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The decision of the U.S. Securities and Exchange Commission (SEC) on January 10 has stirred significant attention, as it granted approval for the listing of certain products based on Bitcoin on the stock exchange. The impact of this decision on the European and American securities markets, and whether similar steps will be taken, depends largely on the details – including the names assigned to cryptocurrency-based products.

One of the measurable success stories of the fintech revolution is how donation and subscription-based community financing has become an alternative to traditional fundraising methods such as classical bank financing or venture capital investments. From this rapid development, it follows that there is a less uniform picture in the public consciousness about the phenomenon of "crowdfunding." How many forms are there? Which ones are regulated? Who are the actors in the process? What regulations apply to it? How are they taxed? Among many clarifications to be made, the main question, however, is whether specialized crowdfunding service providers for this purpose will emerge in Hungary as well.

According to the decision of the Court of Justice of the European Union of 16 May 2024 (C-746/22), the Hungarian rule that does not allow foreign taxpayers in VAT refund cases to submit their documents even in the appeal procedure is contrary to EU law. We have summarised the key lessons learned from the case which was handled by our office.

Jalsovszky's Dispute Resolution practice in Hungary is going from strength to strength according to Partner Tamas Feher, who points to long cases, significant wins, fiscal changes, budgetary pressures, and the economy's slowdown as the ultimate reasons behind their litigators staying busy.

As technology advances, it becomes easier and easier to record any conversation. Today, anyone with a smartphone can easily record business meetings - even in secret. There are many reasons for making a secret recording: for some it may be a security measure to avoid disputes, for others it may be an ulterior motive to use it later. But is it legally permissible to make an audio recording in secret? And what are the consequences of using a secretly made audio recording in a civil or criminal case?

Clifford Chance, working with Jalsovszky, has advised a club of banks led by Ceska Sporitelna on the financing for CVC Capital Partners and Emma Capital's acquisition of Packeta (reported by CEE Legal Matters on January 9, 2024). Wolf Theiss advised Packeta.

Since COVID, we have been living with a rule that makes the acquisition of ownership by foreigners in certain Hungarian companies operating in strategic sectors subject to government approval. Although we can no longer speak of a state of emergency, the rule is expected to stay with us for long – albeit with several modifications along the way, as happened in January this year.

As we move into yet another year with the special surtaxes in effect, the question justifiably arises: for how much longer will the extra-profit taxes, those labelled initially as temporary, encumber the Hungarian taxpayers’ declarations. Also, businesses now have to face additional burdens, such as the EPR fees, the carbon quota tax or the global minimum of the corporate income tax.

Hungary’s litigation landscape was shaped by the economic trends, domestic legal reforms, and global crises of the past 10-15 years. From the 2008 economic crisis to the implementation of the new Civil Procedure Code in 2018 and the transformative effects of the COVID-19 pandemic, it has been a rollercoaster ride.

In The Corner Office, we ask Managing Partners at law firms across Central and Eastern Europe about their backgrounds, strategies, and responsibilities. As we bid farewell to 2023, this time around we turn our attention forward: What is your one main wish for 2024 and what do you see as the biggest potential risk?

If someone is unable to pay their outstanding and due debts (or is just partly able to do so), that person is considered insolvent. This applies to companies and to natural persons as well. The number of companies that had to cease operations because of insolvency increased in 2023. Although the Hungarian legal environment provides several solutions to this problem, these have different effectiveness and have different consequences for both debtors and creditors. Below is a general overview of the four typical procedures for dealing with insolvency in the current Hungarian law.

According to the opinion released yesterday by the advocate general of the European Court of Justice, the Hungarian regulation that prohibits foreign taxpayers from submitting their documents in the second instance (appeal) procedures in VAT refund cases violates European law. If the final judgment will align with this opinion, it would not only simplify the process for foreign businesses to claim VAT refunds in Hungary but would also open the possibility to reclaim previous VAT payments.

From the deceptive quiet of early 2023 to a summer bustling with legal reforms and taxing challenges, Jalsovszky Partner Agnes Bejo sheds light on pivotal developments in Hungary ranging from the EU-mandated whistleblowing system to changes in the trust system, environmental responsibilities, and the shifting investment climate in the country.

Already last year, it was noticeable that after several years of decline, the Hungarian Tax Authority conducts more and more tax audits. In 2022, the number of tax audits increased by 6.2% compared to the previous year. Experience shows that this trend is expected to continue even more strongly this year. The most commonly audited tax category remains VAT.

In The Corner Office, we ask Managing Partners at law firms across Central and Eastern Europe about their backgrounds, strategies, and responsibilities. As key steps, requirements, and timeline for becoming a Partner may vary from firm to firm, this time we asked: Does your firm have a formal Partnership Track and if yes, what does it involve?

From time to time, there’s news of companies introducing four-day work week. Magyar Telekom has been mentioned several times as the first big fish to do so, but Libri, too, has apparently done the same, as have various local subsidiaries of foreign parent companies. The obvious question is whether this option is available to everyone and, if so, at what price.

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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