A changing investment narrative
Following the 2026 elections and the formation of the new government, international investors, lenders, and sponsors are increasingly re-evaluating Hungary as an investment destination. Early government communications and policy announcements suggest a strong focus on restoring predictability, rebuilding institutional credibility, and re-establishing closer cooperation with the European Union. While many of the proposed measures remain at an early policy stage, several themes are already emerging that may be relevant for investment, financing and transactional activity in the coming period.
EU funds, euro convergence and institutional reforms remain central
One of the clearest priorities of the new administration will be restoring access to suspended EU funding. Government representatives have repeatedly emphasized cooperation with EU institutions, strengthening judicial independence, anti-corruption mechanisms, and broader rule-of-law reforms as key conditions for unlocking significant EU recovery and structural funds. The government has also publicly confirmed its strategic objective of medium-term euro adoption, although without committing to a specific target date at this stage. In parallel, the administration has emphasized broader institutional audit and transparency initiatives across multiple state-linked sectors and public contracting arrangements, signalling an increased focus on accountability, public oversight and institutional restructuring.
From an investor perspective, these developments are relevant not only because of the direct economic impact of EU funding, but also because regulatory predictability, institutional transparency and macroeconomic convergence remain key drivers of long-term investment decisions, particularly in infrastructure, real estate, industrial and project finance transactions.
Administrative and regulatory restructuring
Based on the government’s latest communications, significant reforms are also expected within the Hungarian administrative and public authority system. Current proposals include the review and possible reallocation of competences currently exercised by county government offices (“kormányhivatalok”), alongside broader discussions regarding the role of public sector trade unions and administrative oversight mechanisms. While the precise institutional model remains unclear, the stated objective is to reduce administrative complexity, strengthen accountability and accelerate decision-making procedures. Particular focus is therefore likely to be placed on whether the planned reforms materially improve the efficiency and predictability of permitting, licensing and administrative review procedures relevant to investment projects.
Market attention is focused on whether these institutional reforms could materially affect:
- permitting timelines;
- construction and environmental approvals;
- administrative appeal procedures;
- public procurement administration; and
- state supervision over strategic sectors and concession arrangements.
Insolvency, enforcement and notarial system reforms
A particularly significant development for financing markets and restructuring professionals is the government’s announced review of the enforcement, insolvency and notarial systems. According to the latest communications, multiple legislative reform processes are expected to begin in the coming weeks.
Based on the announcements:
- the current judicial enforcement system may be transformed into a nonprofit model operating under significantly stronger state supervision;
- temporary suspension measures relating to certain eviction procedures may be introduced pending broader enforcement reform;
- insolvency and liquidation proceedings may be brought back under enhanced judicial control and court supervision; and
- reforms of the notarial system are expected to target lower costs, increased transparency and a more service-oriented public-law framework, including the possible transfer of certain routine notarial functions partly to government service centers and partly to courts.
Although these proposals remain at an early stage, they are already highly relevant for financing counterparties because they may directly affect the enforcement timing assumptions, security package valuation and creditor protection mechanisms. Attention is likely to be paid to whether the proposed reforms increase procedural predictability and judicial oversight without materially slowing enforcement efficiency. This may become a key consideration in future Hungarian-law governed financing transactions and security structures.
Possible economic and tax policy changes
Based on early policy communications and public statements, the new government is expected to prioritize fiscal consolidation, budget transparency, and the restructuring of certain elements of the Hungarian tax system.
Among the most closely watched proposals are:
- potential introduction of a form of wealth tax targeting very high net worth individuals;
- possible reduction of VAT on certain essential goods;
- tax relief measures for lower-income earners;
- review of existing extraordinary sectoral or windfall taxes;
- broader efforts to simplify and stabilize the business tax environment.
At this stage, most of these measures have not yet been enacted into law, but they are already starting to shape investor discussions, financing assumptions and early-stage transaction structuring.
Financing markets and investor sentiment
Market participants continue to watch closely whether the anticipated policy shifts may gradually improve Hungary’s perceived investment risk profile. While it is too early to draw firm conclusions, we are already seeing increased exploratory discussions, renewed due diligence activity, and a growing number of re-entry conversations from investors who had previously adopted a wait-and-see approach.
Attention is particularly focused on:
- financing conditions and liquidity;
- regulatory predictability;
- permit and administrative procedures;
- public procurement transparency;
- enforcement and insolvency reform implementation; and
- the practical implementation timeline of announced reforms.
For lenders and sponsors, the speed, credibility and technical implementation of reforms are likely to be more important than announcements alone.
What this may mean for investments
If the announced policy direction translates into practice, Hungary could see increased investment activity in real estate and infrastructure, stronger cross-border financing interest, renewed institutional investor participation, and greater transactional activity linked to EU-funded projects. At the same time, investors will continue to assess execution risks carefully, particularly given the scale of proposed institutional, judicial and economic reforms.
The announced reforms relating to enforcement, insolvency proceedings and notarial functions may also have broader implications for how transactions are assessed from a bankability perspective, as well as for security enforcement structures and the allocation of restructuring risks in Hungarian deals.
Looking ahead
The key question is no longer whether Hungary is back on investors’ radar, it clearly is. The more key question is how quickly the announced reforms and policy objectives translate into practical legal, regulatory and market changes.
At Partos & Noblet, we continue to monitor legislative and regulatory developments, as well as financing trends relevant to domestic and international investors active in the Hungarian market.