After the entry into force of the Fundamental Law of Hungary, the Constitutional Court perceptibly changed its attitude towards ownership and the limits of state intervention. Even the former President of the Constitutional Court, Barnabás Lenkovics, said several times that the Constitutional Court itself had to change the way it perceives its role, and it had to reconsider its previous practice due to economic necessities[1]. In several respects, the latter also appears in the regulations in force (such as the limitation of the Constitutional Court's investigation of "Acts of Parliament regulating finances"[2]) but is also reflected in many major decisions of the Constitutional Court.
Having regard to the complexity of the topic and not wanting to make this paper way too long, the purpose of this paper is to provide a comprehensive and concise picture of the integration of savings cooperatives, certain concerns of constitutionality that arose in this context[3], and the change in the position of the Constitutional Court[4], providing more space to the state to intervene in the business sector, through Act CXXXV of 2013 on the integration of cooperative credit institutions and amendments to economy-related legal regulations[5] - in the light of the Fundamental Law of Hungary.
Before the adoption of the Act, the legislator explored the relevant issues of savings cooperatives and their network and described the situation (as I did in the followings); this description is included in the general reasoning to Bill No. T/11651. on the integration of cooperative credit institutions and amendments to economy-related legal regulations. I describe the same situation based on the decision of the Constitutional Court.
In 2013, the legislator was on the opinion that the Hungarian system, network of savings cooperatives did not provide appropriate protection to the depositors and owners. Management and operation of the system of savings cooperatives was way too fragmented, inefficient; still, it posed several risks to the investors, partners; before the Act entered into force, savings cooperatives did not have uniform rules of operation, risk management, collateral appraisal, prudency etc. and did not require member organisations to operate uniformly.
The state entered into preliminary consultations with the savings cooperatives and set the objective to stabilise and make them efficient, on the condition that it will spend public money on the integration if operations will be within the limits of the new Institutional Protection Fund, which will be raised by the savings cooperatives by transferring the assets of the current institutional protection funds into it.
The Bill also argued that the integration of institutional protection funds providing prudential regulations, institutional protection and solvency margin would mean significant benefits for the entire system in terms of efficiency, prudence and guarantee. The legislator was on the opinion that the establishment of the new organisation would be a practical step because it would be the simplest way to
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consolidate the already existing institutional protection funds. The opinion of the state was that the selected organisational structure would allow for an especially quick decision-making.
Having regard to the foregoing, the Hungarian State integrated the savings cooperatives by way of legislation with a view to market challenges and the efficient operation of savings cooperatives. This law-based integration had two central bodies. One of them was the Takarékbank [in English: Savings Bank], which was already functioning as a central bank at the time, the other one was the Integration Organisation providing prudential rules, institutional protection and solvency margin.
The newly established integration organisation is a common institutional protection organisation (it integrates previous institutional protection funds), issues certain prudential rules, provides solvency margin to integration members and may investigate whether the savings cooperatives are appropriately capitalised. If the requirement of minimum capitalisation is not met, then it can temporarily increase the capital to stabilise operations.
Cooperative credit institutions that had already had a business license at the time the Act entered into force became members of the new integration by operation of the Act and were obliged to become shareholders of Takarékbank (if they have not been so far).
The Government started to prepare the transformation of savings cooperatives already in December 2012, basically in order to establish a well-capitalised and securely operating sec-tor.[6]
Subsequently, the Government Commissioner responsible for the integration reform invited the heads of the savings cooperatives for a consultation meeting on 24 June 2013, Monday, 9:00 a.m. (in an email sent on 21 June 2013, Friday, around 7:00 p.m.) in order to discuss "experiences related to the cooperative sector and the lessons learned from such experiences" with them. The Government discussed the concept outlined at this consultation meeting on the same day, and the specific bill was submitted to the Parliament on the next day[7].
After the proposal was immediately discussed and adopted by the Government, the Prime Minister requested the Speaker of the Hungarian Parliament in his motion of 24 June 2013[8] that the bill be discussed in an exceptionally urgent procedure, in a manner that the time frame for submitting amendment proposals be three hours from the time of ruling on 26 June 2013; the vote on proposed amendments and the final vote be on 27 June 2013; all this was based on Paragraph (1) of Section 128/A. of Decree No. 46/1994. (IX. 30.) of the Parliament of Hungary on certain provisions of its rules of procedure, and Point (a) of Paragraph (3) of the same Section.
The Parliament of Hungary adopted Act CXXXV of 2013 in an exceptionally urgent procedure on 27 June 2013; then, the President of the Republic, exercising his constitutional rights, sent it back to the Parliament for reconsideration. Then the legislator adopted the bill in a vote on 5 July 2013; the President of the Republic signed it; then, after it was promulgated, it entered into force on 12 July 2013, except for certain regulations.
The Act amended the credit institutions act and other relevant laws, it established the integration organisation and provided rules on its operation.
In 2013, the integration of cooperative credit institutions meant the cooperation of 121 independent, privately owned cooperative credit institutions (savings cooperatives, credit cooperatives, small banks).
In the following, I provide a review of the most important changes in comparison with the regulations before the entry into force of the Act.
With the entry into force of the Act, the legislator integrated cooperative credit institutions under the umbrella of a new institutional protection organisation based on the principle of mandatory membership, and, concurrently, overturned the Integration Agreement[9] and wound up institutional protection funds as well. All this meant that the legislator set
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the integration of cooperative credit institutions on a completely new institutional basis.
This means that the integration is based on mandatory membership. Cooperative credit institutions having an operating license at the entry into force of the Act were made members of the Integration Organisation by operation of the Act. Future cooperative credit institutions are obliged to join the integration, become shareholders in Takarékbank Zrt. and members of the integration organisation; the same was implemented for cooperative credit institutions already having a business license by operation of the Act.
The Integration Organisation of Cooperative Credit Institutions (in Hungarian Szövetkezeti Hitelintézetek Integrációs Szervezete, hereinafter: SZHISZ) was established on the date the Act entered into force; it is a legal entity, an institutional protection organisation based on the principle of involuntary association. It must be stressed that this sector did previously not have an organisation like the SZHISZ; however, advocacy organisations and the related institutional protection funds had a similar function (e.g. OTSZ-OTIVA organisation). Cooperative credit institutions, Takarékbank Zrt. and the MFB[10] all became members of the SZHISZ ex lege.
