Hungary: Deadline for mandatory raise of subscribed capital expires on the ides of March

The moratorium defined in the Hungarian legal regulations for raising the share capital of limited liability companies (in Hungarian: “Korlátolt felelősségű társaság” or simply “Kft.”) up to the new minimal level of 3 million Hungarian Forints as per the provisions of the new Hungarian Civil Code, will expire on the 15th March 2016.

Foreign investors, businessmen and other persons having business or other interests (being members of the company, managing directors, members of the supervisory board etc.) in a limited liability company registered in Hungary which may be affected by the above regulation (i.e. the share capital / subscribed capital of which is below HUF 3 million) are advised to ensure the lawful operation of the company in question, to be in conformity with the currently effective Hungarian laws, prior to the expiration of the above deadline. Otherwise the company court might, in a judicial supervisory proceeding, impose a financial penalty in the amount of HUF 100,000 to HUF 10 Million on the company, respectively on its executive officer (managing director).

Ensuring the lawful operation can be achieved primarily through capital raise, but other options are also available for the companies.

Please contact us for more information:

A. Thomas Squarra

Email: info@squarra.hu

Website: www.squarra.hu

Telephone: +36 1 474 20 80