Megrendelés

Zoltán Varga[1]: The free movement of capital and the regulation of land transactions in Hungary (JURA, 2019/1., 527-542. o.)

The issue of usufructuary and usage rights before the Constitutional Court and the Court of Justice of the EU*

I. Usage and usufructuary rights related to agricultural land in Hungarian land law

1. Ownership of foreigners, Member State citizens and usage, usufructuary rights

Law-Decree No. 6 of 1974 regulated the acquisition of property by foreigners. It set out that foreigners could acquire real property in the People's Republic of Hungary, unless provided for otherwise by the law or an international treaty, by way of sale-and-purchase, exchange, or donation, under a preliminary approval. Acquisition of ownership is approved if the foreign person petitioning for the approval holds a settlement or repatriation permit, an international treaty ensures such persons the same treatment Hungarian citizens or Hungarian legal entities should get, or another important circumstance justifies the acquisition of real property. According to Decision No. 1025/1974. (V. 18.) of the Council of Ministers on the implementation of the Law-Decree, the Minister of Finance has the competence to issue such an approval and he or she must agree on this with the ministers concerned. The petition for such approval is to be submitted to the Minister of Finance, still before acquiring permits, releases, approvals, or official certificates required by other pieces of legislation. The Law-Decree was repealed by Section 71 of Act I of 1987 on Land, the Decision of the Council of Ministers was repealed by Decree No. 26/1987. (VII. 30.) of the Council of Ministers on the implementation of Act I of 1987.

Section 38 of Act I of 1987 on Land dealt with the ownership of foreigners. It provided for that foreign legal entities or individuals may acquire real property by way of sale-and-purchase, exchange, or donation with the preliminary approval of the Ministry of Finance, unless provided for otherwise by any legislation or international treaty. The Ministry of Finance is to issue the preliminary approval in agreement with the ministries (bodies with national competence) involved.

Act LV of 1994 on Agricultural Land (hereinafter referred to as Agricultural Land Act) prohibited that foreigners acquire agricultural land from its entry into force (27 July 1994). According to Paragraph (1) of Section 7 of the Agricultural Land Act, foreign individuals or legal entities may not acquire the ownership of agricultural land or protected natural areas. The acquisition of ownership of agricultural land outside protected natural areas was, however, permitted in the following cases: acquisition of agricultural land belonging to a farmstead as standalone real property with a maximum area of 6,000 m2; exchange of agricultural land owned at the time of entry into force of the Agricultural Land Act with another piece of agricultural land the area and a gold crown value not exceeding those of the original; agricultural land bought from the amount of compensation for the expropriation from agricultural land held at the time of entry into force of the Agricultural Land Act and the acquisition of ownership of agricultural land acquired through the termination of common property over such expropriated agricultural land. For usufructuary and usage rights, Paragraph (1) of Section 11 of the Agricultural Land Act ordered the appropriate application of the rules of Act IV of

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1959 on the Civil Code of Hungary (hereinafter referred to as Former Civil Code).

Paragraph (2) of Section 7 of the Agricultural Land Act was repealed by by Act CXVII of 2001 with the effective date of 1 January 2002; hence, foreigners could afterwards acquire the ownership of agricultural land belonging to a farmstead as standalone real property (part of agricultural land) with a maximum area of 6,000 m2 according to the provisions of separate legislation on other real property not qualifying as agricultural land (Section 8 of the Agricultural Land Act). Provisions concerning usufructuary and usage rights also changed at that time. Accordingly, the establishment of usufructuary rights and usage rights were subject to the provisions of Chapter II, limiting the acquisition of ownership. In doing so, pieces of land owned by and becoming subject to the usufruct (usage) of the acquiring party must be calculated together. This means that Hungarian regulations did not made it possible for foreigners to acquire the ownership, usage or usufructuary right of agricultural land.

Guiding Decision No. EBH 2005.1277. is related to the above modification as the facts of this case are that Hungarian individuals established usufructuary rights on agricultural land in the favour of German citizens, the plaintiffs. The usufructuary right of the plaintiffs was not recorded by the Cadastre Office. In the position of the court of first instance, registering the usufructuary right would have been possible, because the limitations specified in Chapter II of the Agricultural Land Act concerned the size and extent of the piece of land to be acquired. The Supreme Court was, however, on the opinion that "the agreement on the establishment of usufructuary rights, concluded by the plaintiffs, concerned a piece of agricultural land being under the prohibition of acquisition of ownership by foreigners, which is the highest degree of limitation.Paragraph (1) of Section 11 of the Agricultural Land Act specifically requires the appropriate application of the provisions of Chapter II limiting the acquisition of ownership for the establishment of usufructuary right and usufructuary right in an agreement or contract. Consequently, foreigners may not acquire the ownership of agricultural land or its usufructuary and usage right[1]".

The text of the Agricultural Land Act changed again when Hungary joined the European Union. More specifically, Paragraph (2) of Section 7 provides for that rules governing Hungarian individual shall apply to other Member State citizens who wish to settle down in Hungary as sole agricultural producers and have been residing continuously and lawfully in Hungary and pursuing agricultural activities for at least three years. Citizens of EU Member States must provide official certificates[2] proving that the conditions for their acquisition of ownership apply and they have to assume future obligations in a private document providing conclusive evidence or a notarised statement[3]. The county office of agriculture must issue its certificate based on an environmental scanning while it is to investigate the pursuit of agricultural activities. As for the certificate, the Curia found that "the status of sole proprietorship itself implies, without any other conditions, that the entrepreneur pursues business in his or her own name and at his or her own risk. It does not matter if the sole proprietor is in a business relationship with companies in which the individual as sole proprietor hold ownership interest."[4]. The county office of agriculture did, therefore, unnecessarily investigate the relationship of the sole proprietor as plaintiff with other business associations. The Curia pointed out that the "relevant statutory provisions of the Agricultural Land Act apply if the plaintiff, as sole proprietor, pursues agricultural (business) activities. The investigation whether a citizen of an EU Member State holds ownership interests in other business association(s) or his or her pursuit of agricultural activities in such business associations is, therefore, not part of the scope of the relevant statutory provisions"[5]. The facts of another case were that the plaintiff was the managing director of the LLC in his or her ownership between 1996 and 2007. In this lawsuit, the Supreme Court found that, although the LLC of the plaintiff pursued agricultural activities, "this was, however, not the activity of the plaintiff, he/she was the managing director only. He/she, therefore, was not a sole proprietor who pursued agricultural activities under the second Point of Paragraph (2)

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of Point 3 of Annex X to the Accession Treaty. Consequently, the authority, as defendant, acted in accordance with Point (c) of Paragraph (2) of Section 8/A of the Agricultural Land Act when it rejected the application for an official certificate"[6].

