In an aim to simplify state administration and support economic growth, the Hungarian Parliament adopted a new law abolishing the registration fee and the publication cost for incorporating limited liability companies ("LLC") (korlátolt felelősségű társaság), limited partnerships (betéti társaság), general partnerships (közkereseti társaság), and sole entrepreneurships (egyéni cég). The new law becomes effective on 16 March 2017.

The most popular legal form among start-ups in Hungary is the LLC. The LLC has considerable advantages, such as the limited liability of its shareholders, low mandatory share capital, simple modification of the corporate structure, and others. Until now, the registration fee for establishing an LCC was HUF 100,000 (approx. EUR 330), and HUF 50,000 (approx. EUR 165) if the LCC was incorporated in a simplified procedure by using the statutory template articles of association. The registration fee was HUF 50,000 for establishing a limited partnership or general partnership and HUF 15,000 (approx. EUR 50) for sole entrepreneurships. The registration fee for establishing a closely-held company limited by shares (zártkörűen működő részvénytársaság) remains HUF 100,000 (approx. EUR 330) and HUF 50,000 (approx. EUR 165) for the incorporation in a simplified procedure. The publication cost (payable for publication in the Companies Gazette of the court order on the incorporation) was HUF 5,000 (approx. EUR 16) for all companies regardless of legal form, except for LLCs incorporated in a simplified procedure, for which there was no publication cost applicable to date.

In addition to these changes, the new law also amends the registration fee that companies must pay when registering a change in share capital. Previously the registration fee was 40% of the fee payable upon the establishment of the company. Under the new law, the fee will be HUF 15,000 (approx. EUR 50) for all the aforesaid types of companies affected by the abolishment of the registration fee and the publication cost. In the case of an LLC, this means that the registration fee will decrease from HUF 40,000 (approx. EUR 133) to a flat fee of HUF 15,000 (approx. EUR 50).

The new rules may encourage the establishment of new companies by removing an additional financial burden. In addition, LCCs will no longer have a competitive disadvantage over other types of companies as regards registration costs.