Provisions of the Act allow for the conclusion that the legislator conferred strong control rights upon the SZHISZ over its members (except for the MFB). The start-up capital of the organisation came from two sources: the wound-up institutional protection funds (OTIVA, REPIVA, HBA, TAKIVA) and the financial contribution of MFB, which the Act specifies as a one-off contribution amounting to HUF 1 billion and the amount[11] specified in Paragraph (1) of Section 20 of the Act.
The Takarékbank became the central bank of the integration of cooperative credit institutions, thus one of the drivers of the entire integration process. (Paragraph (2) of Section 1, Paragraph (1) of Section 15 of the Act)
One of the greatest innovations of the Act is the transformation of the ownership structure[12] of Takarékbank and its relationship towards the credit institutions involved in the integration, the strengthening and widening of its controls. Before the Act entered into force, the ownership structure was the following: cooperative credit institutions: 60.42%, MFB: 39.28%, OTSZ: 0.29%, other shareholders: 0.01%. Takarékbank used to have two types of shares: common shares and 235 pcs. of "B" series preferred voting shares. The so-called "C" series preferred shares (160 pcs, total value: HUF 320,000) were created concurrently with the entry into force of the Act.
It created a risk community involving the entire cooperative credit institution sector and based on joint and several liability; however, not in the form it is used in private law, but with its revised form.
After the Act entered into force, the National Association of Savings Cooperatives submitted a constitutional appeal against many of its provisions for the investigation of its consistency with the Fundamental Law and the annulment of the provisions that are in conflict with the Fundamental Law. After that, 135 complaints were submitted by individuals (cooperative members), 3 petitions were submitted by cooperative credit institutions and 1 joint motion was submitted by banks that operate as joint-stock companies.
In addition to the above motions, the Constitutional Court later received a judicial motion based on which it adopted its Decision No. 3192/2014. (VII. 15.) AB on 07.07.2014, which I will not deal with in detail in this paper, but only to the extent the completeness of the topic so requires.
Decision No. 3192/2014. (VII. 15.) AB concluded that the Constitutional Court has already investigated, based on constitutional appeals, the conformity of certain provisions of the Act with the Fundamental Law of Hungary in another case [in conclusion of which the Constitutional Court adopted Decision No. 20/2014. (VII. 3.) AB]; therefore, the case was considered as partly ruled (res iudicata)
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based on Paragraph (1) of Section 31 of Act CLI of 2011 on the Constitutional Court (hereinafter: Constitutional Court Act). Accordingly, the Constitutional Court closed the procedure with respect to the relevant elements of the motions.
According to the movers, the following provisions of the Fundamental Law were infringed:
- the right to engage in entrepreneurial activities, provided in Paragraph (1) of Article XII of the Fundamental Law of Hungary;
- the right to property, described in Paragraph (1) of Article XIII;
- the right to a fair trial, described in Paragraph (1) of Article XXIV and
- the right to legal remedy, guaranteed in Paragraph (7) of Article XXVIII,
- non-discrimination set out in Article XV.
- The movers found the fact that the relevant actors were not involved in the process of legislation and that the legislator did not provide the required preparation time to be problematic in terms of the requirement of the rule of law.
- They further argued that the limitation of rights imposed by the Act is not constitutionally justified, therefore it infringes Paragraph (3) of Article I of the Fundamental Law.
- The movers put forward that the Act can mean that cooperative credit institutions can lose their properties (shares) in Takarékbank. They argued that their losing of their majority ownership was the first step in the limitation of their property rights, while the second step was the mandatory selling of their property.
- The movers are on the opinion that the provisions of the Act are inconsistent with the Fundamental Law of Hungary and the law of the European Union as well. In particular, the provisions violated, rendered meaningless the right to property in Article XIII of the Fundamental Law, the exercising of the voting right attached to property and the free exercising of the right to representation in combination with ownership. In their opinion, the constitutional prerequisites to expropriation are not met. It is against the freedom of engaging in entrepreneurial activities, the principle of fair economic competition and the prohibition of discrimination that the bodies keeping the bank accounts of those shareholders of Takarékbank who are cooperative credit institutions (except for the Takarékbank itself) are obliged to terminate bank account agreements that are in force on 31 October 2013.
- They raised further objection against the fact that the Act does not provide legal remedies against the decisions and rulings of Takarékbank and the Integration Organisation, which violates Paragraph (7) of Article XXVIII of the Fundamental Law of Hungary.
- In the opinion of the movers, preparation and adoption of the Act violated the requirements of legislation.
- According to the movers, the provisions of Act CXXX of 2010 on Legislation (hereinafter: Legislation Act) were not adhered to. In this context, they found the non-application of the preparation time injurious, and they referred to the incompatibility with the legal system and nonperformance of the impact assessment and the opinion procedure. In the opinion of the movers, violation of the Legislation Act also implied the violation of Paragraph (2) of Article R) of the Fundamental Law of Hungary, because that requirement of the Fundamental Law provides that the laws are obligatory to everybody. One of the individual movers submitted a petition in which it was stated - differing from the other petitions - that the absence of the opinion procedure and the inconsistent regulatory content (in conjunction with several other provisions of the Act) and the infringed norm clarity implied the violation of Paragraph (1) of Article B) of the Fundamental Law of Hungary.
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In this paper I review only a few of these issues.
Based on the constitutional appeal(s) received, the Constitutional Court adopted the following decisions in Decision No. 20/2014. (VII. 3.) AB, in conclusion of the investigation of the Act.
1. The Constitutional Court established that several provisions of the Act were in conflict with the Fundamental Law; therefore, it annulled them.
The wording "illetve esetleges jogutódjaikon" [in English: or through any potential legal successor] in Paragraph (4) of Section 14 of the Act turned out to be in unconstitutional; after the annulment, it remained in force with the following wording: "A Takarékbank Zrt. részvényese - az MFB-n és a Magyar Postán kívül - nem gyakorolhatja a részvényesi jogait és esetleges elővásárlási vagy más részvényhez fűződő előjogait, amennyiben [...]" [in English: the shareholder of Takarékbank Zrt., except MFB and Magyar Posta, may not exercise its shareholder's rights and any potential pre-emption right or any right arising from its hares if [...]].