Paragraph (1) of Section 11 of the Agricultural Land Act was not modified at the time of accession to the European Union. This legislative provision was modified as from 1 January 2013 meaning that Section 7 of Act CCXIII of 2012 on the Amendment of Certain Acts regulating Agriculture enacted the rule that establishing usufructuary right by way of an agreement or contract is null and void except if the agreement or contract establishes the usufructuary right in favour of a close relative into the Agricultural Land Act. The above amending act enacted Paragraph (1) of Section 91 of the Agricultural Land Act as meaning that usufructuary rights established by way of an agreement or contract between non-close relatives, applying on 1 January 2033 for an indefinite period or for a definite period expiring after 30 December 2032 shall be terminated by operation of law. The reason for the amendment was to prevent the so-called "pocket contracts". According to the ministerial reasoning "practical experience shows that the intention to establish usufructuary rights by way of an agreement or contract often implies that the parties try to evade legal provisions"[7]. According to the ministerial reasoning "agricultural land is such an exceptional 'property' that the regulation of its disposal, use, and utilisation should be subject to a more limited dispositivity and freedom of contract"[8].

Paragraph (1) of Section 11 of the Agricultural Land Act was amended, as from 5 April 2013, as meaning that the establishment of usufructuary rights by way of an agreement or contract is null and void except if such agreements or contracts establish usufructuary rights in favour of a close relative. Establishment of usage right by way of an agreement or contract and the establishment of usufructuary rights by way of an agreement or contract between close relatives are subject to the provisions on the acquisition of ownership in Chapter II. In the meantime, Paragraph (1) of Section 91 was repealed by Point (o) of Paragraph (1) of Section 126 of Act CCXII of 2013 on certain measures and transitional regulations related to the Act CCXII of 2013 on the Agricultural and Forestry Land Trade (Interpreting Act for the Land Trade Act) as from 15 December 2013.

The Agricultural Land Act disappeared from the Hungarian legal system as from 1 May 2014, it was replaced by the already mentioned Interpreting Act for the Land Trade Act and Act CCXII of 2013 on the Agricultural and Forestry Land Trade (Land Trade Act).

Usufructuary and usage rights are regulated by Section 37 of the Agricultural Land Act, meaning that establishment of usufructuary rights or usage rights by way of an agreement or contract shall be null and void except if such an agreement or contract establishes such rights in favour of a close relative. The establishment of usufructuary rights by way of an agreement or contract between close relatives are subject to the provisions on the acquisition of ownership in Chapter II, in combination with the discrepancy in that Chapter. Usufructuary rights may be established for a maximum period of 20 years. Validity of an agreement or contract establishing usufructuary rights does not require the approval of the agricultural administration body. The land acquisition limits specified in the Act for farmers and non-farmers apply to usufructuary and usage rights as well.

Paragraph (1) of Section 108 was included among the transitional provisions of the Interpreting Act for the Land Trade Act as meaning that usufructuary rights and usage rights in force on 30 April 2014 and established by an agreement or contract between non-close relatives for an indefinite period or a definite period expiring after 30 April 2014 shall terminate by operation of law on 1 May 2014. In comparison to Paragraph (1) of Section 91 of the Agricultural Land Act, usufructuary and usage rights established by such contracts shall terminate on 1 May 2014 and not on 1 January 2033.

Paragraphs (1) and (3) of Section 94 of Act CXLI of 1997 on Real Estate Registration (hereinafter referred to as Real Estate Registration Act) stipulate that, with a view to erasing usufructuary rights and usage rights terminating based on Paragraph (1) of Section 108 of the Interpreting Act for the Land Trade Act

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from the land registry, individuals who hold usufructuary rights must, at the call sent by the real estate authority by 31 October 2014 at the latest, provide a statement on the close relationship between them and the real estate owner-whose ownership is certified by the instrument underlying the registration-having established the usufructuary right on the form issued by the minister within 15 days as from the delivery of the call. There are no grounds for application for certification due to the non-compliance with the deadline after 31 December 2014. If no close relationship exists according to the statement or the right holder fails to make the statement within the prescribed deadline, then the real estate authority shall ex officio erase the usufructuary right from the real estate register within six months following the deadline for the statement but until 31 July 2015 at the latest.

Different procedures were launched in connection with Section 108 of the Interpreting Act for the Land Trade Act; both the Constitutional Court and the Court of Justice of the EU examined this legislative provision (within the framework of infringement proceedings and a reference for preliminary ruling).

II. Procedure of the Constitutional Court

1. Initiations giving grounds for the procedure of the Constitutional Court

In their constitutional appeal, an individual and three business entities (through their legal representatives) and two other movers, moved for the establishment of the inconsistency with the Fundamental Law and the annulment of the provisions of Paragraphs (1)-(2) of Section 108 of the Interpreting Act for the Land Trade Act. The primary argument of the movers was that "in their position, the usufructuary right and the (land) usage right as segmental rights of ownership fall within the scope of constitutional protection of Article XIII of the Fundamental Law, whereas the mentioned rights existed based on long-term legal relationships and constituted assets. The movers regarded the ex lege termination of usufructuary and usage rights primarily as expropriation, secondarily as a limitation of ownership rights equal to the limitation of ownership. Bearing in mind the fact that, within the meaning of the objected statutory provisions, usufructuary rights terminated ex lege on 1 May 2014 and land use rights given by the usufructuary in a contract terminated ex lege on 1 September 2014, the movers were on the opinion that the deprivation of property-like rights of property value can be regarded as expropriation. The movers explained that the deprivation of rights affected a precisely specified scope of subjects (usufructuary and user) and they referred to the fact that the usufructuary rights and usage rights go to a person different from the previous owner, and this means a financial advantage to that person. On the part of the previous right holders (usufructuary and user), however, the deprivation of property-like rights of property value happened without a value guarantee, they did not receive any compensation for the deprivation of rights. In support of the alleged injury of their property, the movers also referred to the fact that the ex lege termination of rights of property value rendered the return on their already-implemented investments uncertain, and any later yields of cultivation (i.e. loss of profits) constitute damage to them"[9]. Secondly, the movers argued that the fundamental right to property was limited and they referred to the fact that a non-appealable court ruling supports that, in case of the real properties used by them, the title of use was not established based on a fictitious legal transaction. The movers also referred to the fact that "lease and usage relationships were established for a long term, and the legislator terminated these legal relationships without considering individual circumstances, providing only four to eight months for preparation. According to the movers, the preparation time was insufficient in the case examined, violating Paragraph (1) of Article B) of the Fundamental Law of Hungary (required preparation time)"[10]. They found it injurious that the legislator did not provide any compensation for the individuals and legal entities loosing their usufructuary and usage rights. In this connection, they referred to Paragraph (3) of Article I of the Fundamental Law of Hungary. In their position, the investments

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they made are such expenditures that they made having confidence in the continuation of the durable relationship; hence, the contested statutory provisions deprived them of their legitimate expectations. The movers also referred to the fact that the statutory provisions infringed the freedom of establishment and the fundamental principle of the free movement of capital in Articles 49 and 63 of the Treaty on the Functioning of the European Union. They also referred to Article 1 of Additional Protocol No. 1 of the European Convention for the Protection of Human Rights and Fundamental Freedoms of 4 November 1950 (hereinafter referred to as the Convention) and the relevant case-law of the European Court of Human Rights.

