Brussels is trying to put more pressure on Budapest to repeal a controversial law on NGOs.
In June 2020, the Court of Justice of the European Union (ECJ) struck down the so-called Transparency Act adopted by Hungary in 2017 which forced non-governmental organisations to register if they received foreign donations above a certain threshold.
Non-compliance
In the judgment, the ECJ held that the provisions of the law “constitute indirectly discriminatory measures” as they established “differences in treatment which do not correspond to objective differences in situations.” The court found the Hungarian law to be in breach of EU rules on the free movement of capital and the fundamental rights to protection of personal data and freedom of association, protected by the EU Charter of Fundamental Rights.
The Hungarian law posed a threat to the role of civil society as an independent actor in democratic societies and created a climate of distrust towards them as well as limiting the privacy of donors, the Luxembourg-based EU judges held.
Infringement procedure
Yet more than six months later, the government of Viktor Orbán continues in its refusal to repeal the law. Not only is it still on the statute books, it also continues to be applied by the authorities in Hungary. For example, an NGO’s application for EU funding under the Erasmus+ Programme was rejected last September by the competent Hungarian agency last September because the NGO had not submitted declarations stating that it conformed with the Transparency Law.
This week, the European Commission – which considers itself as the “guardian of the EU Treaties” – 
against the government in Budapest over the issue. The first step in this procedure is a letter setting out the contentious points, to which the Hungarian government has now two months to respond. It could be followed by a so-called “reasoned opinion” and ultimately by another procedure before the ECJ and the application of financial sanctions.
The Commission said Hungary had not taken “the necessary measures to comply with the judgment” of the court, “despite repeated calls from the Commission to do so as a matter of urgency”. Earlier letters sent from Brussels to Budapest had no effect. The Commission believes that the Transparency Act “threatens the role of civil society as an independent actor in democratic societies”.
The Hungarian government reacted to the news by saying it would “perform all necessary measures to comply with the judgement”. Negotiations between Budapest and Brussels on the issue were on-going.
Other controversial measures
However, Hungary is coming under increasing criticism for ignoring other rulings by the EU’s supreme court, including one issued in October regarding a separate law that targeted the Central European University, an institution set up and funded by the Hungarian-born US philanthropist George Soros whom Orbán is accusing of meddling in Hungarian politics. The university left Budapest for Vienna in 2019.
Author: Michael Thaidigsmann
