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Constitutional court annuls court ruling on MNB fine for market manipulation

The Constitutional Court annulled on Tuesday as unconstitutional a January 2014 court ruling, which declared justified a fine levied by the National Bank of Hungary (MNB) on news portal and daily Napi Gazdaság for illegal market manipulation, Hungarian news agency MTI reported today.

At the same time the Constitutional Court did not annul the MNB fine, saying that the MNB resolution has to reviewed again, and a ruling must be taken by the court.

The MNB fined the publisher Napi Gazdaság Kiadó and news portal HUF 3m each for illegal manipulation of the market in November 2013. The latter publisher filed a constitutional complaint after the court confirmed the MNB resolution.

The Constitutional Court said that the case affected basic rights such as the freedom of speech and the media on the one hand, and the ban on market manipulation which aims to ensure the undisturbed operation of capital markets, on the other. The publication of true facts, background or related information could be termed unsubstantiated or misleading only in exceptional cases, when the press proceeds in bad faith, the Constitutional Court said. It also noted that the case also concerned the right to information on public affairs as it was related to information concerning MOL, one of Hungary's biggest companies, with a significant state-owned stake.

The Budapest public administration and labour affairs court failed to consider these aspects of constitutionality in its ruling, the Constitutional Court said, stating that courts have the constitutional duty to reduce any limitation of the basic rights to the necessary and proportional minimum.

The MNB launched an investigation over an article published first by the news portal, and later by the daily, in October 2013, which said Norway's Oil Fund could in principle consider selling its 1.6pc stake in Hungarian oil and gas company MOL because ethics rules do not allow it to hold shares of companies suspected of corruption. The price of MOL shares fell 6pc in the morning that day in active turnover, though MOL pared losses later in the session. An international arrest warrant has been issued for MOL's chief executive on suspicion he bribed Croatia's former prime minister to give MOL management control over Croatian peer INA.

MNB took over financial market supervision from PSZAF on October 1, 2013, when PSZAF was integrated into the central bank.