An individual and a business entity, as movers, elaborated the principles of property protection applied by the European Court of Human Rights in more detail. The movers pointed out that in its authoritative practice the European Court of Human Rights "recognises that the state's scope of powers to interfere with property is relatively broad; such measures must, however, be foreseeable and free of arbitrariness, and deprivation of property must be followed by compensation"[11]. According to the movers, the usufructuary right, as right of property value, is property and they referred to the fact that "all limitations of property must serve a 'legitimate goal', be lawful and proportionate to the goal to be achieved"[12]. The movers highlighted that "any intervention into the peaceful enjoyment of property-such as the deprivation of property-must create a 'fair balance' between public interest and the fundamental rights of the individual; there must be a link of reasonable proportionality between the applied means and the goal to be achieved, if it comes to the deprivation of property"[13]. Though the practice of the European Court of Human Rights provides states with broad discretion in limiting property rights, as regards means and ends; deprivation from property without a compensation reasonably proportional to the value of property implies the violation of the Convention. The movers stressed Decision No. 42/2006. (X. 5.) of the Constitutional Court.

In a subsequent constitutional review, the Commissioner of Fundamental Rights moved for the establishment of the inconsistency with the Fundamental Law of Paragraph (1) of Section 108 of the Interpreting Act for the Land Trade Act and the annulment of this provision, which he extended for Paragraphs (2)-(3) of Section 108. The Commissioner of Fundamental Rights reminded of the fact that the Constitutional Court examined the constitutionality of Paragraph (1) of Section 91 of the Agricultural Land Act, and that it did not found it inconsistent with the Fundamental Law, having regard to the termination applying for quite a long period of time. In this case, the requirements in the Interpreting Act for the Land Trade Act shortened the preparation time for six months. According to the Commissioner of Fundamental Rights, it is not a priori inconsistent with the Fundamental Law if certain previously acquired rights are to be adjusted to the new regulatory environment; in such cases, however, the legislator must set the transition into the new regulation in a way inconsistent with Paragraph (1) of Article B) of the Fundamental Law. The statutory provisions violate the requirement of the protection of trust, which is deductible from Paragraph (1) of Article B), because the legal entities applied, under the statutory provisions in force, dispositions with property-related effects or made decisions of existential gravity"[14]. Namely in the case at hand, the holder of the usufructuary right makes investments which typically have a log payoff period.

The Constitutional Court received four judicial initiatives for individual constitutional review from the Szombathely Administrative and Labour Court, in which the court requested the establishment of the inconsistency with the Fundamental Law of Paragraph (1) of Section 108 of the Interpreting Act for the Land Trade Act and Paragraph (5) of Section 94 of the Real Estate Registration Act and the annulment of these provisions. The judicial initiative is, in essence, identical to the content of the motions described in the foregoing. The court did not request the examination of inconsistency with an international treaty in conjunction with the Convention.

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2. Decision of the Constitutional Court

In the operative part of its Decision, the Constitutional Court established that inconsistency with the Fundamental Law applies due to the fact that the legislator did not create exceptional rules that though cannot be applied in the settlement of the accounts of the contracting parties but enable compensation for pecuniary injuries related to valid contracts in relation to the terminated usufructuary and usage rights based on Section 108 of the Interpreting Act for the Land Trade Act. The Constitutional Court called the legislator to eliminate the nonaction inconsistent with the Fundamental Law by 1 December 2015. In any event, it rejected the motions, initiatives and constitutional appeals.

The Constitutional Court started its argumentation stating that "the legal concept and content of property is usually not defined by the Fundamental Law but by other legal norms. The scope and content of rights protected by the Fundamental Law must be established based on the Fundamental Law. This controversy is a difficulty in the establishment of rights protected as property. The resolution of the controversy is that the fundamental right to property the Fundamental Law protects are specific rights existing at specific times and having a content specified by pieces of legislation: based on the fundamental right to property, legislation is usually obliged to respect rights that are components of the fundamental right to property in the sense of constitutionality"[15]. According to the Constitutional Court, Section 108 of the Interpreting Act for the Land Trade Act regulates three, relatively different sets of facts concerning the use of land: usufructuary, usage right established with a contract made between non-close relatives for a definite period; a contract (on the transfer of the right to use land) made for the period following the termination of the usufructuary, usage right; a contract concluded by the usufructuary on the transfer of usage right before 25 February 2014. The common feature is that all three sets of facts concerns rights based on contracts made between private individuals and do not contain an accrual of rights by the state. The sets of facts concern a relatively large number of contracts with various contents in case of which the involvement of parties may be different (depending on, for instance, how close the time specified in the Interpreting Act for the Land Trade Act is to the date of termination in the contract). A portion of usage rights is registered in the land registry, another portion is not.

"The assessment of the necessity to limit property rights must consider Article XIII of the Fundamental Law of Hungary, which only requires the existence of public interest, even for the complete deprivation of property, if it takes place in the cases and the way specified by the law. A more strict necessity is, therefore, not a constitutional requirement to limit the right to property, which is obviously a less severe intervention than expropriation. In the assessment of the existence of public interest, the Constitutional Court had to take into account that the limitation of property or the deprivation of property often favours other individuals directly (and is for the benefit of the public only through the solving of social issues), such as urban development, land reforms, tenant protection. The current case is a similar situation, discontinuation of the said usage rights is, on the one hand, a relief from burdens, while it imposes, on the other hand, obligations on the owner of agricultural land"[16].

On account of the right to property, the Constitutional Court referred to its Decisions No. 64/1993. (XII. 22.), 60/1994. (XII. 24.), and 3199/2012. (X. 31.), then it established that the ex lege termination of contract-based usufructuary, usage rights cannot be compared to expropriation, because both the previous Civil Code and the new Civil Code regulate the termination of usufructuary, usage contracts, moreover, they allowed for the alteration of the content of the contract by law. "Therefore, contrary to the limitation of civil law property right, which is implied by its absolute structure and possible only through expropriation, the scope of limiting rights based on obligations, including usufructuary rights and usage rights, by the law may be broader. In the latter case, enforceability of the interests of the parties is properly ensured by the rules of civil law"[17]. In addition, the Fundamental Law already enables a broader scope of limitation when it comes to agricultural land. In this context, the

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Constitutional Court referred to its Decision No. 17/2015. (VI. 5.).

