UPDATE - Spokesman confirms PM received letter from EC president, does not comment on content

EU

Prime Ministerial Spokesman Peter Szijjarto on Monday evening confirmed a Hungarian press report that Prime Minister Viktor Orban had received a personal letter from European Commission President Jose Manuel Barroso, though declined to provide detail on the content of the letter.

"We do not have the authorization from him to make it public," Mr Szijjarto said.

Online portal Origo.hu reported on Monday that Mr Barroso had sent Mr Orban a letter late last week requesting that the bills on the National Bank of Hungary and on Financial Stability be withdrawn because they are not compatible with European Union law.

Mr Szijjarto said that Mr Orban would send a return letter to Mr Barroso.

Barroso has urged the Hungarian prime minister in a letter to withdraw proposals that could undermine the independence of the country’s central bank, Dow Jones reported on Tuesday citing EU spokeswoman Pia Ahrenkilde Hansen.

"The commission has indeed serious doubts, as the president has conveyed in his letter to [Prime Minister Viktor] Orban, on the compatibility," Ahrenkilde Hansen said.

 In the letter, Mr Barroso said if these laws are found incompatible with EU law they will need to be changed, according to the spokeswoman, adding that he advised Orban to withdraw the proposals.

Olivier Bailly, spokesman for the European Commission also confirmed to Reuters that "President Barroso did send a letter to PM Orban over the week to express in a formal way the Commission’s concerns on draft laws."

"The independence of central banks is a key element of financial stability, and should not be undermined. The European Commission asks, therefore, the Hungarian authorities not to adopt this draft law.", Mr Bailly said in an emailed response to Reuters questions.

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