The Hungarian Ministry of Justice acknowledged the recent criticism aimed at the difficulties regarding the enforcement of monetary claims in the country and plans to amend the relevant laws to make creditors' lives easier. As currently envisaged, these amendments will in the near future change such fundamental laws as the Civil Code, the act on court enforcement, and the act on insolvency and bankruptcy proceedings. This article provides a summary of the envisaged amendments.
 
Civil Code

The current provision of the Civil Code stipulates that the security interest must be terminated in case of a transfer of the loan agreement, even if the security provider has given their consent. The amended law would foresee that the security interest does not terminate under any circumstances and the consent of the security provider will only be required if the debtor's position changes. It will be possible to implement a change in the creditor's position without the involvement of the security provider.
With the intent of stimulating the market for mortgage-backed instruments, the proposed amendment of the Civil Code might re-introduce the non-accessory mortgage. Such instruments had relied on non-accessory mortgages that were transferable without the transfer of the underlying loan. However, the Civil Code abolished such non-accessory mortgages when it entered into force on 15 March 2014, causing a hiccup in the market for such instruments.    
 
Enforcement Act

The amendments also envision an entirely new act regarding enforcement procedures.  It is not certain which of the several concepts currently floating around will actually make it into legislation. However, the various concepts currently being discussed all have in common the aim of strengthening the powers of creditors. It would be very surprising if some of the ideas currently discussed (eg that the creditors should have the right to freely choose among the bailiffs) were to survive the drafting of the new act; however, others will almost certainly end up being implemented. The most notable examples of this latter group includes proposals that secured creditors should have influence over the sale of the debtor's assets and that creditors should receive detailed information on the debtor's available assets.
 
Act on Liquidation and Bankruptcy proceedings

The legislator also plans to enhance the position of the creditor in insolvency proceedings by amending the relevant act. In the envisioned amendment of the bankruptcy proceeding, creditors may also have the right to initiate the proceeding (NB: currently, only the debtor may apply for the bankruptcy proceeding) and will have the opportunity to comment on the debtor's reorganisation plan or even prepare an alternative one. Debtors would be obliged to file the reorganisation plan together with their bankruptcy application.  
In liquidation proceedings, secured creditors would be granted stronger powers during the sale of the debtor's assets. This may even include the secured creditors being able to proceed with the sale of the encumbered asset by way of self-help.