ITM Responds to AmCham Inquiry Regarding Government Decree No. 227/2020 (V.25)
- June 12, 2020
Subject: Information on interpreting Government Decree No. 227/2020 (V. 25.)
Dear Mr. Farkas Bársony, dear Mr. President,
Let me hereby inform you on the purpose and the context of the regulation to protect companies operating in Hungary in strategic sectors against hostile acquisitions.
In the current economic situation caused by the coronavirus epidemic, by linking the acquisition of companies in Hungary by foreign ownership to an announcement and ministerial investigation procedure, our objective is to protect companies from other companies taking advantage of the difficulties caused by the crisis – by keeping companies under pressure or making their operation impossible – and then buy these companies at a reduced price level. We will support all mergers and acquisitions that are in the interest of all parties (buyer, seller, employees), where we see that the business transaction is based on mutual understanding and a viable vision of a long lasting operation.
The legitimacy of the decree is justified by the fact that it was born on the basis of international practices and EC regulations (32019R0452 – EN). The decree is temporary and is of legal force until the end of this year, i.e. December 31, 2020. The Hungarian regulations are entirely in line with the Italian regulations, and similar regulations are applied in Germany, Poland, France, Spain and Finland, among others.
I also confirm that the Government of Hungary remains committed to cooperating with international companies and supports all investments in Hungary that create value for the investor and the local communities. For further information please visit the website of the Hungarian Investment Promotion Agency under www.hipa.hu.
We hope that an open and direct dialogue with the business will contribute to clarifying any misunderstanding and, as in the past, to successful joint work in the future.
I wish you all the best at your work.
László György, PhD
Minister of State for Economic Strategy and Regulation