On the account of the necessity and expediency of Section 108 of the Interpreting Act for the Land Trade Act, the Decision established that "in terms of the functioning of the strategic national objective implemented with the new system, regarding the ownership of agricultural land, the Interpreting Act for the Land Trade Act had to put an end to the legal consequences of the nearly two-decade long practice to acquire agricultural land which served as a basis for the dysfunctional application of usufructuary right. To function, the new system requires the requirement concerning the ownership, usufruct, and use that the land registry reflects the legal relationships corresponding to the Fundamental Law. Preventing the taking effect of the legal arrangements called "pocket contracts" in public discourse was, therefore, necessary, i.e. any further enforcement of rights, receivables, or claims based on legal relationships established to circumvent previous prohibitions and limitations to acquire property"[18]. The Constitutional Court found that Section 108 of the Interpreting Act for the Land Trade Act is not inconsistent with Article XIII of the Fundamental Law of Hungary.

The Constitutional Court established, however, that the Interpreting Act for the Land Trade Act does not provide for the compensation to be enforced in the settlement of accounts between the contracting parties for pecuniary losses caused by the termination of the legal relationships. Any amendment or dissolution of contract by law must consider the equitable interests of all parties, they must strive for a balance of interests, as legislative intervention implies responsibilities and may not cause injuries not justified by its goals. The Interpreting Act for the Land Trade Act does, however, not create a proper balance between the limitation in the interest of the public and the full functioning of the protected rights of the persons involved. "Property-like rights of property value were terminated against the will of the contracting parties, by operation of law. In settling the accounts between the contracting parties, holders of property-like rights of property value could lay settlement claims against the owner or the contracting party who transferred the mentioned rights to them under a contract, where the owner or the contracting party having transferred the right in question should not have taken such claims into account if the contracts had terminated in due order. The mentioned claims, enforceable by the holders of property-like rights of property value falling within the scope of settlement of accounts and existing against the owner or the contracting party having transferred the right under a valid contract and then terminated ex lege, could imply pecuniary losses to the owner or the contracting party having transferred the right which the statutory rules in the Interpreting Act for the Land Trade Act do not compensate properly and may also not be repaired either according to the previous or the new Civil Code. If, in the ex lege dissolved contracts having established usufructuary and/or usage rights, the parties agreed that the party acquiring the property-like right of property value acquired the said rights for a consideration paid in advance, then, having regard to the ex lege termination of the contracts still before the expiry of the contract term, the contracting party having paid the consideration may claim the repayment of a prorated portion of the consideration paid in advance, which raises concerns regarding the proportionality of limiting property in the interest of the public. The Constitutional Court sets the criteria of proportionality for the limitation of property in the interest of the public on its own; the requirement of proportionality could also be ensured if the limiting statutory rule ensure the opportunity to compensate, or at least mitigate, the pecuniary loss implied by the limitation of property in the interest of the public"[19].

On account of the required preparation time, the Constitutional Court established that the mover should have provide a detailed reasoning for why they do not regard the preparation time as adequate. In this context, the Constitutional Court referred to its Decision No. 6/2013. (III. 1.).

The Interpreting Act for the Land Trade Act does not have any provisions with retroactive effect as Section 108 terminated legal relationships established in the past as from a future point of time and it does not declare a behaviour illegal and it does not impose or make any

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obligation more burdensome for the period preceding its entry into force.

The Constitutional Court did not share the argument of the mover concerning the protection of trust, because the Constitutional Court was on the opinion that the parties could not have trusted that the existing legal situation would remain unchanged. "The regulation of usage relationships adheres to the moratorium for acquiring agricultural land, having ended on 1 May 2014, and its legal consequences were clear. A prudent and considerate economic operator could not have expected that the previous rules would remain relatively unchanged"[20]. The Constitutional Court found that its Decision No. 142/2010. (VII. 14.), adopted within the scope of the previous Constitution, is not applicable because the acquisition of rights took place surely with the risk that the legislative setting would change.

3. Dissenting opinions on the decision of the Constitutional Court

In her dissenting opinion, Dr. Ágnes Czine, judge of the Constitutional Court, highlighted the social constraint associated with property, which, in the case of agricultural land, is constituted by the fact that "land is finite property (namely land, as a natural object, is limited and cannot be propagated or substituted), indispensable, renewable, especially sensitive to risks, and yields profits to a moderate extent only; therefore, land ownership implies a special social constraint"[21]. The above might justify the enforcement of public interest against property rights. According to the case-law of the Constitutional Court so far, however, it is the legislator that must prove limitation for public interest, which was not the case in case of Section 108 of the Interpreting Act for the Land Trade Act. Outlining the process of legislation, the judge of the Constitutional Court established that there were grounds to conclude that the usufructuary rights established by contract would terminate only after a longer period of time, on 1 January 2033. Comparatively, the Interpreting Act for the Land Trade Act did not provide any reason for the termination of the above rights in 5 months. According to the dissenting opinion, inconsistency with the Fundamental Law of Section 108 of the Interpreting Act for the Land Trade Act "should have been established in consideration of Article XIII of the Fundamental Law, because the contested provision rendered the exercising of rights of property value falling within the scope of protection of property unpredictable, constituting an disproportionate limitation of the right to property of those involved"[22]. The judge of the Constitutional Court was on the opinion that the settlement of accounts due to the termination of usufruct and usage could have been possible under the Civil Code, without ascertaining the inconsistency with the Fundamental Law caused by the nonaction established by the Constitutional Court. Referring to the case-law of the European Court of Human Rights relevant to Article 1 of Additional Protocol no. 1 of the European Convention for the Protection of Human Rights and Fundamental Freedoms of 4 November 1950 (hereinafter referred to as the Convention), she found that limitation for public interest is acceptable if the injury caused is proportionate to the benefits for the public. The Court established the violation of the above Article even when action against the state in case of limitation of property was not possible because no procedural rules ensuring appropriate and equal protection of the law had been elaborated. According to the judge of the Constitutional Court, the position of the majority ignored "the diversity and uniqueness of the legal relationships affected by the regulations and the judicial practice enforcing this aspect. In this connection, courts proceeding in civil law cases did not regard the contract establishing the usufruct only because the original intention of the parties was to transfer property; having, however, regard to the fact that in the previously prevailing legal setting had not allowed them to conclude the contract, they established other rights, having force in rem, i.e. usufruct"[23]. The establishment of validity did namely require further components in the set of facts.

The dissenting opinion of Dr. Egon Dienes-Oehm, a judge of the Constitutional Court, is based on the fact that terminating usufructuary rights established between nonclose relatives by operation of law is not constitutionally objectionable. The statutory measure

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was, however, not applied in consistency with the Fundamental Law. He stressed that the legal presumption was not expressed and the explicit assurance of the option to challenge this presumption at a court did not take place. Now "assuming that usufruct established between non-close relatives is null and void in any case is obviously inconsistent with the Fundamental Law and does not meet the requirement of the right to a fair trial, and is, in terms of this latter aspect, a disproportionate limitation"[24].