Furthermore the wordings "- az alábbi sorrendben -" [in English: in the following sequence] and "amennyiben a sorrendben megelőző helyen álló személyek a követelésért nem álltak helyt és fizetésképtelenségüket jogerős bírósági ítélet mondta ki" [in English: if persons having higher ranks in the sequence have not honoured the claim and they are declared insolvent by a non-appealable court ruling] in Paragraph (4) of Section 20/A of the Act. After the annulment, Paragraph (4) of Section 20/A of the Act remained in force with the following wording: "(4) Az 1. § (4) bekezdésében szereplő egyetemleges felelősség alapján az adóson kívül az Alaptól, a többi szövetkezeti hitelintézettől, az Integrációs Szervezettől illetve a Takarékbank Zrt.-től lehet az egész követelést követelni. Az adóson kívül az Alaptól akkor lehet követelni az adós fenti tartozását, ha az adós jogerős ítéletben megállapított vagy nem vitatott tartozását az esedékességtől számított további 30 napon belül sem teljesíti. Az egyetemlegesség alapján fizetendő összegért az Alap 60 napon belül köteles az adós helyett a fenti határidőt követően helytállni. Az egyetemlegesség alapján fizetendő összegért az Alapot követően a többi szövetkezeti hitelintézet, az Integrációs Szervezet, illetve a Takarékbank Zrt. áll helyt." [Based on the joint and several liability in Paragraph (4) of Section 1, the entire claim may be enforced against not only the debtor, but also the Fund, other cooperative credit institutions, the Integration Organisation and Takarékbank Zrt. The above debt of the debtor may be claimed from the Fund (in addition to claiming it from the debtor) if the debtor fails to settle its debt which is either non-disputed or established by a non-appealable ruling within 30 days from its due date. The Fund shall honour the claim payable according to the joint and several nature instead the debtor within 60 days after the lapse of the above deadline. After the Fund, the amount payable according to the joint and several nature shall be settled by the other cooperative credit institutions, the Integration Organisation and Takarékbank Zrt.]
2. The Constitutional Court also provided a requirement of constitutionality. It established that "in the application of Paragraph (3) of Section 19, Section 17/D, Paragraph (2) of Section 17/H and Point IX. 9.1, e) of Annex No. 1 of the Act, the constitutional requirement specifying - based on Paragraph (1) of Article XIII of the Fundamental Law - that model articles of association may only have such mandatory elements that are indispensable to the achievement of the goals of the Act, or serve the implementation of the Act, or are necessary for the meeting of European Union requirements concerning the integrated operation of credit institutions must apply".
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3. The Constitutional Court rejected other motions that were based on Paragraph (1) of Article B) of the Fundamental Law and aimed at the establishment of the inconsistency with the Fundamental Law and the annulment of the entire Act and others of its rules that were contested in addition to the foregoing ones; it terminated the procedure(s) launched in other aspects, and did in any other case refuse the motions.
This allows for the conclusion - and it must be stressed at the same time - that the Constitutional Court rejected most of the arguments of the motions in the subject of establishing the inconsistency of the Act with the Fundamental Law.
In the opinion of the movers, the legislator did not ensure the required preparation time[13] for the application of the law in question; thus, it violated the rule of law described in Paragraph (1) of Article B) of the Fundamental Law of Hungary, and of legal certainty, which is derived from the rule of law.[14]
By virtue of the authoritative practice of the Constitutional Court, it is a requirement under the rule of law that the date of entry into force of any law must be set in such a way that it ensures the required time for the preparation for the application of that law. For the specification of the date of entry into force of a law, the requirement of legal certainty obliges the legislator to ensure the time required for
- familiarising with the text of the law;
- the preparation for the application of the law by legal practitioners;
- the decision of the bodies and persons affected by the law how they wish to adapt to the provisions of the law. The Constitutional Court also pointed out that the investigation if the preparation time is appropriate and if it infringes the requirement of legal certainty, must take place in consideration of the changes in the content of the regulations. The Constitutional Court also stressed that unconstitutionality applies only in case of the absence of the period for preparing for the application of the law is ostentatious, has a material adverse effect to or infringes legal certainty (in summary, see: Paragraphs [233]-[238], [241] of the Reasoning to Decision No. 6/2013. (III. 1.) AB of the Constitutional Court).
The Act was adopted by the Hungarian Parliament at its session on 5 July 2013, and it was promulgated on 12 July 2013, its provisions (except for some of them) entered into force, pursuant to Section 21 of the Act, on the date following the promulgation, i.e. on 13 July 2013.
After revising the major milestones of the integration agenda[15] (determined by the Act), the Constitutional Court concluded that the extent and depth of the changes affecting the sector are obviously substantial. It is also without any doubt that the legislator gave effect to and ordered the application of the requirements of the Act basically without any preparation time, which is an unusual, extraordinary solution if one considers the requirement of ensuring the required preparation time, derived from legal certainty. The enacted provisions were, in fact, limitations; at the same time, however, the law had a precise agenda for both the implementation of the requirements in the Act and the fact when, how the legal entities concerned, including the movers, must actively adapt to the new legislative environment determining their activities. The position of the Constitutional Court is that primarily the latter thing is significant in terms of determining whether the entities concerned had time enough to adjust their behaviour to the requirements of the law.
In Paragraph [127] of the Reasoning to its Decision, the Constitutional Court said that the Act had only a few provisions that required active behaviour from cooperative credit institutions (and the banks concerned by the integration)[16]. It must nevertheless be stressed in this context that the Constitutional Court explained in its Reasoning referred to in the foregoing that these provisions were limiting in nature.
