The European Commission decided on Thursday to launch infringement proceedings against Hungary because, according to the body, it is violating certain provisions of EU legislation on freedom of mass media and audiovisual media services.
The Hungarian government was the only one to oppose the Media Freedom Act
The European Media Freedom Act and Audiovisual Media Services Directive entered into effect in August. As we wrote at the time, the legislation stipulates, among other things, that public media executives must be appointed through a transparent and impartial process. The law prescribes transparent and objective financing procedures and requires that the media's political independence be guaranteed through monitoring. It also stipulates that member state authorities may not interfere in editorial decisions. It prohibits forcing journalists and editors to reveal their sources, having their offices searched, or having surveillance software installed on their devices. The Hungarian government was the only one that voted against the legislation in 2024; everyone else was in favour of it.
In its July report on the rule of law, the European Commission also warned that the threats to media diversity have still not been resolved in Hungary.
Concerns with the public media and advertisements
Based on the statement released on Thursday, the body concluded that the Hungarian authorities are not complying with the provisions that would protect journalists and the media from interference. By doing so,
they are “restricting the economic activity and editorial freedom of the actors in question.”
According to the European Commission, Hungarian law does not provide adequate protection for journalists' sources and confidential communication, nor does it provide effective judicial protection when these rights are violated. The Hungarian state is also
“failing to comply with requirements relating to public service media, transparency of media ownership, assessment of media market concentrations, and the distribution of state advertising.”
It has also failed to comply with the requirements set out in the Audiovisual Media Services Directive concerning national media regulatory authorities. The European Commission is therefore sending a letter of formal notice to the Hungarian government, which has two months to respond to the letter and address the concerns. If the Commission does not receive a satisfactory response, it may decide to issue a reasoned opinion.
Procedure on price margin restrictions enters second phase
The infringement proceedings initiated by the European Commission in June concerning the price margin restrictions have now entered this second stage. One was initiated by the body in relation to food products and the other in relation to non-food products available in drugstores. According to the Commission's opinion, the measures
“endanger the jobs of predominantly Hungarian employees of the concerned retailers.”
The body further states that "Hungary limited the margin between purchase prices and sales prices of products to such a low level that it no longer allows businesses to cover their costs, forcing non-Hungarian retailers to sell their products at a loss." Furthermore, the Hungarian government alleges that the difference between the sourcing price and the sales price equals the profit of concerned undertakings, not taking into consideration that undertakings also have substantial additional costs, for instance for personnel, real estate and taxes.
In both of the above cases, the European Commission has sent reasoned opinions. The government now has two months to respond and take the necessary measures, otherwise the body may refer the matter to the EU Court of Justice.
Provisions governing certified translation sector also found to be problematic
In addition,
- new infringement proceedings have been launched because the Hungarian authorities "failed to prevent violations of the prohibition on intra-EU investor-State arbitration, as established by the case law of the Court of Justice" in relation to MOL
- The European Commission is calling on the Hungarian state to ensure compliance with EU rules on freedom to provide services and public procurement in the certified translation sector.
- Along with several other member states, the body has also called on the Hungarian legislative and administrative authorities to transpose EU rules promoting the spread of renewable energy into national law.
After two rounds of correspondence, a lawsuit, and a court ruling on the amount of the penalty, the infringement proceedings may conclude with a fine.
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