According to the dissenting opinion of Dr. László Kiss, a judge of the Constitutional Court, Section 108 of the Interpreting Act for the Land Trade Act is inconsistent with the Fundamental Law; therefore, it should have been annulled. This judge of the Constitutional Court also referred to the stages of the legislative process and found that "reducing the 240-month transitional period to 4 months does not meet the requirement to ensure the required preparation time, amongst others because, not so long ago, would have required a 240-month, i.e. 20-year, transition period[25]". In his position, both the usufructuary and usage right should fall within the scope of protection provided by Article XIII of the Fundamental Law. In the conclusion of his dissenting opinion, he wrote that "only such model of property limitation may be accepted and only such model of deprivation of usufructuary and usage rights should have been regarded as consistent with the Fundamental Law which ensure that the constitutional interest requiring such radical solutions applies in a manner assessable in terms of individual usufructuary rights. Putting it in another way: I accept that the legislator may take away usufructuary rights; this should, however, take place in an appropriate procedure and for reasons specified in advance by the law and verifiable by the Constitutional Court in terms of constitutionality and under circumstances that the court can control"[26].

Dr. Tamás Sulyok, a judge of the Constitutional Court, also proposed the annulment of Section 108 of the Interpreting Act for the Land Trade Act due to the violation of constitutional requirement of legal certainty, derived from the provision of the rule of law in Paragraph (1) of Article B) of the Fundamental Law, and the protection of trust, which is a part of legal certainty. Having reviewed the previous relevant Decisions of the Constitutional Court, he found that Section 108 of the Interpreting Act for the Land Trade Act reduces the 20-year period of the previous regulations to less than 5 months, which "is obviously insufficient for the investments previously made to return or the preparation of businesses for the changed legal framework"[27]. According to the dissenting opinion, "issues of settlement, not regulated in any other pieces of legislation, regulating the settlement of accounts between the contracting parties based on the valid contracts establishing the ex lege terminated property-like rights of property value may not remain without regulation, the legal basis for enforcing disputed claims raised during the settlement of accounts at a court, and so their enforceability by a court, may not be unclear. Statutory rules serving as guarantee and ensuring the functioning of the protection of trust, derived from the provision of the rule of law of the Fundamental Law and the requirements of the Fundamental Law ensuring the predictable functioning of legal institutions may not remain without regulations"[28]. The risk the parties bear regarding the certainly changing legal framework does not imply bearing the consequences of legal regulations violating the trust in the relative permanence of the legal framework, a value of the rule of law.

III. Regulations concerning land transactions in Europe

1. Infringement proceedings and reference for preliminary ruling

At the indication of the Government of Austria, the European Commission initiated infringement proceedings against Hungary for the termination of usufructuary and usage rights without any financial compensation. In October 2014, the Commission sent a letter of formal notice, then, in June 2015, it sent a reasoned opinion to the Hungarian Government. Subsequently, the Commission filed a lawsuit against the Hungarian Government with the Court of Justice of the European Union.

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In parallel, a reference for preliminary ruling at the Court of Justice of the EU is also in progress; it was initiated by the Szombathely Administrative and Labour Court in two cases.

According to one set of the facts of a case underlying the reference for preliminary ruling, the lifetime usufruct of an Austrian individual was erased based on Paragraph (1) of Section 108 of the Interpreting Act for the Land Trade Act. The judge of the Szombathely Administrative and Labour Court (who is also the author of this paper) submitted the following questions to the Court of Justice of the EU. Does the legislation of a Member State which, similarly to that of the main proceedings, requires, for the continuation of an usufructuary right and/or usage right established on agricultural land, a verification of the close relationship with the person having established such usufructuary right and/or usage right, and, if the holder of the usufructuary right and/or usage right cannot verify the existence of such close relationship, then terminates the usufructuary right and/or usage right by operation of law without any pecuniary compensation constitute a limitation inconsistent with Articles 49 and 63 of the Treaty on the Functioning of the European Union? Does the legislation of a Member State which, similarly to that of the main proceedings, requires, for the continuation of an usufructuary right and/or usage right established on agricultural land, a verification of the close relationship with the person having established such usufructuary right and/or usage right, and, if the holder of the usufructuary right and/or usage right cannot verify the existence of such close relationship, then terminates the usufructuary right and/or usage right by operation of law without any pecuniary compensation affect, based on Articles 49 and 63 of the Treaty on the Functioning of the European Union, the citizens of the Member State concerned and the citizens of other Member States equally? In its order, the Court of Justice reviewed the Hungarian regulations concerning land transactions, then it referred to the ruling the Court of Justice of the European Union adopted in Case No. C-370/05. (Uwe Kay Festersen), Point 22 of which allows for the conclusion that it implies the movement of capital in the course of the exercising of the right to acquire, utilise, and alienate real estate located in other Member States, being a necessary complementarily of the right of establishment. The movement of capital means the operations persons who are not resident in a Member State apply to make real estate investments, as resulting from the nomenclature of capital movements in Annex I of Council Directive 88/361/EEC of 24 June 1988 for the implementation of Article 67 of the Treaty establishing the European Economic Community (hereinafter referred to as TEEC) [rescinded by the Treaty of Amsterdam] (hereinafter referred to as the Directive), which nomenclature remained to be authoritative for the definition of the movement of capital. Point A in Part II "Investments in real estate" of Annex I of the Directive classifies investments in real estate on national territory by non-residents as capital movements. Real estate investments under Subpoint F "Miscellaneous" of Point XIII of Annex I of the Directive include the followings: purchase of buildings or land, construction of buildings by individuals for the purposes of profits or personal use. This category includes usufructuary, easement, and building rights. According to the Grounds of the Ruling adopted in the Festersen case, Article 56(1) EC, as restrictions on the movement of capital, include those which are likely to discourage nonresidents from making investments in a Member State or to discourage that Member State's residents to do so in other States. If the legislation does not result in discrimination between the citizens of the Member State in question and the citizens of the other Member States of the European Union or the European Economic Area, this will not change the fact that the requirement to be a resident limits the free movement of capital. Such a measure may nevertheless be permitted provided that it pursues an objective in the public interest, that it is applied in a nondiscriminatory way and that it respects the principle of proportionality, that is to say that it is appropriate for ensuring that the aim pursued is achieved and does not go beyond what is necessary for that purpose (Points 25 and 26 of the Ruling adopted in the Festersen case). In the Festersen case, the Court of Justice of the European Union came to the conclusion that a legislation like that of the base case and

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which requires that, for the acquisition of agricultural land, the acquiring party creates a permanent place of domicile on that land is inconsistent with Article 56 of the TEEC.

