EU top court strikes down Hungarian NGO law

Brussels launched infringement proceedings against Hungary over the law in 2017.

Hungary’s law on foreign-funded nongovernmental organizations violates EU law, the Court of Justice of the European Union ruled Thursday.

The decision is the culmination of a legal battle that began in 2017, when Hungary’s parliament approved new rules requiring that organizations receiving over 7.2 million Hungarian forints (about €20,000) from outside Hungary to formally register as foreign-funded entities.

The law, formally known as an act “on the Transparency of Organizations Receiving Foreign Funds” but nicknamed “Lex NGO” by critics, requires organizations to place a label indicating they are foreign-funded on websites, press products and publications. Groups failing to comply could be shut down.

The law sparked protests in Hungary, and the European Commission launched an infringement proceeding in July 2017, arguing that it interferes with fundamental rights, and in particular the right to freedom of association. The Hungarian government has rejected these concerns as unfounded.

The EU’s top court ruled that the law is discriminatory and imposes unjustified restrictions contrary to EU rules on free movement of capital, the right to respect for private and family life, personal data protection and freedom of association.

Minister Gergely Gulyás, Prime Minister Viktor Orbán’s chief of staff, told reporters on Thursday that the government will analyze the court decision.

The Hungarian Civil Liberties Union NGO welcomed the ruling. “We have promised to prove that the anti-NGO law is not only unjust but also unlawful,” Stefánia Kapronczay, its executive director, told POLITICO following the decision.

“We resisted through boycotting the law along with many Hungarian civil society organizations which resisted in various forms. We are delighted that the European Court of Justice ruled that the anti-NGO law indeed violates EU law,” she said, adding that “now it’s the turn of the Hungarian government to comply with the ruling and repeal the law.”

This story has been updated.