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Amendments to the Land Transaction Act from 1 January 2024

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Certain amendments to the Land Transaction Act entered into force on 1 January 2024. The amendment introduces the definition of a rice farm, which includes the land and, as an accessory thereto, the land parcel registered as an area excluded from cultivation serving the rice production (e.g. ditch and drainage systems, embankments and farm roads). The amended Act contains specific provisions, such as two new legal bases for the pre-emption right in respect of rice farms.

The amended Act also contains a new provision under which a non-resident natural person and a national of a Member State who is not a farmer may acquire the right to use a land if the area of the land in his possession, including the area of the land to be acquired, does not exceed 1 hectare and the person making the transfer is a close relative of the land user. By the amendment of the Land Transaction Act, the acquisition of the right to use land was simplified, as the contracting party must declare only once in the contract for the right to use land that he has no legally established and outstanding fee debt, without having to make a separate declaration in a private or public document with full evidential effect.

The amendment also extends the cases of refusal to approve a leasehold (in Hungarian: “haszonbérlet”). Furthermore, the amended Act extends the scope of cases not subject to the approval by the agricultural administration body, thus, the approval of the agricultural administration body is not required for a land-use contract between a family agricultural association as a land user and its member as a user.

In view of the fact that the full transition to electronic administration will be implemented gradually within the framework of the “E-Land Register” project and that this project also concerns land transaction procedures, it was necessary to include this gradualness in the provisions of the Land Transaction Act. Therefore, certain provisions of the Land Transaction Act are applicable between 1 October 2024 and 3 December 2024 if the procedure is initiated through the IT system supporting land transaction procedures.

By Lidia Suveges, Attorney at law, KCG Partners Law Firm

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