Tue, Nov
55 New Articles

From 1 January 2024, companies operating in Hungary will face new significant cyber security related obligations under the Hungarian legislation implementing the EU NIS2 Directive. In this short article, we describe which companies will be affected by the new regulation and what are the most important tasks in the new year.

The Hungarian Whistleblower Protection Act has entered into force this July. While bigger companies have to operate the internal whistleblowing system since the above date, medium sized businesses (50-250 employees) were given a prolonged period until the 17th of December 2023 to implement the reporting channel. Since the deadline is approaching, we summarize how Hungarian SMEs can comply with the Act.

In a recent decision, the Hungarian Supreme Court had to decide in case, where the amount called by the beneficiary of the guarantee was more than the actual costs incurred. Does call on the bank guarantee shall be proportionate to the costs actually incurred? Shall the beneficiary settle accounts with the debtor after the bank guarantee has been called?

The draft of the new Hungarian Construction Act was recently published for public consultation. Although the act only lays down the general rules, and details will be laid down in other regulations that are not yet known, several new features can already be seen in the draft. In our short article we summarise a few important changes.

When we consider the validity of a contract on the basis of the parties' will, it is usually the will at the time of the conclusion of the contract that is relevant. In a recent decision, however, the Supreme Court of Hungary has pointed out that in the case of a long-lasting legal relationship, such as an employment relationship, the parties' actions after the conclusion of the contract in order to perform it must also be taken into account when determining the contractual intention.

The company name is an important asset of the company and also helps the customers when choosing between products or services. Therefore, a new company can only be founded with a name that is sufficiently different from existing companies. What are the legal options for a company if, despite the above, a new company with a very similar name has been registered?

The Hungarian Labour Code specifies that the dismissal by the employer may be in relation to the behaviour of the employee, but it does not specify exactly what kind of behaviours can be considered. The question arises as to whether the employer can define the possible reasons for termination in its own regulations, if so, can the termination be based solely on the violation of the internal regulations? In our article, we analyse this question based on the recent decision of the Supreme Court.

There is no doubt that the coronavirus pandemic was a fundamental shock to the Hungarian economy. Many business operators have tried to reduce their losses by terminating contracts, referring to the coronavirus as force majeure cause and there have now been more court decisions in such cases. A recent one deals with the question whether a long-term framework contract may be terminated because of the impossibility of the performance, invoking the coronavirus as a force majeure.

In June 2023 Hungary introduced a new ground for annulling construction arbitration awards, which applies where arbitrators fail to deliberate the opinion of the Performance Certification Expert Body. Will this amendment affect so negatively Hungarian construction arbitrations as believed by many commentators? This article argues that paradoxically, the new law can even strengthen the position of arbitration as alternative dispute resolution method in construction matters.

Under Hungarian law the judge can reduce the amount of the contractual penalty if it is excessive. The penalty reduction shall be expressly requested by the defendant during the litigation. Can the defendant submit such request at any time during the litigation, or is there any deadline for that? In a recent decision, the Hungarian Supreme Court addressed this issue.

Social media platforms significantly changed the ways how people express their opinions: sharing views became easier than ever. On the one hand, this is positive, but on the other hand, it is also dangerous in the employment context, as the employee's opinion may be prejudicial to the employer's interests. A recent decision of the Hungarian Supreme Court gives answer to the question whether the employer can dismiss the employee for expressing his opinion on Facebook.

The Hague Convention on the Recognition and Enforcement of Foreign Judgments in Civil or Commercial Matters (“Convention”) entered into force on 1st September 2023 in all EU countries (except Denmark). What impact will the Convention have in relation to the enforcement of third country judgments in Hungary and the enforcement of Hungarian judgments in third countries?

The position and tasks of the employee are one of the key elements of the employment contract and are typically recorded in the job description. It is often a matter of dispute between the parties whether the employer can unilaterally modify the job description at all, and if so, to what extent. In a recent court decision, a Hungarian appellate court addressed the above question in a situation where the employer supplemented the employee's tasks with new tasks similar to his existing tasks. In this article, we analyse the recent decision on this matter.

In business life parties often use promissory notes to secure transactions since these instruments allow creditors to get back their money rapidly and easily. What special regime applies to promissory note litigations in Hungary? This article summarises the Hungarian promissory note litigation regime.

It is not uncommon for an employee to disagree with and criticise his superior. In this case the fundamental right to freedom of expression of the employee competes with his obligation to co-operate with his colleagues. Further, there are cases where the criticism by the employee is not protected by the freedom of expression and may be ground for dismissal, as shown by a fresh decision of the Hungarian Supreme Court analysed in this short article.

With the Schrems II judgment, which invalidated the Privacy Shield, the CJEU (Court of Justice of the European Union) make it more difficult to comply with the GDPR for companies transferring personal data from the EU to the US. However, the new EU-US Data Privacy Framework (or “Framework”) adopted on 10 July aims to put an end to this situation. But how does the Framework make data transfers between the EU and US easier? In this short article, we explain the basics of the new Framework and answer the above question.

Based on the GDPR, data controllers have several obligations, such as maintaining the records of data processing or in case of joint controllers, entering into an agreement which determines their respective responsibilities for compliance with their data protection related obligations. In a recent case, the Court of Justice of the European Unio (‘CJEU’) needed to decide on the issue whether the non-compliance with these obligations constitutes unlawful processing resulting in the duty to erase the personal data of the data subject.

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SMARTLEGAL Schmidt & Partners at a Glance

SMARTLEGAL Schmidt & Partners is a Hungarian boutique law firm serving international and domestic corporate clients doing business in Hungary.

Besides our strong focus on litigation and arbitration in domestic and cross-border matters, we advise clients in employment law, construction & real property law, corporate law, in M&A transactions, and in IP and IT law.

Our sector knowledge covers the automotive industry, infrastructure and real estate development sector, the logistics & transportation industry, and the technology, media & telecommunications sector.

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  • you do not like "legalese"
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