Budapest court requests annulment of savings coop act

Issues

The Budapest Municipal Court will request that the Constitutional Court annul the act on the integration of savings cooperatives after finding the act to be unconstitutional. The municipal court ruled that the act violates the right to ownership on several points, is contrary to fair economic competition and has intervened in the ownership structure of the majority privately owned Takarékbank.

The court held on Friday the second hearing in a lawsuit initiated by the National Association of Savings Cooperatives (OTSz) and a private individual against the Hungarian state, claiming compensation for damages caused through legislation. 

Judge Lajos Bene said the court will ask the Constitutional Court to annul the integration law and reinstate the conditions extant before the integration act, passed in July 2013, took effect.

The decision can be appealed within 15 days. The judge ordered the procedure to be suspended. The Constitutional Court will decide on the Municipal Court motion within 90 days.

Judge Bene said the court continues to disallow Magyar Posta from selling its Takarékbank shares under a contract signed earlier this year, extending this prohibition from a February ruling.

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