The Hungarian Government adopted the Government Decree no. 163/2025. (VI. 23.) on Monday, 23 June 2025 introducing substantial changes to the so called temporary FDI Regime introduced by Government Decree 561/2022 (XII. 23.). The changes are twofold: (i) the applicable deadlines are significantly extended, and (ii) a statutory purchase option right is granted to the Hungarian State in the case of a prohibition issued by the competent minister. The changes entered into force on 24 June 2025 and are also applicable to ongoing procedures.
New extended deadlines
The deadlines for assessment were significantly extended to allow the competent minister to carry out an in-depth review and assessment of the transaction notified. The deadlines are the following: the competent minister must adopt the decision within 45 business days (previously 30 business days) from the notification which can be extended by further 15 calendar days. In cases where it is needed to clarify the facts, the competent minister can extend the deadline three times, on each occasion, by a further 30 working days.
In addition to the above, the Minister can issue a request for additional information/documents (with a deadline of maximum 20 calendar days), the deadline will be suspended until the request is fulfilled.
Based on the above, we expect that deadlines of the temporary FDI screenings will be significantly longer from now on, due to the above changes, the effective deadline could, in a worst case scenario, be between 6 and 7 months (provided that the deadline is extended by the maximum number of times) compared to 2 months under the previous rules.
The Hungarian State’s option right
In the case of a prohibition of a transaction (for a potential threat or violation of the Hungarian State’s interests, its public security, public order or the safety of supply of basic social needs of its citizens), the Hungarian National Asset Management Company can exercise a statutory option right to purchase the company or asset based on the same conditions as set out in the transaction documents within 90 calendar days from the date of the prohibition.
The vagueness of these new rules give rise to various questions as to how this option right could be exercised, for example, in relation to transactions triggering an FDI filing requirement but which are implemented outside of Hungary.
New law?
The above changes followed a legislative measure adopted by the Hungarian Parliament on 19 June 2025 enacting Act L of 2025 incorporating in one sole act all the government decrees adopted under the State of Emergency in relation to the war in Ukraine. A specific chapter is dedicated to the temporary FDI regime which will remain in force until 31 December 2026. This new act will enter into force on 19 August 2025. However, due to the timing, the changes mentioned above (i.e. re deadline and State’s option right) were not incorporated in this legislative text.
We do not have any information as to whether the new rules will also be incorporated to the Act L of 2025 applicable from 19 August 2025 or will only be applicable during the interim period between now and 19 August 2025.