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I cannot accept the argumentation of the Constitutional Court, expounded regarding the required preparation time in the Reasoning described above, in which it refers to its authoritative practice[17] (correctly, in my opinion), outlines the elements determined as the elements constituting the requirement of legal certainty and required for ensuring the required preparation time. In my opinion, however, the majority decision of the Constitutional Court ignored (its own) finding that adequacy of the preparation time must be assessed with consideration of the substantive changes of the regulations, as it concluded that some of the provisions of the Act (which require active behaviour from the subjects of the Act) were limitations in nature. In my opinion, the argumentation of the Constitutional Court that the foregoing is rendered consistent with the Fundamental Law by the fact that the Act provides for an agenda with "precise deadlines", thus enabling the persons to whom the law applies to adjust their behaviour to the norm; however, it ignored the fact that the legislator gave effect to and ordered the application of the Act, basically without any preparation time, after the promulgation of the Act.
Therefore, I think that this argumentation of the Constitutional Court - focusing on the existence of the precise agenda specified in the Act when investigating this subject and accordingly establishing its conclusions for the required preparation time -is not correct. I agree with the dissenting opinion of Miklós Lévay, judge of the Constitutional Court, in which he provided a proposition corresponding to the requirement of legal certainty [364]: the transition period is indispensable for reforms [to support this argumentation, he referred to the reasoning of Decision No. 6/2013. (III. 1.) AB and Decision No. 51/2010. (IV. 28.) AB].
In its previous Decision No. 51/2010. (IV. 28.) AB, the Constitutional Court drew the conclusion in conjunction with laws inducing considerable changes that the preparation time can be very short if the preparation is technical only.
In my opinion, however, it cannot be called technical preparation when it comes to the active behaviour required by the Act, because they imply limitations (as the Constitutional Court also recognised), and, as I have already explained, this is not changed at all by the fact where the person(s) to whom the law applies act according to a precise agenda.
Investigating the content of the provisions of the Act, the Constitutional Court judged the required preparation time as follows: although the integration meant fundamental innovations for the specificities of the functioning of the sector, the integration agenda (secured with deadlines) described in the Act required the credit institutions involved in the integration to take only a few steps. The indicated periods are short; nevertheless (having regard to the especially "sensitive" financial sector), they are not outstandingly short, they do not have a material adverse effect on legal certainty and have not rendered adaption to legislative provisions impossible.
This fact and the particular sensitivity of the sector could have provided sufficient reason for the legislator to make the preparation process as short as possible.
As for the motion element according to which the legislator failed to consult the organisations involved in the integration, the Constitutional Court pointed out that "the preparation of a bill is not part of the legislative process; therefore, non-fulfilment of the legal obligation of consultation or organising a social debate entails the political liability of the legislator but does not result in the public law invalidity of the law in question" [Decision No. 165/2011. (XII. 20.) AB, 478, 500.].
In the opinion of the movers, those provisions of the Act which regulated the mandatory integration [Points e) and t) of Paragraph (1), Paragraphs (2)-(3) of Section 1, Sections 3, 5, Paragraph (7) of Section 11, Paragraph (3) of Section 18[18], Paragraph (4) of Section 19] violated the freedom of association ensured by Paragraph (2) of Article VIII of the Fundamental Law of Hungary (and, in the same context, the autonomy of action derived from Article II of the Fundamental Law of Hungary). In their supplementary motion submitted after the
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amendment of the Act, the banks extended their petition to the following provisions of the Act: Paragraph (1), Point b) of Paragraph (2), Paragraph (12) of Section 20/A; Paragraph (1) of Section 17/C; Paragraph (1) of Section 17/D; and Paragraphs (3) and (6) of Section 5 - amended with effective date of 30 November 2013 -, Paragraphs (1)-(2) of Section 8 (also amended) of the Credit Institutions Act.
Having collated the content of the right of association declared in the previous Constitution [Paragraph (1) of Section 63], the Constitutional Court did not see anything against considering the principles and findings developed in its previous practice in the judgment of the case at hand-based on Decision No. 13/2013. (VI. 17.) AB (Reasoning [32]). (Béla Pokol, judge of the Constitutional Court was on the opposite opinion, having stressed the difference between the regulations provided by the Constitution and the Fundamental Law.)
Due to the Act, a cooperative credit institution can only operate and function in the future if it is a member of the institutional protection organisation of the integration (SZHISZ) (if it decides to end its membership, then it must obtain a new business licence and it cannot continue its operations as a cooperative). The legislator used the Act to annul the Integration Agreement made by cooperative credit institutions and established the mandatory integration. Membership in the integration means obligations (e.g. payment of the membership fee, adherence to rules, instructions) and rights (e.g. use of institutional protection services at the decision of the directorate of the SZHISZ, protection provided by the Fund).
The Constitutional Court has already studied the institution of mandatory membership in organisations (the so-called involuntary membership). It has concluded that "the freedom of association might be limited by the prohibition of association for a reason and the obligation to associate, i.e. the requirement of forced membership as well. The right of association - as it is a constitutional right - may, however, be limited if the requirements (necessity and proportionality) specified in the decision quoted are met." [Decision No. 41/2002. (X. 11.) AB, DCC 2002, 295, 302.][19]
Accordingly, the Constitutional Court has concluded that the mandatory membership in the SZHISZ (as forced membership) is in direct relationship with the freedom of association and the autonomy of action of organisations, but it means a limitation of them. In the investigation of the constitutionality of this public law limitation it did, however, bear in mind the private law specificities of the autonomy of action of organisations as well.
Accordingly, the subject matter of the investigation of the Constitutional Court was whether the Act's limitation of the right of association or of the autonomy of action corresponds to the test of necessity, proportionality in Paragraph (3) of Article I of the Fundamental Law[20]. After considering the necessity of such a limitation, the Constitutional Court concluded that the assurance of transparent, prudent operations[21] and increasing the security of deposits (and so the protection of the property rights of clients) are such constitutional values that render the limitation of the right of association and the related freedom of action, as fundamental rights, necessary and constitutional.
On the contrary, I share the opinion elaborated in the dissenting opinion of László Kiss [355], who reasoned that, in certain exceptional cases, the Constitutional Court may allow the application of less strictness than the general fundamental right test (described above[22]) in the investigation of necessity. Accordingly, "limitation of the content of law is unconstitutional if it is without any compelling reason, overriding public interest, [...] not absolutely necessary, [...] is not proportionate to the goal to be achieved by the limitation" [e.g.: Decision No. 20/2005. (V. 26.) AB, DCC 2005, 227.]. In his view, the provisions of the Act which limit the right of association, the right to engage into entrepreneurial activities (and the right to property) do not meet even this less stricter test of the limitation of fundamental rights. The primary reason for this was, in his opinion, the fact that he was on a different opinion than the majority reasoning of the
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Decision in the investigation of the provisions limiting fundamental rights regarding the evolution of the division of the obligation to provide evidence for the limitation of the fundamental right. Namely, as he pointed out, reference to overriding public interest might be (exceptionally) important in the application of the fundamental right test. The legislator is obliged to provide evidence of overriding public interest regarding the right of association and the right of engaging in entrepreneurial activities.
