The Hungarian Government will do everything possible to protect the Land Act, which includes several elements from the laws of other European countries, Minister of State for Public Administration Attila István Simon of the Ministry of Agriculture said on Thursday in Budapest.
At a press conference organised with relation to the European Commission’s infringement procedure against Hungary concerning restrictions on land use by foreigners, the Minister of State predicted that the European Court of Justice could issue a ruling on the case in the summer of 2016.
Mr. Simon emphasised that accounts must be settled with those affected according to the regulations of civil law, despite the fact that the Act on Land Trade does not include stipulations in this regard.
The background to the case includes that fact that foreigners and legal entities, including Hungarian legal entities, have been unable to purchase farmland in Hungary since 1994. The next step occurred in 2001, when it was made illegal to sign new usufruct agreements with regard to farmland.
The latter measure was required because foreigners had begun signing usufruct agreements with Hungarian landowners, thus acquiring the use of the farmland while circumventing existing regulations. However, contracts of this nature signed prior to 2001 continued to be valid, right up until May of this year, when the new legislation adopted in December of last year came into force, which terminates all usufruct agreements that are not concluded between close relatives.
In February of this year, Austria turned to the European Commission because of the new law. Two pilot procedures have been performed so far, which consisted of replying to questions sent to Hungary. The current procedure confirms that the Commission is unhappy with the Hungarian legislation and has requested a reply within two months.
The Commission could issue a justified opinion next spring, after which the case could go before the Court in Luxembourg, the Minister of State said, explaining the procedure.
The conscience of the Hungarian Government is clear; it will protect Hungarian farmland from speculators, the Minister of State added.
In reply to a question form Hungarian news agency MTI, Mr. Simon said that property in Hungary is registered on a total of 2.5 million topographical lot numbers, of which 225 thousand are affected by usufruct agreements. It is, however, unknown how many of these usufruct agreements have not been concluded between close relatives, meaning they are speculative in nature. Without this information, it is also impossible to assess the area of land affected by the new legislation.
(MTI Hungarian News Agency)
