In this article we summarise the legal frameworks of arbitration in Hungary.

International law

Hungary is party to the most important international arbitration treaties. Hungary has signed and ratified:

  1. the Convention on the Recognition and Enforcement of Foreign Arbitral Awards of 1958 (New York Convention)1;
  2. the European Convention on International Commercial Arbitration of 1961 (Geneva Convention)2;
  3. the Convention on the Settlement of Investment Disputes between States and Nationals of Other States of 1965 (ICSID Convention)3
  4. the Energy Charter Treaty of 19944.
  5. almost 60 (sixty) bilateral investment protection treaties with different European and other countries.

National Law

First of all, the Brussels I Regulation (Recast)5 must be mentioned, which forms integral part of the Hungarian legal system. Even if the Brussels I Regulation excludes arbitration from its material scope, its provisions and the related case law can be relevant in international arbitral proceedings.

The basic national source of law in the field of arbitration is Act LX of 2017 on Arbitration ("Arbitration Act"), which entered into force on 1st January 2018 and repealed the former arbitration act. The Arbitration Act was drafted in the light of the UNCITRAL Model Law, as revised in 2006, and the vast majority of its provisions are in line with the latter.

The Act XXVIII of 2017 on Private International Law ("PIL Code") entered into force on 1st January 2018, and it contains important choice-of-law provisions in relation with the law applicable to arbitration agreements, and it also regulates the recognition and enforcement of foreign arbitral awards.

In addition to the above, Act CXXX of 2016 on the Civil Procedure Code ("Civil Procedure Code") and Act LIII of 1994 on Judicial Enforcement ("Enforcement Act") also regulate certain issues in relation with the arbitration procedure and concerning the enforcement of arbitral awards.

Institutional law

Besides national law, the rules of procedures of the permanent arbitration institutions play key role. From 1st January 2018, there are 3 (three) permanent arbitration institutions in Hungary:

  1. the Permanent Commercial Arbitration Court attached to the Hungarian Chamber of Commerce and Industry ("HCCI").6;
  2. The Permanent Arbitration Court for Sport;
  3. the Arbitration Court attached to the Hungarian Agricultural Chamber.

Although each of the above arbitration institutions has its own rules of procedure, which contains important rules regarding arbitration proceedings, in the framework of this e-book, considering the focus on commercial arbitration we only present the Rules of Procedure of the HCCI ("Rules of Procedure").

Case law

The case law of state courts and arbitral tribunals has growing importance in the field of arbitration in Hungary.

In Hungary disputes concerning the appointment or challenge of arbitrators, the jurisdiction of arbitral tribunals, and the review of awards belong to the exclusive competence of the Metropolitan Court of Budapest, which guarantees the specialized knowledge of judges needed in arbitration related litigations. Court decisions are published frequently in law journals, and we refer to them in this e-book in case the decision is still relevant, after the entering into force of the Arbitration Act.

The mandatory publication of arbitral awards rendered in the framework of the Permanent Commercial Arbitration on the website of the latter is a novelty of the Arbitration Act, and it will be a useful tool for practitioners.

Footnotes

1  The New York convention was promulgated on22th October 1962 by Law Decree No. 25 of 1962.

2 The Geneva Convention was promulgated on 26th March 1964 by Law Decree No. 8. of 1964.

3 The ICSID Convention was promulgated on 7th March 1989 by virtue of Law Decree No. 9 of 1989.

4 It was promulgated on 8th April 1999 by Act XXXV of 1999 in Hungary.

5 Regulation (EU) No 1215/2012 of the European Parliament and of the Council of 12 December 2012 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters)

6 This institution is the legal successor of three formerly independent arbitration institutions, namely, the Arbitration Court attached to the Hungarian Chamber of Commerce, the Arbitration Court of Money and Capital Markets and Arbitration Court of Energy

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.