András Bragyova - whose train of thought points out the threats of using public interest as a reason for limiting any fundamental right - referred to the fact, on account of the limitation of the right to property, that, regarding public interest, when it comes to the judgement of the limitation of the right to property, as a fundamental right, any purpose of a law can be regarded as the public interest if one can give a logical reason for it. Due to the fact that a constitutional system is neutral in terms of economic policy, economic policy goals can virtually always be accepted as goals of public interest. The Constitutional Court does not check if the "public interest" is really the public interest, but it must accept the political decision of the legislator in general. This derives from the constitutional position and role of the Constitutional Court; the choice between potential regulatory goals and their attainment is the "political" decision of the legislator (at least in the case of property law limitation investigated here) in the limitation of property law justified by economic policy goals. [336].
In other words: the Constitutional Court must accept such a reason in support of the limitation of the fundamental right the existence of which it cannot always check; it can only rely on the reasoning of the legislator.
In his dissenting opinion, László Kiss further pointed out that he could not see any "overriding public interest" (and even less a constitutional goal or value - see Paragraphs [358]-[361] of the dissenting opinion) that could render the forced integration institutionalised by the Act consistent with the Fundamental Law of Hungary.
The primary opinion of the movers was that the Act considerably affects the operations, management, ownership structure of the cooperative credit institutions and the exercising of their ownership rights; thus, it infringes the right to property[23].
In the opinion of the complainants, the following provisions of the Act constitute an intervention (conflicting the Fundamental Law) into the position of owners:
(a) Sections 5 and 16 of the Act, because they wind up voluntary institutional protection funds and their assets are transferred to the SZHISZ;
(b) Paragraphs (2)-(3) of Section 12 of the Act, because they narrow the scope of shareholders of Takarékbank and limit the rights of persons who lawfully acquired shares still before the entry into force of the Act.
(c) Paragraph (4) of Section 13 of the Act (all shareholders of Takarékbank may hold only one type of preferred share) and, in the same context, Paragraph (3) of Section 19 (mandatory deposition of "B" series preferred voting shares and mandatory taking of the new "C" series preferred share), and Paragraph (11) of Section 20 (excluding the option of voting with a "B" series share). The movers found it injurious that they were obliged to take preferred shares of a new series instead of the previous "B" series preferred shares; however, the Act remained silent of the rights attached to such new shares.
(d) Paragraph (3) of Section 14 of the Act (limitation of the right of disposal of the shares held in Takarékbank), because - in the opinion of the movers - this provision is incompatible with the right of free disposal of the subject-matter of civil law property right.
(e) Paragraph (4) of Section 14 of the Act, because it allows the limitation of the rights of cooperative credit institutions as shareholders of Takarékbank in cases depending on the Takarékbank (i.e. the organisation owned); e.g. if capital adequacy does not reach the lev-
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el set by Takarékbank, then the cooperative has not fulfilled the instruction of Takarékbank - and this results in an abnormal situation.
(f) Paragraph (10) of Section 20 of the Act [i.e. the purchase right of MFB regarding the Takarékbank shares, applicable, amongst other cases, when the shareholder does not vote in favour (or abstains or does not appear to vote) the new articles of association of Takarékbank (drafted by the management body of SZHISZ)], which, in the opinion of the movers, renders the option to freely exercise shareholder rights attached to property rights meaningless. The meaning of this provision is namely that, after the changing of the ownership structure of Takarékbank, minority shareholders could not vote in line with their conviction, values or in an autonomous way even at the adoption of the operating rules.
Reacting to the argumentation of the movers regarding the infringement of the right to property, the first thing the Constitutional Court emphasised was, taking its previous practice as a basis, that "the scope of constitutional property-protection is always specific, it depends on the subject, object and function of the property, and also the limitation itself. Viewing it from the other side: depending on the same aspects, the constitutionality of the given type of intervention into property right by public authority is different." (DCC 1993, 373, 379-380.). The same Decision also declared the following: "Due to the specificities of the protection of property, a fundamental right, determination of the constitutionality of the intervention of the state focused, i.e. the actual review of the Constitutional Court is the determination of the proportionality of the ends and means, public interest and the limitation of property rights. In this case, investigation of the necessity, unavoidability of the limitation of a fundamental right requires the consideration of the fact that Paragraph (2) of Section 13 of the Constitution only requires the existence of public interest for expropriation, meaning that if the value guarantee applies, a stricter necessity is not a constitutional requirement. Moreover, the social and economic role of property - especially the compatibility of certain regulatory measures with the given tasks of economic policy - render the ascertainment of necessity or unavoidability much more difficult than in the case of other fundamental rights, where general comparison is more possible. It is a natural phenomenon in democratic societies that the significance of public interest is judged quite differently in economic and social issues affecting property. The Constitutional Court's investigation of the public interest enforced in an act of Parliament is not aimed at the absolute necessity of the choice of the legislator but - even if it is not formally aimed at the existence of public interest but applies the criteria of necessity and proportionality - it must focus on the question whether public interest must be referred to, and whether the solution in the public interest itself does not violate any other constitutional right [...]. However, when it investigates the proportionality of public interest and the limitation of property, the Constitutional Court may, in general, specify the criteria that decide the constitutionality of an intervention. With this, it can counterbalance the unavoidable loss in legal certainty due to the limited revision of the necessity of public interest. The Constitutional Court regards the limitation of property as disproportionate if its duration is not calculable. [...] In other cases, compensation may be necessary for the proportionality of the limitation of property." (ABH 1993, 373, 381-382.).
The Constitutional Court confirmed its position that the right to property is not an unlimitable fundamental right: if the conditions in the Fundamental Law of Hungary are met (and the appropriate guarantees of fundamental rights are respected), state intervention is not excluded.