In its order, the European Court of Justice first established that the Hungarian regulations do not constitute any open discrimination, then it examined whether hidden discrimination applies. The position of the Court of Justice is that citizens of the Member State in question can meet the requirement of verification of the existence of a close relationship as citizenship of the Member State in question allows for the easier verification of the existence of a close relationship regarding a contract establishing usufructuary right or usage right with the citizen of the Member State in question. For a non-Hungarian citizen of a Member State of the European Union, however, it is considerably more difficult to verify the existence of a close relationship with a Hungarian citizen establishing the lifetime usufruct or usage right with a contract, it is actually impossible in most of the cases. Consequently, the number of Hungarian citizens with usufructuary and/or usage right who can verify the existence of a close relationship with the owners of agricultural lands in Hungary is, naturally, higher than the number of non-Hungarian citizens of other Member States of the European Union. The rate of close family relationships among persons who are citizens of the same Member State is much higher than among persons who are citizens of different Member States. Referring back to the history of land regulations in the Member State, statutory provisions between 1994 and 2001 did not allow acquisition of ownership only the acquisition of usufructuary and/or usage rights for foreign individuals and legal entities. Consequently, non-Hungarian citizens of Member States of the European Union who wanted to farm agricultural land in Hungary in that period could not do this by way of acquisition of ownership, as Hungarian citizens could do, but by alternative ways like the acquisition of usufructuary and/or usage rights. This meant that the rate of non-Hungarian citizens of Member States of the European Union was significantly higher among holders of usufructuary and/or usage rights than that of Hungarian citizens. Referring to the ruling adopted in the Festersen case, the position of the Court of Justice of the European Union is that the contested legislation of the Member State requires, though in a concealed manner, Hungarian citizenship for the continuation of usufructuary and/or usage rights, which is a more hardcore restriction for non-Hungarian citizens of Member States of the European Union than requiring them to be residents. Previous Hungarian regulations laid down that foreign individuals and legal entities may not establish usufructuary right on agricultural land. This also shows that the Hungarian state discriminated between non-Hungarian citizens of Member States of the European Union and Hungarian citizens based on their citizenship until 1 January 2013. This regulation was in essence replaced by the contested legislative provision which, according to the position of the Court of Justice of the European Union, still discriminates non-Hungarian citizens of Member States of the European Union; this discrimination is, however, concealed, hidden in the contested legislation of the Member State. Having regard to the foregoing, the position of the Court of Justice of the European Union is that the legislation of the Member State applies to Hungarian citizens and the citizens of other Member States of the European Union without discrimination; it, however, puts citizens of other Member States of the European Union in a more disadvantageous situation (Keck formula). This makes the contested legislation of the Member State capable of effectively hampering the freedom of establishment and capital and payment transactions (Dassonville formula). The contested legislation of the Member State, in terms of its actual effect, discriminates non-Hungarian citizens of Member States of the European Union based on their citizenship and is capable of limiting the freedoms of establishment and capital and payment transactions, having regard to the deprivation of usufructuary and/or usage rights without pecuniary compensation. The Court of Justice then reviewed the effect of the contested legislation of the Member State on the capital transactions and investments of non-Hungarian citizens of Member States of the European Union. If a non-Hungarian citizen of a Member State

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of the European Union does not have a close relative in Hungary, then, as a result of the contested legislation of the Member State, he or she will loose the opportunity to realise his or her profits, revenues, and income expected from his or her exercising of his or her lifetime usufruct or usage right and the opportunity to realise returns on his or her previous investments. The contested legislation of the Member State makes it possible that a non-Hungarian citizen of a Member State of the European Union completely loses the opportunity to realise his or her investments made in relation to agricultural land, and it is not guaranteed that he or she will have the chance to recover the funds he or she invested in the Member State concerned in the future. As for the effect of the contested regulation on Hungarian citizens, it can be established that, if a Hungarian citizen does not verify the existence of a close family relationship regarding the usufructuary right and/or usage right of an agricultural land, he or she has a real chance to verify such a relationship for another piece of agricultural land and he or she also has the real chance to recover his or her investments that still have not returned in the Member State in question, by way of exercising property rights, usufructuary rights, or usage rights, or other investments. The Court of Justice then examined the necessity of the restriction, the overriding public interest. By adopting the Agricultural Land Act and the Interpreting Act for the Land Trade Act, the legislator assumed that usufructuary rights, usage rights established on agricultural land by and between non-close relatives is an investment for profit and does not accomplish the goals laid down in the recitals of the Agricultural Land Act. The legislator did not provide a detailed explanation for this assumption. The position of the Court of Justice is that the existence of a close family relationship does not automatically mean the exclusion of the motive to make investments for profit, because an usufructuary, who is a close family member, may also let another person use agricultural land for investment purposes. According to the Court of Justice, the contested regulations are unjustified, unnecessary even in terms of the discrimination between the citizens of the Member State in question based on the close family relationship, and this finding is especially true for non-Hungarian citizens of Member States of the European Union. As regards the proportionality of the restriction, the Court of Justice referred to the fact that the existence of a close family relationship itself does not guarantee the exclusion of investments for profit. The legislator should have chosen other criteria for the indirect restriction concerning non-Hungarian citizens of Member States of the European Union to accomplish its goals. Instead of the regulation assuming a concealed citizenship, it should have considered the habitation of the holder of the usufructuary right, usage right, the availability of personnel and material conditions to farm agricultural land, the fact that the agricultural land is actually cultivated, the extent of contribution to the income-generation ability of villages, the increase of employment, the development of local businesses, and the aspects of sustainable land use. Consequently, the legislator could have accomplished the goal it regarded as overriding public interest, the exclusion of for-profit investments, with other means as well. Through the contested regulation, however, the legislator terminated the usufructuary right, usage right related to agricultural land of all non-Hungarian citizens of Member States of the European Union, without any pecuniary compensation. The position of the Court of Justice is that the legislator took an invasive and unjustified measure in terms of enforcing the overriding public interest of excluding for-profit investments when it deprived non-Hungarian citizens of the Member States of the European Union of their usufructuary, usage rights concerning agricultural land based on the verification of the existence of a close family relationship. Doing so, the legislator violated the requirement of proportionality, crystallised in the case-law of the Court of Justice of the EU (ruling adopted in the Casati case No. 203/80, ruling adopted in the Konle case No. C-302/97.).)

