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Imminent new Land Register Act

Imminent new Land Register Act

Hungary
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On 20 April 2021 the Hungarian Government submitted a bill on the Land Register to the Hungarian Parliament. The Government decided on the implementation of the electronic land register project, which requires a new Act on the Land Register, as well as a related execution decree. The purpose of the new system is in particular to develop the land register to an electronic database, completely electronize the land register procedures, connect the land register with other public electronic registers of the state and decrease the time and costs of these proceedings.

As a new element of the regulation, the extent of rights, facts and data that may be registered in the land register must be determined solely by the land register regulation instead of by sectoral legislation. In addition, any rights or obligations based on a fact or data can be enforceable if this right, fact or data was registered in the land register (i.e. principle of completeness and extension of principle of registration). In specific cases, automatic decision will be applied in the land registry procedures, and, as a guarantee, the client may request within five days from the notification of the decision that the application must be proceeded with in a complete procedure repeatedly.

The bill includes several novelties compared to the current Land Register Act partly as a result of the digitalization. For instance, submissions must be filed by electronic means. In addition, the bill does not allow the solution to keep the submission on marginal note (in Hungarian: “széljegy”) in abeyance (pending), but these cases will be rather considered as “suspension” cases. This also means that it will not be possible to hold in abeyance (pending) the application until the submission of the registration permission (but maximum for six months from the submission). In case the seller keeps its ownership right until the payment of the price, the land registry office will suspend the procedure maximum until six months from the date of submission. Furthermore, the so-called ‘not authentic’ land registry extract will be eliminated, as it is not complying with the regulations of electronic documents in force.

The new rules of the land register also affect the activities of the attorneys, since the legislator will require professional training and additional liability insurance from the attorneys, and also the activity of the attorney with gross negligence must be resulted in a disciplinary sanction.

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