What the Constitutional Court had to investigate in conjunction with the provisions contested is that if those constitute a limitation of the right to property, then does this limitation serve (according to Paragraph (3) of Article I of the Fundamental Law) the effectiveness of another fundamental right or the protection of a constitutional value to the extent absolutely necessary or the protection of public interest, and if the proportionality of such limitation is determinable.
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The Constitutional Court regarded it as practical to combine the petitions related to the right of property for assessment. It first investigated
a) the motion elements related to the integration, then those related to the capital increase of Takarékbank (see Point 3.3 of the Reasoning),
b) then the petitions challenging the rules of financial risk community (see Point 3.4 of the Reasoning),
c) then the requirements pertaining to the legal succession of institutional protection funds (see Point 3.5 of the Reasoning),
d) finally, it investigated the complaints contesting other provisions of the Act (Points 3.6 to 3.9 of the Reasoning).
First of all, I would like to make the remark that, for reasons of length, in this part, I will only deal with the motion elements mentioned in Point a).
In the investigation of the constitutionality of motion elements concerning the integration, and then the capital increase in Takarékbank, the Constitutional Court concluded that, in terms of the provisions objected by the movers, the potential injury of the right to property is to be investigated in terms of the statutory rules establishing the integration. It must be stressed that the Constitutional Court considered the fact that certain credit institutions operate as subsystems of a highly organised financial system in the investigation. The financial system is a subsystem of the national economy, which is in turn one of the most important subsystems of the social system (next to the political subsystem, for instance). In the opinion of the Constitutional Court, the bankruptcy of a single financial institution could induce a spillover effect through the domino effect; it could have a negative effect on the country risk; this could lead to downgrading and the increase of the sovereign debt; that can have a negative effect on investments, employment, the systems of social care, etc. Nowadays, risk assessment, analysis, prevention and elimination are a primary obligation not only in the financial sector but also among economic and political decision-makers; thus, in government economic strategy and operative management as well. In its assessment of economic policy measures in terms of constitutional law, the Constitutional Court must consider all that [162].
In making its decisions, the Constitutional Court reviewed and considered the background, the content of specific rules introduced for mandatory integration, primarily the provisions indicated and challenged by the movers. It must also be made clear that the Constitutional Court did not examine such provisions one by one in terms of the effect the challenged detailed rules have on the right to property, neither did it examine whether such an effect exists, or if the requirement stands the test of necessity and proportionality of the limitation of a fundamental right, but it judged the provisions (the entirety of the integration) as a single unit. In the opinion of the Constitutional Court, reference to public interest in connection with introduction of integrated operation was, in this case, well-founded on the whole and in a broad context; therefore, it rejected the petitions aimed at the annulment of the challenged provisions of the Act.
In the reasoning of its decision, the Constitutional Court provided the following arguments in support of the existence of public interest to justify the consistency of the limitation of a fundamental right with the Fundamental Law of Hungary.
(a) The maintenance and the functionality of the financial infrastructure is such a public interest that - as a part of the economic and financial policy of the state - might justify interventions affecting property (or financial autonomy), with consideration of the property's social responsibility, role in the national economy and social restriction. The Constitutional Court explained that the organisational system and toolset of integration significantly reduces the independence of cooperative credit institutions in making their economic decisions (all this limits the autonomy of cooperatives); however, it stressed again that, in terms of the limitation of the right to property, it can examine the well-foundedness of the legisla-
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tor's reference to public interest only to a limited extent. This is especially true in case of the so-called reform acts (similar to the one at hand) which transform a business sector according to the objectives of economic policy.
(b) The Constitutional Court continued the enumeration of the arguments corroborating the existence of public interest; this allowed for the conclusion that the protection of the interest of hundreds of thousands of depositors at the savings cooperatives and the security of their deposits is obviously the interest of the public, because the deterioration of the trust in deposits with savings cooperatives affects the security of all kinds of deposits (this includes bank deposits as well), and through this, the interest of every depositor in the country and the interest of the entire national economy as well. The autonomy of small units that have operated in a fragmented structure so far becomes weaker on the one hand, their unified economic and financial power becomes, on the other hand, stronger, thanks to the improvement in their efficiency and security. The body stated that, in addition to the stability of the sector (which serves the protection of the interest of the depositors), profitability may also improve (the transformation is also in the longterm interest of the owners).
(c) The Constitutional Court perceives the screening of cooperative credit institutions, and so the detection of hidden risks, and so the real situation[24], also as public interest. The reduction of operational risks of this sector was also in the interest of the public; it is now ensured by the risk management following the uniform rules established through the integration and the financial contribution of the state.
(d) In conclusion, the Constitutional Court regarded the intensification of crediting activities of cooperative credit institutions as an interest of the public in terms of the development of the national economy, and this is ensured by the financial contribution of the state and the fact that the assets of the SZHISZ constitute a solvency margin.
In the examination of the proportionality of the limitation, the Constitutional Court regarded it as an important aspect that, although the controlling rights of the integration determine the autonomous operation of cooperative credit institutions, this is compensated by the benefits of coordinated operations (primarily the reduction of business risks and the increasing of profitability) and the fact that the state provides considerable amounts through MFB as a contribution to institutional protection in order to protect the stability and security of the sector - so increasing its financial stability. In the opinion of the Constitutional Court, in legal terms, the state does not only take away elements of the system (from the self-determination of certain credit institutions), but it also adds new elements to it (material coverage, security). The Constitutional Court stressed at the same time that the legislator reduced the self-determination of the credit institutions involved in the integration in economic and financial matters so much through the control rights provided to Takarékbank and SZHISZ in the Act - and this constituted such an intervention into the right to property -that it would be in conflict with the Fundamental Law if there were not any counterbalancing benefits. Economic and financial autonomy (and its reduction) cannot be precisely evaluated; thus, the HUF 136.5 billion (provided by MFB as a result of preliminary audit assessment) asset of SZHISZ could be considered as compensation for the limitation only, but not the values of other benefits (hoped for).
