If a security agent is not appointed before the conclusion of a quota pledge agreement, but the agreement is signed by several pledgees, these pledgees are still entitled to appoint a security agent. However, the Civil Code stipulates that the appointment becomes effective only when the pledgee has been registered as a security agent in the relevant register. This can be problematic, as there is no section on the electronic registration form for doing so.
Under Hungarian law, companies closing their business year on December 31 must publish their annual financial report on or before the following May 31. If a company repeatedly delays performing this obligation, the tax authority will withdraw the company's tax number and inform the competent registration court accordingly. A situation can thus quickly be reached where there are slim chances of keeping the company alive.
A recent Hungarian Competition Authority (HCA) decision concerning Vodafone demonstrates that a reasonable cooperative approach may significantly affect the level of fine imposed on an undertaking, as the HCA reduced the fine imposed on Vodafone by more than 50% based solely on its cooperative measures. Although this case is unique, it signals that compliance and cooperation efforts which exceed the necessary legal requirements do not go unnoticed.
The Hungarian Competition Authority (HCA) was recently given significant new investigative powers under the framework of its merger control duties. Should parties decide not to submit a voluntary filing when meeting the voluntary notification threshold, the HCA can initiate an investigation on its own accord and undertake a fully fledged merger control proceeding. The HCA recently announced that it has commenced its first such ex officio merger control investigation.
Following a Hungarian Competition Authority (HCA) decision that its rebate system violated the Trade Act, retail chain Spar went all the way to the Supreme Court. All judicial forums upheld the HCA's decision and the illegality of such rebates seemed to be settled. However, the Budapest Metropolitan Court recently overturned another HCA decision, which was somewhat surprising considering that the Supreme Court had already upheld the HCA's decision in the relatively similar Spar.
Public procurements are often targets for bid rigging and the Hungarian authorities and legislature have made extra efforts to fight this kind of behaviour. While it is not the primary authority for monitoring public procurements, the Hungarian Competition Authority (HCA) is one authority fighting anti-competitive behaviour in public procurement. Besides investigating violations, the HCA is also taking steps towards prevention and raising awareness.
An important part of the recent major amendment to the Competition Act was the timely implementation of the EU Antitrust Damages Directive into Hungarian law. While it was already possible to claim damages for a competition law infringement under Hungarian law, the directive's implementation introduced special rules for damages claims arising out of competition law infringement and the enforcement of such claims. It also introduced several solutions which are new to Hungarian law.
The Supreme Court recently issued a reasoned opinion on certain legal and procedural aspects of employment-related suits involving equal treatment claims. The reasoned opinion addresses, among other things, the interpretation of the burden of proof in such suits, the equal pay principle, the concept of discrimination based on other grounds and the way of hearing and deciding anti-discrimination claims in suits initiated on the grounds of unlawful dismissal.
Employers are often frustrated by employees' incapacity to work for health reasons, but they must act with care when addressing such situations. In an attempt to protect employee interests, legal regulations provide certain restrictions on what employers can do if an employee is unable to work for health reasons. A recent Supreme Court decision has further clarified some of these restrictions.
Organisations with legal entities and employees in several EU member states often try to centralise their human resources (HR) functions to some extent, which occasionally requires them to share employee and HR data within their group. Although existing Hungarian law provides a stable legal environment with clear rules for employers as data processors, there is a general feeling of uncertainty around this topic, which is partly due to the upcoming entry into force of the EU General Data Protection Regulation.
Although the Labour Code fails to define a 'conflict of interest', its general principles prohibit employees from engaging in conduct which could jeopardise their employer's rightful economic interests. Depending on the circumstances, a conflict may constitute a severe violation of the employee's employment terms and can be punished appropriately. In other cases, a conflict may arise that is not the employee's fault, which can therefore be appropriately rectified without penalties.
The existing Labour Code amended employers' consultation duties in the event of a collective redundancy. When the code entered into force, this change seemed technical and went somewhat unnoticed among other more significant changes. However, the change is important, as it simplifies employers' consultation duties in the absence of employee representative bodies. Simultaneously, the new rule's compliance with EU law has raised questions around how employers should act.
The government is supporting a range of projects to achieve its 2020 renewable energy targets, including Hungary's first small-scale geothermal power plant and an e-mobility action plan. Alongside these sector and project-specific incentives is the mandatory feed-in tariff system – an overall system of incentives for renewable energy intended to subsidise electricity that is produced from renewable, waste and co-generated energy.
In 2003 the feed-in tariff (FIT) system was introduced to subsidise electricity production from renewable, waste and co-generated energy. In January 2008 MAVIR Zrt, which operates the FIT system, established the mandatory feed-in balance group. Electricity producers that are eligible to join the balance group are subject to certain requirements regarding annual production forecasts, payment obligations and takeover terms.
The Hungarian Intellectual Property Office and the Metropolitan Tribunal recently dismissed an opposition of an applied-for mark on the basis that there was no likelihood of confusion. However, the appeals court disagreed, holding, among other things, that an assessment of a likelihood of confusion is more sensitive for conflicting pharmaceutical marks than for marks designating other goods. Although the court's decision is well grounded in Hungarian case law, it has been disputed for a number of reasons.
The owner of the EU trademark ARIEL, registered in Class 3, recently requested the cancellation of the later mark ARILUX, registered for goods in the same class. The Hungarian Intellectual Property Office granted the request and cancelled the ARILUX mark. It found that, as the two word marks had identical beginnings and both consisted of three syllables, there was a strong similarity between them. The Metropolitan Court of Appeal upheld the ruling.
The Hungarian Intellectual Property Office recently rejected an application to register a device mark featuring the term 'DRONEHUNGARY', holding that the mark's wording was descriptive. However, on review, the Metropolitan Tribunal held that a word composition is descriptive only if it is grammatically correct. This is not the first time that the HIPO has been more rigorous than the tribunal in assessing an application, especially with regard to a mark's descriptiveness.
Facebook recently succeeded in opposing an application to register the mark MBOOK before the Hungarian Intellectual Property Office (HIPO), the Metropolitan Tribunal and the Metropolitan Court of Appeal. Although the result of the opposition is unsurprising, the different reasoning of the HIPO and the tribunal, which resulted in the same decision, is notable. Regardless of how the HIPO and the tribunal arrived at their decisions, this case is a good example of the protection afforded to reputed marks.
As it is usually difficult to prove the existence of bad faith in respect of trademarks, case law is often reluctant to apply this prohibition. This was the case with a recent Metropolitan Tribunal case. Fortunately, the Metropolitan Court of Appeal was more flexible in this respect and interpreted the facts concerning bad faith alongside another issue, thus leading to different interpretations of the concept of due cause by the tribunal and the court.