European Commission

 

Enforcement fiche for Hungary

B a c k

I. ADMINISTRATIVE ENFORCEMENT
Which administrative mechanisms are available to enforce the UCP Directive?

1) Procedure of the Hungarian Authority for Consumer Protection ("HACP"): the HACP is entitled to act in the case of any kind of unfair commercial practice (provided that HCA or CBH are not competent). 2) Procedure of the Hungarian Competition Authority ("HCA"): the HCA is entitled to act in connection with unfair commercial practices if the commercial practice is suitable for influencing the competition (unless such unfair commercial practice only relates to the label of the product, the instructions for use, the warranty voucher or the information obligation set out in § 7 (3) of the Act on Prohibition of Unfair Commercial Practices); 3) Procedure of the Central Bank of Hungary ("CBH"): the CBH is entitled to take action in connection with unfair commercial practices if such commercial practice is connected to the activity of the trader supervised by the CBH.

Who can file administrative complaints?

1) Any consumer or stakeholder or social organs representing consumers' rights are entitled to take action in front of the HACP, as well as the competent bodies of other EEA countries in the case of breach of the UCP directive (§ 46 (2) of Act on Consumer Protection); 2) Any person/entity is entitled to make an announcement or complaint at the HCA (§ 43/G of Act on Prohibition of Unfair Market Practices and Restriction of Competition); 3) Any natural or legal person or any organisation without legal personality whose rights or obligations may be affected, is entitled to take action in front of the CBH, as well as the competent bodies of other EEA countries in the case of breach of the UCP directive and foreign financial supervisory authorities if their scope of duties is affected (§ 81 (1)-(3) and § 82 of Act on Central Bank of Hungary).

Do any specific procedural requirements apply to filing administrative complaints?

Complaints can be filed with the HCA on the complaint form published on the home page of the HCA (http://www.gvh.hu/gvh/alpha?do=2&st=1&pg=77&m5_doc=4257&m81_act=1). Complaints can be filed with the CBH by mail, fax, personally or electronically by using the complaint form published on the home page of CBH, but solely after being unsuccessful in trying to solve the issue directly with the opposing party. No specific procedural requirements apply to filing administrative complaints with the HACP, thus the general provisions of Act no. 140 of 2004 on Administrative Authority Proceedings applies in this regard (i.e. complaints can be filed in writing or orally).

Do the administrative authorities have an obligation to investigate the complaint?

The authorities have an obligation to investigate the complaint provided that no reason for refusal of the complaint set out in Act on Administrative Authority Proceedings applies. The authorities are obliged to clear up the facts of the case to the extent as necessary for passing a decision. (§ 29, 30 and 50 of Act on Administrative Authority Proceedings)

Are there any specific requirements regarding the provision of evidence to the competent authorities?

No.

II. ENFORCEMENT THROUGH COURT ACTION
Which court actions are available to enforce the UCP Directive?

There are no specific court actions to enforce the UCP Directive. According to the reasoning of Act on Prohibition of Unfair Commercial Practices, court actions would be too slow and expensive for this purpose and do not represent a real alternative to the administrative proceedings due to the Hungarian judicial traditions. A general claim for civil damages can be filed before the civil courts.

Who can start a court action?

Any triable person can file a claim for civil damages if damage was caused by the unfair commercial practice. The Act on Consumer Protection establishes that the consumer protection authority, the social organs representing consumers' interest or the public prosecutor are entitled to initiate a lawsuit if an unlawful activity affects a large number of consumers or causes significant damage. The defeated party is obliged to satisfy the claims of the customer as ordered in the judgement. In its judgement the court might entitle the prevailing party to publish the judgement in a national daily paper on the cost of the defeated party.

Can court actions be initiated by competitors?

Yes, if damage was caused by the infringing activity to the competitor, theoretically it may initiate a court action against the infringing party, however, in practice the party initiating such action would most probably face significant evidencing problems in front of the court.

Can the case be handled through an accelerated procedure?

No.

Are there any specific requirements regarding the provision of evidence to the court?

No, there are no specific provisions in this regard.

III. SANCTIONS
What are the possible civil sanctions and remedies for the infringement of the UCP provisions?

The court might order the party infringing the UCP provisions to pay compensation if damage was caused and this can be evidenced in the course of the court proceedings.

What are the possible criminal sanctions for the infringement of the UCP provisions?