Given the fact that even complete expropriation may be constitutional if it serves the interest of the public and value guarantee applies, integration of cooperative credit institutions, coordination of their activities is an action that affects their self-determination to a lesser extent. Moreover, in its Decision No. 64/1993. (XII. 22.) AB, the Constitutional Court has already concluded that "the increasing number of limitations by the law extend the concept of 'classical expropriation' which the state used to acquire ownership (usually real estate) for a public goal if it could not do so in a civil law transaction. However, as more and more limitations of ownership enjoy a protection similar to expropriation, more and more limitations must be tolerated without any compensation" (ABH 1993, 373, 381.).
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This constitutional law argument was corroborated both by the second sentence of Paragraph (1) of Article XIII of the Fundamental Law (Property shall entail social responsibility.) and the economic policy measures that were necessary in the sectors exposed to the economic and financial crisis.
Having regard to the specificities of the sector of cooperative credit institutions and the foregoing, the Constitutional Court found that the limitation of the fundamental right was necessary and proportional; therefore, it rejected the petitions aiming at the annulment of the challenged provisions.
What I cannot accept in the reasoning of the Constitutional Court is the wording reading that the challenged provisions of the Act constituted an intervention into the right o property, which would be in conflict with the Fundamental Law if there were not any counterbalancing benefits, i.e. the Constitutional Court regarded the amount provided by the state and "security" as benefits compensating the limitation when it examined the proportionality. In my opinion, however, the examination of proportionality should have focused on the relationship between extent of the limitation of the fundamental right and the public interest[25]. I agree with the dissenting opinion of András Bragyova, if the constitutionality of the limitation of property depends virtually on the result of the examination of proportionality. Proportionality means the relationship between the goal and extent of the limitation. The examination of the limitation of property deals with the question what social situation the norm wishes to create or reinforce through the limitation of property, then we compare this with the extent of the limitation. If the limitation of the fundamental right is a compelling outcome of the goal of the norm (as understood above), and there is not an easier way (which would not limit the fundamental right that much) to achieve the goal, then the limitation is acceptable in terms of constitutional law, i.e. it is not disproportionate.
Due to the specificities of the protection of property, a fundamental right, determination of the constitutionality of the intervention of the state focused, i.e. the actual review of the Constitutional Court is the determination of the proportionality of the ends and means, public interest and the limitation of property rights. Consequently, the right to property may be constitutionally (i.e. without the payment of a value guarantee) limited in the favour of public interest until the extent of the limitation is proportionate to the goal (public interest) to be achieved. In certain cases, however, a serious encumbrance/limitation of property (but still not the case of classic expropriation) may require the compensation, or mitigation, of the loss, i.e. a value guarantee of some extent.[26] The reason for this is guaranteeing the proportionality between the encumbrance/intervention and the public interest justifying that. Therefore, in such a case, the value guarantee is an element of proportionality.
The principle of value guarantee must prevail, i.e. a form of protection similar to the one applied in case of expropriation must be provided if the limitation for the interest of the public might be considered material, because it produces a situation similar to expropriation (without the specific taking away of the thing), i.e. the person concerned is forced to make an inequal and unacceptable sacrifice, and this is a material intervention into his/her right to property protection.
In its majority-based reasoning, the Constitutional Court specified the scope of interests that might be regarded as public interest, and it explained that the challenged provisions of the Act constituted such an intervention into the right to property which would conflict the Fundamental Law in the absence the benefits counterbalancing it. It must be stressed that the Constitutional Court did not say that the limitation of property is so grave in this case that it would require a compensation for the loss; still, it considers the counterbalancing benefits in its opinion; these benefits still provide a compensation (i.e. the Constitutional Court did tacitly recognise that the limitation of property produces a situation which is almost as serious as if it was expropriation). With this, the Constitutional Court accepted the compensation provided by the state (constituting in the benefits and amounting to HUF 136.5 billion) as sufficient, which rendered the relevant provisions of the Act compliant with the Fundamental Law.
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It may be concluded that the Constitutional Court did not ignore the fact that the substantial issue in the determination of the constitutionality of the objected integration process is the economic role of the state (its justifiedness, extent and manner, i.e. its necessity and proportionality) in its decision, therefore it briefly reviewed its history, considered the current challenges the global economy and the European integration face, the relationship between the economic, financial and legal subsystems in the entire society.
The Constitutional Court also stressed that its practice related to the economic role of the state must be reviewed as well, bearing in mind the current setting of the national economy, finances and public finances and the values expressed in the Fundamental Law of Hungary, because it was especially the issue of the economic role of the state in which Hungary went through a very specific and radical change, shifting from a centrally planned economy to a market economy. After reviewing Decision No. 33/1993. (V. 28.) AB laying down the general basis for the relationship with economic policy, the Constitutional Court referred its Decision No. 21/1994. (IV. 16.) AB to point out that the Constitutional Court had stated in it that "the only direct characteristic the Constitution provided for the market economy was that public property and private property are equal and enjoy the same protection. The Constitution does not commit itself to any substantive model of the market economy. [...] Therefore, the Constitutional Court determines the critical extent of 'state intervention' in an abstract manner, generally, only for extreme cases; if this is exceeded, then it is considered unconstitutional, due to the injury of the market economy. This applies to such interventions that would conceptually and obviously exclude the existence of the market economy; such as general nationalisation and strict, centrally planned administration. [...] Maintenance and protection of the market economy is also a continuous constitutional responsibility, which the state can and must ensure though the 'support' of economic competition (as also required by the Constitution), but, first of all, through the enforcement and protection of each fundamental right. Such fundamental rights protection does, however, have its own methodology and characteristics. (E.g. the provisional nature of the limitation of property, as a component of proportionality, is already a real standard of constitutionality. This is the permanent practice of the Constitutional Court: DCC 1991, 22, 27.; DCC 1992, 95, 126, 129.)". (DCC 1994, 117, 119-120.)
In this issue, the Constitutional Court sustained its previous practice in its Decision No. 8/2010. (I. 28.) AB, and amended it with the followings, referring to its Decision No. 59/1995. (X. 6.). "The elaboration of economic policy, more specifically, the supporting of certain activities, the encouragement or de-emphasising of investments do not constitute an issue of constitutionality (Decision No. 620/B/1992. AB, DCC 1994, 542.). They become an issue of constitutionality if the direct legislative implementation of economic policies injures constitutional right(s) or discriminates. [Decision No. 59/1995. (X. 6.) AB, DCC 1995, 295, 300.]" (DCC 2010, 23, 54.)
