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The Supreme Court of Hungary recently put an end to a long debate amongst legal practitioners and academia. In its decision No. 1/2021 PJE, the court confirmed that an agreement cannot be considered null and void only because it was signed on the basis of a power of attorney by:

The concept of “rust zones” was introduced by the Hungarian legislation in 2020, covering neglected area reserves. Rust zones, due to the expansion of the cities, are now wedged into the urban environment and are mainly unused due to previous pollution typically resulting from industrial activities. By applying a reduced VAT rate of only 5% and other economically stimulating regulatory elements, these zones can become valuable to investors again and can be reused and reintegrated into the cities. By doing so, the goal is to encourage the construction of affordable, new housing and creating construction jobs which can provide significant help to the construction industry weakened by the effects of the coronavirus pandemic.

A new Government Decree enters into force on 5 May 2021 about the creation of a free (state financed) data erasure application. The National Media and Infocommunications Authority (NMHH) is currently working on the application; their goal is to create a user friendly and secure software until 1 May 2021, which the public will be able to download form the site of the NMHH free of charge.

Government Regulation 261/2011 brought with it considerable changes with effect from 1 January 2021, shifting control and reporting obligations for transport into and out of Hungary to consignors/consignees. The new law has caused uncertainties on the market. Based on initial experience with the new law and discussions with the responsible authority by the Noerr Commercial Trade and Digital Business team, some light can now be shed on the proper application of the new regulation.

In 2014 Hungary introduced the advertisement tax as a direct business tax that must be paid by media content and service providers and publishers of advertisements. The tax base was the net sales revenue originating from the taxable activities in the tax year, i.e. the turnover and not the profit, and a progressive tax rate was established originally with six tax rates between 0% and 40%. The Advertisement Tax Act also provided that taxable persons whose pre-tax profits for the 2013 financial year were zero or negative, could deduct from their 2014 taxable amount 50% of the losses carried forward from the earlier financial years (“mechanism for partial deductibility of losses carried forward”).

Akin Gump, Bogdanovic, Dolicki & Partneri, Maric & Co, Isailovic & Partners, Harrisons, Zdolsek Attorneys at Law, Boga & Associates, Popovski & Partners, and Forgo Damjanovic & Partners have advised Croatian conglomerate Fortenova Grupa d.d., on the EUR 615 million sale of its frozen food business to Nomad Foods. Norton Rose Fulbright, Lakatos, Koves & Partners, and five firms from the SEE Legal alliance advised Nomad Foods on the deal, which is expected to close in the third quarter of 2021.

For our Checking In feature, we reach out to partners and heads of practice across CEE to learn how specific practice areas are faring in their jurisdictions. This time around we asked Tax experts: What are the most important changes to the Tax laws in your country since January 2020 and what has their impact been? 

Hungary Knowledge Partner

Nagy és Trócsányi was founded in 1991, turned into limited professional partnership (in Hungarian: ügyvédi iroda) in 1992, with the aim of offering sophisticated legal services. The firm continues to seek excellence in a comprehensive and modern practice, which spans international commercial and business law. 

The firm’s lawyers provide clients with advice and representation in an active, thoughtful and ethical manner, with a real understanding of clients‘ business needs and the markets in which they operate.

The firm is one of the largest home-grown independent law firms in Hungary. Currently Nagy és Trócsányi has 26 lawyers out of which there are 8 active partners. All partners are equity partners.

Nagy és Trócsányi is a legal entity and registered with the Budapest Bar Association. All lawyers of the Budapest office are either members of, or registered as clerks with, the Budapest Bar Association. Several of the firm’s lawyers are admitted attorneys or registered as legal consultants in New York.

The firm advises a broad range of clients, including numerous multinational corporations. 

Our activity focuses on the following practice areas: M&A, company law, litigation and dispute resolution, real estate law, banking and finance, project financing, insolvency and restructuring, venture capital investment, taxation, competition, utilities, energy, media and telecommunication.

Nagy és Trócsányi is the exclusive member firm in Hungary for Lex Mundi – the world’s leading network of independent law firms with in-depth experience in 100+countries worldwide.

The firm advises a broad range of clients, including numerous multinational corporations. Among our key clients are: OTP Bank, Sberbank, Erste Bank, Scania, KS ORKA, Mannvit, DAF Trucks, Booking.com, Museum of Fine Arts of Budapest, Hungarian Post Pte Ltd, Hiventures, Strabag, CPI Hungary, Givaudan, Marks & Spencer, CBA.

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