The relating legal provisions do not apply criminal sanctions for the infringement of the UCP provisions. However, the operation of an undertaking infringing the UCP provisions might at the same time qualify as a criminal act of deception of consumers under § 417 (1)-(2) of the Criminal Code: Any person who conveys misleading information during a product presentation on the availability of special discounts or price reductions, or on the chance of winning is guilty of misdemeanor punishable by imprisonment not exceeding one year. Any person who before large public states false facts, or true facts in a deceptive way, or provides deceptive information on any essential feature of the product for the purpose of promotion, or if it involves goods of substantial quantity or value, is guilty of misdemeanor punishable by imprisonment not exceeding two years.

What are the possible administrative sanctions for the infringement of the UCP provisions?

1) The CPA is entitled to (i) order the cessation of the infringement of law, (ii) prohibit the unlawful behaviour, (iii) order the termination of the deficiencies and disparities discovered (iv) prohibit or subject to certain conditions the distribution or sale of the goods, (v) under certain circumstances order the temporary closure of the commercial establishment, (vi) impose a fine. 2) The HCA is entitled to (i) establish that the commercial practice is contrary to law, (ii) order the cessation of the infringement of law, (iii) prohibit the unlawful behaviour, (iv) prescribe certain obligations (e.g. order the parties to enter into a contract), (v) order the publication of a statement of correction, (vi) impose a fine. 3) The CBH is entitled to (i) take measures to comply with the law or to eliminate the discrepancies discovered, (ii) order the cessation of the infringement of law, (iii) prohibit the unlawful behaviour,  (iv) order to terminate the deficiencies and disparities discovered, (v) ban or impose conditions on the activities of the infringer, or (vi) impose a fine.

What are the contractual consequences of an administrative order or a judgement relating to an unfair commercial practice on an individual transaction?

Under certain circumstances, the court might establish in accordance with the general provisions of civil law that a consumer contract is null and void. Furthermore, on the basis of an effective administrative order or judgement, the complainant may file a request for compensation, in which case the order or judgement will constitute sufficient evidence to decide whether or not to award the compensation.

How can consumers get redress/compensation (e.g. through collective actions)?

By means of court proceedings, or through collective actions (i.e. where the violation of consumer protection regulations by a person affect a wide range of - personally unknown - consumers whose general identity can be established relying on the circumstances of the infringement, the consumer protection authority or the associations for the protection of consumers' interests have the right to bring a so-called "civil action" to the court - § 38 of Act on Consumer Protection. N.B. this type of action is not equivalent with the Anglo-Saxon "class action").

Can the administrative authorities or the courts require the publication of their decisions?

The administrative authorities publish their decisions.

IV. OTHER TYPES OF ENFORCEMENT
Are there any self-regulatory enforcement systems in your jurisdiction that deal with aspects of the UCP Directive?

There are several self-regulatory organisations representing consumers' interests. The most relevant organisations are: 1) National Association for Consumer Protection in Hungary (www.ofe.hu), which operates advisory offices and makes the reporting of complaints possible. The Association is entitled to initiate a lawsuit if the unlawful activity affects a large number of consumers or causes significant damage. 2) Self-Regulating Advertising Association (www.ort.hu), which examines advertisings and requests the advertisers to comply with the legal provisions if necessary. The Association also makes onlie reporting of complaint possible.

Are there any mediating services that deal with aspects of the UCP Directive (e.g., an ombudsman)?

1) The Act on Consumer Protection establishes a Conciliation Body which is entitled to act in connection with disputes relating to the quality, safety of the product, the product liability rules or the contract between the parties. The Conciliation Body aims at out-of-court settlement of the dispute and effective enforcement of consumers' claims. The Conciliation Body is an independent body operating at the commercial and industrial chambers. 2) A claim can be filed with the Representative of Communications Consumer Rights if the activity of the service provider infringed or jeopardized the rights of a consumer. The Representative is obliged to investigate the complaints. The Representative might inform the consumer of its rights and remedies, request the service provider to terminate the infringement or to take an action, or initiate administrative proceedings. 3) The Financial Arbitration Board of the Central Bank of Hungary (FAB) shall attempt to reach a conciliation agreement in consumer disputes of a financial nature. The FAB deals with disputes between consumers on the one hand and persons or organisations on the other hand that fall under the scope of the acts listed in § 39 of Act on Central Bank of Hungary. In order to initiate proceedings at the FAB the consumer needs to first turn to the opposing person or organization to reach a peaceful settlement, and only in case of being unsuccessful can the consumer file a written complaint to the FAB. Finally, as to the actions the FAB is entitled to take, it may (i) effectuate a peaceful settlement between the parties, (ii) adopt a binding decision, or (iii) make a recommendation on the merits of the case.