Hungary to implement new laws on registration and termination procedures of legal entities in 2027

On 1 January 2027, Hungary will replace the current laws regulating the registration, supervision and termination of legal entities with new legislation. These new laws will streamline and centralise the registration and oversight of legal entities, introducing new procedures and mechanisms to ensure their increased level of compliance.

Hungary’s parliament has just adopted two acts implementing these systematic changes, the most important elements of which are the following:

• Unified registration system: the registration of all legal entities (i.e. all types of business associations, the Hungarian branch offices of foreign enterprises, the Hungarian commercial representative offices of foreign enterprises, associations, foundations, bailiff offices, public notary offices, etc.) will take place in a unified registry managed by a newly established, central administrative authority instead of the courts. Courts will remain responsible for the registration of a few special legal entities (e.g. political parties), but in general the main competence of courts will be the judicial supervision of the lawful operation and winding-up procedures of legal entities.
• Administrative rules: Act CL of 2016 on General Public Administration Procedures (Ákr.) will become applicable in the registration procedures of legal entities in matters not regulated by the new acts.
• Confidentiality of registration documents and data: not all registration documents and corporate data of legal entities will be publicly accessible, and a separate procedure will be introduced for the disclosure of confidential documents.
• Automatic decision-making procedure: as a general rule, the registration of changes in the corporate data of legal entities will be an automated procedure in which the system will not check the lawfulness of registration documents. Instead, registration documents will be supervised by courts ex-post as a supervisory authority. It will be the obligation of the legal counsel to check the consistency between registration documents and the corporate data to be registered in the legal entities’ registry.
• Automatic notification mechanism: legal entities will receive automatic notification about their soon-to-expire company data (e.g. the expiring mandates of executive officers).
• Incorporation of the financial statement publishment portal: the portal for the publishing of annual financial statements of legal entities will become a "sub-register" of the legal entities’ registry.

For more information on your Hungary-based company’s obligations regarding new legislation, contact your CMS client partner or these CMS experts.