According to the other set of facts, underlying the reference for preliminary ruling, the usufructuary right of a business association formed by the plaintiffs, citizens of a Member State of the European Union and established in Germany, was erased from the land regis-

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try. Another council of the Szombathely Administrative and Labour Court asked the following questions from the Court of Justice of the European Union. Are Articles 49 and 63 of the Treaty on the Functioning of the European Union and Articles 17 and 47 of the Charter of Fundamental Rights of the European Union to be so interpreted that a legislation of a Member State similar to that included in the main proceedings and providing for, without considering other aspects, the obligation to erase usufructuary and usage rights registered on agricultural real estate in favour of business entities and individuals who are not close relatives of the owner of such real estate without concurrently providing for the compensation of pecuniary losses of the holders of the erased usufructuary and usage rights, associated with valid contracts but not enforceable in the settlement of accounts between the contracting parties is inconsistent with them? Are Articles 49 and 63 of the Treaty on the Functioning of the European Union and Articles 17 and 47 of the Charter of Fundamental Rights of the European Union to be so interpreted that a legislation of a Member State providing for, without considering other aspects, the obligation to erase usufructuary and usage rights registered, based on contracts concluded before 30 April 2014, on agricultural real estate in favour of business entities and individuals who are not close relatives of the owner of such real estate and concurrently providing for the compensation of pecuniary losses of the holders of the erased usufructuary and usage rights, associated with valid contracts but not enforceable in the settlement of accounts between the contracting parties is inconsistent with them? This chamber of the Court of Justice also reviewed the history of land transaction regulations in Hungary and also referred to the ruling adopted in the Festersen case, but it explicitly referred to Article 52(1) of the Charter of Fundamental Rights and Article 1 of Additional Protocol No. 1 of the Convention and the relevant case-law of the European Court of Human Rights. The Court of Justice found that the national regulation examined in the proceedings can deter citizens of other Member States wishing to exercise the freedoms of capital movement and establishment from exercising their rights arising from these freedoms as they cannot trust that the Member State would not deprive them of their rights arising from their validly concluded contracts abortively, without proper compensation. The above allow for the conclusion that the national legislative provisions underlying the administrative decision being the subject-matter of the proceedings limit the free movement of capital and the exercising of the right of establishment as written above, and the right to property, ensured in Article 17 of the Charter of Fundamental Rights, and the right to a fair trial regulated in Article 47 of the Charter of Fundamental Rights, when, at the time of their adoption - consequently to Decision No. 25/2015. (VII. 21.) of the Constitutional Court - there was not any national legal regulation in force that would have provided for the proper compensation of the holders of the erased usufructuary right. Moreover, as the Court of Justice sees it, this injury takes place even if - while Section 108 of the Interpreting Act for the Land Trade Act and Paragraph (5) of Section 94 of the Real Estate Registration Act remain the same - the national regulation providing for appropriate compensation for the holders of the annulled usufructuary rights is adopted. Article 47 of the Charter of Fundamental Rights is infringed by the absence of an authority that would provide individual and meaningful assessment of the validity of contracts. The legislation of the Member State examined in the lawsuit does not enable individual and meaningful judicial examination. Regarding the general interest objective of the restriction, the Court of Justice refers to the relevant points of Decision No. 25/2015. (VII. 21.) of the Constitutional Court, which establish that the legislator did not provide sufficient support for the necessity of the regulation in Paragraph (1) of Section 108 of the Interpreting Act for the Land Trade Act and in Paragraph (5) of Section 94 of the Real Estate Registration Act, and the reasoning for the Interpreting Act for the Land Trade Act does not allow for the establishment of a legitimate objective associated with a restriction of general interest. The regulation contested with the pleadings and their reasoning do not contain any substantial reasoning for the differentiated annulment of usufructuary rights, there is no general inter-

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est that would be appropriately proven. The assumption, not enshrined in law, that all contracts establishing usufructuary and usage rights were concluded to circumvent the previous prohibitions and restrictions of acquisition of ownership does not provide appropriate justification for the allegation that the regulation would be of general interest and deprives those concerned of the opportunity to prove the lawfulness of their contracts in an official procedure; thus, it infringes the requirement of a fair trial regulated in Article 47 of the Charter of Fundamental Rights. The attempt of the Constitutional Court to find the general interest not appearing in the reasoning of the piece of legislation in question raises serious concerns. According to the Court of Justice, the Hungarian regulation limits the right to property, and the Court of Justice also refers to the dissenting opinions on Decision No. 25/2015. (VII. 21.) of the Constitutional Court, just as it did in case of the necessity of the restriction. The Court of Justice agrees with the dissenting opinions on the Decision of the Constitutional Court on account of the infringement of Article 47 of the Charter of Fundamental Rights, namely that the option to challenge the assumption before a court was not declared[29].

2. Motion of advocate general

In the reference for preliminary ruling, Advocate General Henrik Saugmandsgaard Oe delivered his opinion on 31 May 2017. The Advocate General first established that the Court of Justice of the European Union had jurisdiction to interpret EU law having regard to the fact that, though the usufructuary and usage rights were established before the accession of Hungary to the European Union, usufructuary and usage rights were erased after the accession to the European Union. The opinion also lays down that, on account of questions referred by a national court, the interpretation, or the determination of validity, of a rule of EU law bears relation to the actual facts of the main action, where the problem is not hypothetical, or where the Court has before it the factual or legal material necessary to give a useful answer to the questions submitted to it. National courts have the broadest scope of options to apply to the Court of Justice, they are not limited to do so by any mandatory provision of a Decision of the Constitutional Court relevant to them.

Subsequently, the opinion of the Advocate General lays down that national measures concerning real estate investments fall within the scope of the free movement of capital and not the freedom of establishment.

The position of Advocate General Oe is that the national measures at issue in the main proceedings entail a direct restriction of the free movement of capital. Paragraph (1) of Section 108 of the Interpreting Act for the Land Trade Act "establishes covert discrimination by reference to the source of the capital, insofar as the likelihood of being a close member of the family of a person who has granted such a right in Hungarian land will be greater in the case of a Hungarian national than in the case of a national of another Member State"[30]. Hungarian citizens can, therefore, meet this requirement easier than the citizens of other Member States. The Advocate General referred to the Hungarian legal regulation limiting the acquirement of land ownership, and established that such limitations "increase the likelihood that the current owners of agricultural land in Hungary will be of Hungarian nationality. The likelihood of being a close member of the family of a Hungarian landowner is greater in the case of a Hungarian national than in the case of a national of another Member State. Therefore, those restrictions, taken into conjunction with the requirement of being a close family member, operate to the disadvantage of the nationals of the other Member States"[31]. Those restrictions encouraged nationals of other Member States who wished to invest in agricultural land in Hungary to acquire usufructuary rights or rights of use in such land. Consequently, the extinction of those rights is "likely to affect a proportionally greater number of nationals of other Member States than of Hungarian nationals[32]". The claim of the Hungarian Government that, out of more than 100,000 persons affected by the cancellation of the usufructuary rights and rights of use, the number of foreign nationals is only 5,058 is, in the opinion of the Advocate General, not relevant in terms of the assessment of discrimination based on origin. The thing that should be examined is the rate

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of those concerned among Hungarian citizens and the citizens of other Member States. The number of those concerned is higher among the citizens of other Member States than among Hungarian citizens. According to the Advocate General, pecuniary compensation does not end the indirect discrimination. The measures at issue provide for "the extinction of usufructuary rights and rights of use created by private persons, and do so against their will. There may be numerous reasons why private contracting parties do not wish such rights to be extinguished, such as the right-holder's intention to retain the enjoyment of the land for reasons specific to him, the prospect of future income for both parties or the fact that the landowner will be unable to pay financial compensation if the rights are extinguished. In other words, the extinction of such rights is likely to entail, for the private contracting parties who established them, inconveniences which the prospect of a possible financial settlement cannot entirely remove"[33]. It follows from the foregoing, according to the Advocate General, that "the national measures at issue in the main proceedings, which provide for the extinction by operation of law of usufructuary rights and rights of use unless proof is adduced that the contract establishing such a right was concluded between close members of the same family, entail a discriminatory restriction of the free movement of capital guaranteed by Article 63 TFEU"[34].

