Economy
Hungary Constitutional Court rules cenbank law change unconstitutional
The Constitutional Court referred the law amendment passed on 1 March to the Constitutional Court for review, which was a rare act of defiance from János Áder’s part.
The President said
"The bill does not detail ... access to which data can be restricted and which cannot," Peterfalvi said, referring to companies owned by the MNB.
The central bank set up six educational foundations, granting them about HUF 245 billion in 2014. It also partly or wholly owns business units such as the Budapest Stock Exchange (BSE) where it bought a majority stake last November.
An amendment to the Central Bank Act, reportedly initiated at PM Viktor Orbán by MNB Governor György Matolcsy was described by the PM as his "right hand", stipulated that these foundations were now fully controlled by their curators therefore their assets no longer qualified as public.
The new law allows for the data of the bank’s business units to be classified for up to ten years if releasing it is deemed harmful for the MNB’s monetary or foreign exchange policy interests.
The Constitutional Court underlined that the MNB exercises public functions and manages exclusively public funds therefore it is accountable to the public in the spirit of transparency and the virtue of public life. The MNB may set up companies or foundations only in harmony with its tasks and primary objectives therefore the considerations it grants for these entities do not lose their characteristic of public funds, the court added. It reminded that the law amendment would have restricted access to data managed by these companies and foundations.
Consequently, these organisations are obligated to ensure the publicity of their data, the court ruled, adding that there is no constitutional reason why the law should restrict freedom to information therefore the amendment is unconstitutional.
The court also ruled the retroactive effect of the law unconstitutional.
János Lázár told journalist today that after reading and understanding the ruling - i.e. once the government finds out where the law amendment complies and does not comply with the constitution - the cabinet will consider whether there is a constitutional solution. “If there is we’ll give it another try," he said
The President said
the modifications to the MNB Act are incompatible with the constitutional provisions concerning the administration of public finances and information of public interest. Furthermore the retroactive effect of the change does not comply with the constitutional principal of legal certainty.
Attila Péterfalvi, head of the National Authority for Data Protection and Freedom of Information, warned already on the day the law amendment was passed that it was in conflict with the constitution on several points.The fundamental law, the Information Act and laws on national asset management unequivocally stipulate that the activities of the MNB, its businesses and foundations qualify as public tasks and they manage public assets. Therefore the legal restriction must refer to specific data with specific justifications, but access to the data cannot be restricted with respect to each and every activity, he said
Péterfalvi added the transparent operation of public bodies was "a cornerstone of democracy"."The bill does not detail ... access to which data can be restricted and which cannot," Peterfalvi said, referring to companies owned by the MNB.
The central bank set up six educational foundations, granting them about HUF 245 billion in 2014. It also partly or wholly owns business units such as the Budapest Stock Exchange (BSE) where it bought a majority stake last November.
An amendment to the Central Bank Act, reportedly initiated at PM Viktor Orbán by MNB Governor György Matolcsy was described by the PM as his "right hand", stipulated that these foundations were now fully controlled by their curators therefore their assets no longer qualified as public.
The new law allows for the data of the bank’s business units to be classified for up to ten years if releasing it is deemed harmful for the MNB’s monetary or foreign exchange policy interests.
The Constitutional Court underlined that the MNB exercises public functions and manages exclusively public funds therefore it is accountable to the public in the spirit of transparency and the virtue of public life. The MNB may set up companies or foundations only in harmony with its tasks and primary objectives therefore the considerations it grants for these entities do not lose their characteristic of public funds, the court added. It reminded that the law amendment would have restricted access to data managed by these companies and foundations.
Consequently, these organisations are obligated to ensure the publicity of their data, the court ruled, adding that there is no constitutional reason why the law should restrict freedom to information therefore the amendment is unconstitutional.
The court also ruled the retroactive effect of the law unconstitutional.
János Lázár told journalist today that after reading and understanding the ruling - i.e. once the government finds out where the law amendment complies and does not comply with the constitution - the cabinet will consider whether there is a constitutional solution. “If there is we’ll give it another try," he said
