In an aim to simplify state administration and support economic
growth, the Hungarian Parliament adopted a new law abolishing the
registration fee and the publication cost for incorporating limited
liability companies ("LLC")
társaság), limited partnerships
(betéti társaság), general
partnerships (közkereseti társaság),
and sole entrepreneurships (egyéni cég). The
new law becomes effective on 16 March 2017.
The most popular legal form among start-ups in Hungary is the
LLC. The LLC has considerable advantages, such as the limited
liability of its shareholders, low mandatory share capital, simple
modification of the corporate structure, and others. Until now, the
registration fee for establishing an LCC was HUF 100,000
(approx. EUR 330), and HUF 50,000 (approx. EUR 165) if
the LCC was incorporated in a simplified procedure by using the
statutory template articles of association. The registration fee
was HUF 50,000 for establishing a limited partnership or general
partnership and HUF 15,000 (approx. EUR 50) for sole
entrepreneurships. The registration fee for establishing a
closely-held company limited by shares
részvénytársaság) remains HUF
100,000 (approx. EUR 330) and HUF 50,000 (approx. EUR 165) for the
incorporation in a simplified procedure. The publication cost
(payable for publication in the Companies Gazette of the court
order on the incorporation) was HUF 5,000 (approx. EUR 16) for all
companies regardless of legal form, except for LLCs incorporated in
a simplified procedure, for which there was no publication cost
applicable to date.
In addition to these changes, the new law also amends the
registration fee that companies must pay when registering a change
in share capital. Previously the registration fee was 40% of the
fee payable upon the establishment of the company. Under the new
law, the fee will be HUF 15,000 (approx. EUR 50) for all the
aforesaid types of companies affected by the abolishment of the
registration fee and the publication cost. In the case of an LLC,
this means that the registration fee will decrease from HUF 40,000
(approx. EUR 133) to a flat fee of HUF 15,000 (approx. EUR 50).
The new rules may encourage the establishment of new companies
by removing an additional financial burden. In addition, LCCs will
no longer have a competitive disadvantage over other types of
companies as regards registration costs.
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.
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