, Jalsovszky, and Szabo Kelemen & Partners Advise on Doktor24 Group's Funding and...

The coronavirus outbreak is unfortunately having an impact on every aspect of our lives, and sets to affect a considerable number of businesses. For this reason we’ve summarised the five most important legal considerations that no business can afford to ignore at this time.

Read more: Legal Action Plan at the Time of the Coronavirus

So far, it has been relatively easy for neighbours and other stakeholders to challenge the building permit of a major development project during the licensing process. This situation created major potential for extortion for these individuals. However, with the amendment of the building regulations, which came into effect on 1 March, this vulnerability would appear to have been eliminated.

Read more: The Building Licensing Rules are Changed, Eliminating the Possibility of Blackmail

Investment funds are generally considered a complex, collective, highly specialised form of investment. However, an amendment that came into force from January this year, will allow a much wider range of participants to set up investment funds and fund management companies. And these funds can present very favourable opportunities, whether for acquisition purposes or for holding private assets.

Read more: Investment Funds … For All

While dozens of programmers, engineers and hairdressers continue to opt for KATA [the fixed-rate tax for enterprises categorised as “small taxpayers”] in Hungary, the tax is increasingly coming under fire from all sides. Apparently, the Hungarian Tax Authority (NAV) is stepping up its investigations into businesses who employ KATA payers, and at the same time rumours are also flying about a planned KATA tightening.

Read more: KATA in the Crosshairs

For two years, new rules apply to proceedings at the ordinary courts, which make litigation a lot more difficult and formalised. As a result, lawyers are increasingly confronted with the question of whether the arbitration court or the ordinary court is more appropriate for ruling on any potential disputes. Of course, the time-worn answer is: it depends… But on what?

Read more: Arbitration Court or Ordinary Court – How Should we Choose?

Noerr has advised Germany-based ElringKlinger AG on the sale of the Heliport Industrial Park in Kecskemet, Hungary, to Infogroup. Jalsovszky advised the Hungarian real estate development group on its acquisition.

Read more: Noerr advises ElringKlinger on Sale of Heliport Industrial Park to Infogroup

Jalsovszky has advised Magyar Posta Takarek Ingatlan Befektetesi Alap on its sale of a retail portfolio, consisting of warehouses in the Hungarian communities of Ajka, Albertirsa, Dunaujvarosm, and Oroshaz. The unidentified buyers were advised by Lovasz.

Read more: Jalsovszky Advises Magyar Posta Takarek Ingatlan Befektetesi Alap on Sale of Warehouse Portfolio

Most have heard of the difference between Anglo-Saxon case law and the continental courts – and perhaps that Hungary has so far firmly belonged to the latter camp. However, an amendment to the law that has recently been adopted represents a major step in the opposite direction – one that could result in thousands of Supreme Court rulings becoming precedents overnight. 

Read more: Case Law More Widely Used in Hungary

While a typical small or medium-sized family business consists of a single company, large enterprises tend to work in the form of a company group, made up of numerous companies. How do company groups form and what justifies their formation? When is it worth establishing a company group? These are the questions we seek to answer.

Read more: Company Group Therapy: When and Why Should we Transform our Business Into Company Group?

If you decide to apply for bank financing, you will need to consider not only the financial terms of the loan but also whether you are ready to allow the bank to access your assets as collateral. It will probably ask for the following guarantees.

Read more: TOP 5 Collaterals Used by Hungarian Banks in Financing Deals

When it comes to instances of compensation, this is not always the case. The European Court of Justice (ECJ) has recently reiterated that compensation for damages or contractual penalties may also qualify as consideration for a service for the purposes of VAT. This is important because consideration (i.e. the price of a service) is subject to VAT, whereas compensation is not. This could affect so-called loyalty periods or other fixed-term services in particular.

Read more: It Walks Like a Duck, and Quacks Like a Duck, Then it’s a Duck, Right

One does not simply walk into the courtroom and hope for the best. To win a civil case you will need to navigate through the strict formalities that were introduced by the new Hungarian civil procedure code. It closed many well-known paths of litigation tactics and antics but also opened up new possibilities.

Read more: 5 Ways to Win Lawsuit in Hungary

It has long been a problem that the tax authority refuses to refund to a supplier the VAT that has already paid by him, even if the customer has not paid the gross purchase price at all. However, in a recent ruling, the European Court of Justice has clearly ruled that if the claim has become definitively unrecoverable, the Hungarian tax authority NAV is also required to refund the VAT on that claim to the seller. This decision now also allows other affected taxpayers to request a refund of the VAT on their unrecoverable receivables within a maximum of six months.

Read more: The ECJ Has Decided: Taxpayers Have Six Months to Reclaim VAT
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Jalsovszky

Jalsovszky is one of Budapest’s fastest-growing and most innovative law firms. The key to our success is a business-focused approach paired with logical thinking. Clients appreciate that we are never afraid to voice our opinion even in critical situations.

We regard ourselves as a boutique law firm. No matter how experienced our associates are, we cannot be fully conversant in every area of the law, even in the field of commercial law. But when it comes to what we specialise in, we consider ourselves to be among the best.

Whether with regard to our clients or our staff, it is a human-oriented thinking that defines us. It is important for us to build personal relationships with our clients. We believe a personal relationship does not get in the way of providing a high-quality professional service – on the contrary, it makes the co-operation even more effective. We aim, further, to provide our colleagues with a friendly and supportive environment in which they can find fulfilment and motivation.

Our firm’s market-leading role and the exceptional quality of our legal team is acknowledged year in, year out by numerous international rating agencies (including the publications Legal500, Chambers and Partners, IFLR and International Tax Review).

For further information, please visit jalsovszky.com