The Advocate General disagrees with the three reasons the Hungarian Government provided to justify the regulation. As regards the infringements of the national legislation on exchange control, the Advocate General stressed that the national measure national measures at issue are disproportionate by reference to the objective. Regarding the prevention of abusive practices, the opinion referred to the fact that the national legislation is not capable of accomplishing the objective, because it cannot be excluded that "an abusive practice, consisting in circumventing the prohibition of the sale of agricultural land to foreign nationals, may have been devised between close members of the same family"[35]. Regarding the prevention of property speculation, the Advocate General expounded that the national measures do not allow for the preclusion of the fact that close family relatives of the owner get usufructuary and usage rights for the purpose of property speculation. The contrary is also true, namely that non-close relatives can also acquire such rights for the purposes of agricultural production. The Hungarian measures are not necessary at all, the Government could have accomplished this objective by respecting the fundamental freedom. This would have been possible by requiring that holders of usufructuary, usage rights must farm the relevant agricultural land.

According to the Advocate General, violation of Articles 17 and 47 of the Charter of Fundamental Rights may not be examined independently from the violation of fundamental freedoms.

In conclusion, the Advocate General requests that the following answers are to be given for the courts having submitted the question. "Article 63 TFEU must be interpreted as precluding national legislation such as that at issue in the main proceedings, which prescribes that usufructuary rights and rights of use in arable land are to be extinguished unless proof is adduced that those rights were created between close members of the same family, notwithstanding the possibility that the holder of those rights will obtain financial compensation from the other party to the contract. Article 51(1) and (2) of the Charter of Fundamental Rights of the European Union must be interpreted as meaning that, when the Court of Justice examines national legislation by reference to the freedoms of movement, the alleged breach of a fundamental right guaranteed by the Charter cannot be examined independently of the question of the breach of those freedoms"[36].

The Court of Justice of the European Union did not adopt a ruling in the reference for preliminary ruling before the closing of this paper (22 December 2017). The ruling will have great significance not only in terms of the conclusion of the infringement procedure but also for the survival or ultimate loss of the investments of non-Hungarian citizens. ■

NOTES

* This paper has been made within the framework of the programmes initiated by the Hungarian Ministry of Justice to raise the standard of legal education.

[1] Guiding Decision No. EBH 2005.1277.

[2] Official certificate issued by the alien control office certify-

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ing that the person in question has been continuously and lawfully residing in Hungary for at least three years; valid residence permit of citizens not holding a domiciliation permit, or a proof of having submitted the application for it; certificate of the county office of agriculture certifying that the person in question has been continuously pursuing agricultural activities in his or her own name and at his or her own risk in Hungary in the preceding three years (Paragraph (2) of Section 8/A of the Agricultural Land Act).

[3] The citizen of the EU Member State is to provide a statement that he or she is to settle down in Hungary as sole agricultural producer; he or she is to assume the obligation that he or she will not use agricultural land for purposes other than building residential and commercial buildings necessary for agricultural production and that he or she will let others use the agricultural land to an extent that the so-generating revenues do not exceed 25% of his or her revenues from agricultural activities.

[4] Case-decision No. KGD 2014.13.

[5] Case-decision No. KGD 2014.13.

[6] Case-decision No. BH 2009.223.

[7] Ministerial reasoning for Sections 6-18 of Act CCXIII of 2012

[8] Ministerial reasoning for Sections 6-18 of Act CCXIII of 2012

[9] Margin No. 4 of the reasoning of Decision No. 25/2015. (VII. 21.) of the Constitutional Court

[10] Margin No. 6 of the reasoning of Decision No. 25/2015. (VII. 21.) of the Constitutional Court

[11] Margin No. 11 of the reasoning of Decision No. 25/2015. (VII. 21.) of the Constitutional Court

[12] Margin No. 11 of the reasoning of Decision No. 25/2015. (VII. 21.) of the Constitutional Court

[13] Margin No. 11 of the reasoning of Decision No. 25/2015. (VII. 21.) of the Constitutional Court

[14] Margin No. 16 of the reasoning of Decision No. 25/2015. (VII. 21.) of the Constitutional Court

[15] Margin No. 55 of the reasoning of Decision No. 25/2015. (VII. 21.) of the Constitutional Court

[16] Margin No. 57 of the reasoning of Decision No. 25/2015. (VII. 21.) of the Constitutional Court

[17] Margin No. 61 of the reasoning of Decision No. 25/2015. (VII. 21.) of the Constitutional Court

[18] Margin No. 63 of the reasoning of Decision No. 25/2015. (VII. 21.) of the Constitutional Court

[19] Margin No. 63 of the reasoning of Decision No. 25/2015. (VII. 21.) of the Constitutional Court

[20] Margin No. 71 of the reasoning of Decision No. 25/2015. (VII. 21.) of the Constitutional Court

[21] Dissenting opinion regarding Decision No. 25/2015. (VII. 21.) of the Constitutional Court

[22] Dissenting opinion regarding Decision No. 25/2015. (VII. 21.) of the Constitutional Court

[23] Dissenting opinion regarding Decision No. 25/2015. (VII. 21.) of the Constitutional Court

[24] Dissenting opinion regarding Decision No. 25/2015. (VII. 21.) of the Constitutional Court

[25] Dissenting opinion regarding Decision No. 25/2015. (VII. 21.) of the Constitutional Court

[26] Dissenting opinion regarding Decision No. 25/2015. (VII. 21.) of the Constitutional Court

[27] Dissenting opinion regarding Decision No. 25/2015. (VII. 21.) of the Constitutional Court

[28] Dissenting opinion regarding Decision No. 25/2015. (VII. 21.) of the Constitutional Court

[29] See also the dissenting opinion of dr. Egon Dienes-Oehm, judge of the Constitutional Court

[30] Point 73 of the Motion of Advocate General Henrik Saugmandsgaard Oe

[31] Point 76 of the Motion of Advocate General Henrik Saugmandsgaard Oe

[32] Point 77 of the Motion of Advocate General Henrik Saugmandsgaard Oe

[33] Point 85 of the Motion of Advocate General Henrik Saugmandsgaard Oe

[34] Point 87 of the Motion of Advocate General Henrik Saugmandsgaard Oe

[35] Point 103 of the Motion of Advocate General Henrik Saugmandsgaard Oe

[36] Point 143 of the Motion of Advocate General Henrik Saugmandsgaard Oe

Lábjegyzetek:

[1] The author is doctoral School of the Faculty of Law at the University of Pécs administrative and labour judge at the Szombathely Administrative and Labour Court.

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