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Gárdos Füredi Mosonyi Tomori | Hungary | 2 Nov 2012
Financial regulator actively enforces consumer protection laws
The Financial Supervisory Authority (FSA) shows little sympathy for financial institutions that place unfair burdens on consumers, acting as a diligent executor of the most recent consumer protection legislation. It firmly keeps an eye on how institutions observe these rules and penalises any deviation. Three recent cases in particular illustrate the FSA's approach to these consumer......
Gárdos Füredi Mosonyi Tomori | Hungary | 31 Aug 2012
A unique financial transaction act
Parliament recently adopted the Act on Financial Transaction Fees, which becomes effective from January 1 2013. The act designates the levied contribution as a fee, but the contribution does not represent a reimbursement of costs or consideration for a service rendered by the state. As such, it is really no different from a general tax and is commonly called the 'financial transaction tax'.
Gárdos Füredi Mosonyi Tomori | Hungary | 27 Apr 2012
Financial disputes body scores early successes, but controversies remain
Recent statistics show that the new Financial Conciliation Body (FCB) is achieving a large number of successful settlements between consumers and financial service providers. However, concerns remain over the scope of its competence, and over the fact that a consumer who is dissatisfied with an FCB decision may apply to the courts, whereas a service provider may not.
Gárdos Füredi Mosonyi Tomori | Hungary | 23 Mar 2012
Supreme Court rules on unilateral amendment of loan contracts
For the first time, the Supreme Court has examined in detail whether a contractual term that gives a financial institution the right to amend a consumer loan contract unilaterally is consistent with Hungarian law. Financial institutions are already revising their practices and contractual terms as a result.
Gárdos Füredi Mosonyi Tomori | Hungary | 3 Feb 2012
New central bank law comes into effect
On the basis of the Fundamental Law, the Magyar Nemzeti Bank Act 2011 has replaced the Magyar Nemzeti Bank Act 2001. The Magyar Nemzeti Bank (MNB) – the central bank of Hungary – is obliged to adapt its governance and operation to accord with the new law by the end of March 2012. But the new act's changes raise concerns that the government may try to exercise undue political influence over......
Gárdos Füredi Mosonyi Tomori | Hungary | 17 Jan 2012
Supreme Court dismisses claim against distributor of Lehman notes
The Supreme Court has rejected a claim against the exclusive Hungarian distributor of structured notes issued by Lehman Brothers Treasury Co BV and guaranteed by Lehman Brothers Holding Inc. After the issuers and the guarantor became insolvent, their client initiated a lawsuit against the defendant on various grounds, seeking repayment of the notes' face value and the fee paid to the......
Gárdos Füredi Mosonyi Tomori | Hungary | 9 Dec 2011
Parliament introduces cap on interest rates
A new law passed by Parliament introduces an interest rate cap on consumer mortgage loans and regulates the calculation of interest rates. It enables debtors to ask for the amendment of contracts that were concluded before the new law entered into force. In addition, it amends the Civil Code by introducing a mandatory base rate plus a 24 percentage-point cap for contracts where both parties......
Gárdos Füredi Mosonyi Tomori | Hungary | 30 Sep 2011
Parliament passes plan for foreign-denominated debt crisis
One of Hungary's most serious economic problems is that approximately 40% of mortgage loans are denominated in a foreign currency. A new law, allowing for debt repayment at far below market rates, has been criticised as a significant threat to the country's financial system. Moreover, the plan's inbuilt limitations mean that it may help only a small proportion of the debtors affected.
Gárdos Füredi Mosonyi Tomori | Hungary | 16 Sep 2011
Supreme Court provides guidance on early repayment charges
The Supreme Court has confirmed a developing judicial practice in connection with early repayment charges in credit agreements. The court held an early repayment charge to be compensation for lost interest income and therefore deemed it to be null and void; however, it noted that creditors may charge debtors for additional costs incurred as a result of early repayment.
Gárdos Füredi Mosonyi Tomori | Hungary | 17 Jun 2011
Will government's home protection plan rescue borrowers?
Foreign-denominated debt has been called "the biggest ticking bomb in the Hungarian economy". A new plan could offer a lifeline for homeowners who are unable to pay off their mortgages. However, some commentators see it as a flawed stopgap, or even as unethical, while the banking sector is concerned that a cut in the bank levy appears not to be part of the deal.
