Hungary’s Constitutional Court takes one step forward, two steps back

March 31, 2016

gavel

Hungary’s Constitutional Court today issued two opinions related to separate controversial bills passed by the National Assembly recently. The first decision concerned an emergency bill to hide MNB’s expenditures of public funds, the second decision concerned a bill to hide the Hungarian Postal Service’s contracts with private companies.

Despite being two separate pieces of legislation, both had quite a bit in common:

  • Both were proposed by individual Fidesz MPs
  • Both sought to make secret the use of state assets
  • Both were enacted with the unilateral support of the Fidesz-KDNP governing coalition
  • Both enjoyed the public support of the government
  • Both pertained to cases working their way through Hungarian courts
  • Both would have had a retroactive effect
  • Both were heavily criticized by opposition MPs, civil society, anti-corruption watchdogs and legal scholars; and,
  • Upon being unilaterally adopted by Fidesz-KDNP, President János Áder refused to sign the bills into law, opting instead to send them to the Constitutional Court for review.

One step forward

To the surprise of many Hungarians, the Constitutional Court struck down the bill which would have made secret how the National Bank of Hungary (MNB) and its foundations are using public funds. According to the Court’s decision, this law was unconstitutional because (1) the funds in question are public funds despite being bequeathed to a private foundation, (2) citizens have the right to access information related to the use of public funds, and (3) because the law would have had a retroactive effect.

Two steps back

Regarding the modification to the Postal Service law, the Constitutional Court found the law to be constitutional — but there’s a catch. According to the Court’s decision, lower courts may exercise their own discretion in deciding what kind of data constitutes public information. The Court ruled that the Postal Service provides market services, some of the data related to its activities may constitute business secrets which – if made public – could potentially harm the Postal Service’s business activities.

Strangely, the Constitutional Court did not consider the retroactive effect of this law to be unconstitutional (despite President Áder explicitly mentioning this point when referring the law to the Court).

The Constitutional Court’s ruling on the Postal Service law may set significant precedence as Hungary’s plethora of state-owned enterprises may seek to reject freedom of information requests on grounds that making the information public may give their competitors a distinct advantage in the marketplace.