This makes it understandable and acceptable that the Constitutional Court may not eliminate the specific economic and financial situation inducing the adoption of acts in the examination of their constitutionality, this might, however, in my opinion, intensify the negative practice that finds endless limitations of fundamental rights to be consistent with the Fundamental Law through reference to any reasons attributable to the interest of the public and in exchange for state compensation (without the establishment of expropriation).
Reduction of the level of protection is becoming more and more pronounced in case of certain fundamental rights. The best example in this case is the "reduction" of the level of protection of the right to property (having regard to the sectors exposed to the economic and financial crisis) which is shown by the following argumentation. In this case, the Constitutional Court itself explained that the
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argument of constitutional law saying that more and more types of limitation of property are eligible to protection similar to that available in case of expropriation, more and more types of limitation must be tolerated without any kind of compensation - both by the second sentence of Paragraph (1) of Article XIII of the Fundamental Law (Property shall entail social responsibility.) and the economic policy measures that were necessary in the sectors exposed to the economic and financial crisis [174] - became stronger.
In summary, in may opinion and in agreement with the concurring reasoning of Béla Pokol, judge of the Constitutional Court, it may be concluded that if the Constitutional Court adopts a decision that sets the precedent and lays down the extent of state intervention into the economy in a manner consistent with the Fundamental Law through the investigation of such legislation, then the legal setting created by the Fundamental Law of Hungary may not be ignored. I am therefore of the opinion that the Constitutional Court should not develop the argumentation of this "mega decision" by mechanically applying the practice elaborated based on the previous Constitution, without any review in the light of the Fundamental Law. It did, however, do so; moreover, withdrawal from the scope of protection (with reference to the interest of the public) was formulated regarding certain fundamental rights in the meantime - a fact which the Constitutional Court also recognised. This concept of public interest in the decision is also based on the consideration of the aspects of economic policy.
As some kind of a margin note to my paper, I would like to make the remark that qualifying limitations of fundamental rights as consistent with the Fundamental Law through reference to the interest of the public leads to a dangerous practice. In my view, the Constitutional Court should apply a strict approach in declaring limitations of fundamental right as consistent with the Fundamental Law by referring to the interest of the public. It may, however, be concluded that the Constitutional Court cannot check the goals, reasonable reasons defined by the legislator; thus, as a matter of fact, it accepts the arguments of the legislator comme il faut as reasons supporting the existence of the interest of the public. To support this opinion, I would refer to the thoughts of András Bragyova: when it comes to the judgement of the limitation of the right to property, as a fundamental right, any purpose of a law can be regarded as the public interest if one can give a logical reason for it. Due to the fact that a constitutional system is neutral in terms of economic policy, economic policy goals can virtually always be accepted as goals of public interest. The Constitutional Court does not check if the "public interest" is really the public interest, but it must accept the political decision of the legislator in general. This derives from the constitutional position and role of the Constitutional Court; the choice between potential regulatory goals and their attainment is the "political" decision of the legislator (at least in the case of property law limitation investigated here) in the limitation of property law justified by economic policy goals. This "political" decision is usually kept for the lawmaking political majority according to the principles of representative democracy: this majority warrants the content of public interest and bears the (political) responsibility for it. The Constitutional Court does not examine the purpose of limiting property rights, it - lets say - puts the public interest between brackets, accepting that the regulations serve some kind of a public interest. If there is any conceivable public interest (at least the shared interest of a larger group (and not only its members)), then this can be accepted as a justification for the limitation of property. It must be noted that the partiality of the legislator is much better proven by the infringement of the rule of equality (Article XV. of the Fundamental Law of Hungary), than by the limitation for public interest" [336]. ■
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] http://www.jogiforum.hu/interju/122
[2] Compare with Péter Tilk: Thoughts on the narrowing of investigation options of the Constitutional Court. In: István Ambrus, Adél Köblös, Krisztina Strihó, Márton Sulyok, Anikó Szalai, László Trócsányi (ed.): Dikaiosz logosz [Dikaios logos]: Tanulmányok Kovács István emlékére [Studies in Memoriam István Kovács]. Szeged, Pólay Elemér Alapítvány [Pólay Elemér Foundation], 2012; Péter Tilk: Az Alkotmánybíróság eljárásának korlátozása és az ehhez vezető események [Limitation of the procedure of the Constitutional Court and the preceding events]. De Iurisprudentia et Iure Publico 2011/5.; Péter Tilk:
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Az Alkotmánybíróság az Alaptörvényben. [The Constitutional Court in the Fundamental Law.] Public Law Review 2011/4.
[3] As this paper is limited in length, I do not discuss all the issues that arose in this context. They will be discussed in a separate paper.
[4] Compared to its previous practice, i.e., its, in my opinion, abandonment of the protection of property.
[5] Act CXXXV of 2013 on the integration of cooperative credit institutions and amendments to economy-related legal regulations is hereafter abbreviated as the Act.
[7] According to the OTSZ (Országos Takarékszövetkezeti Szövetség, in English: National Association of Savings Cooperatives); http://privatbankar.hu/penzugyek/lattak-mar-ilyen-torvenyt-kiutotte-a-biztositekot-a-kormany-a-takarekoknal-259344
[8] http://www.parlament.hu/irom39/11651/11651-0001.pdf
[9] According to Paragraph (3) of Section 18 of the Act, entry into force of this Act shall repeal the Integration Agreement of Savings Cooperatives concluded on 13 October 1993, gaining a new content on 29 April 1998 and amended from time to time ever since.
[10] Magyar Fejlesztési Bank Zrt. (Hungarian Development Bank Private Limited Company, hereinafter: MFB)
[11] The legislator adopted a separate act on the contribution of MFB, in Paragraph (1) of Section 20 of the Act: Within the meaning of Act CLVI of 2013 on the integration Fund of Cooperative Credit Institutions, the legislator established a separate state fund to which it pays moneys as budget support (the amount of such budget support is HUF 135,499,600,000, according to Point 5 of Annex 1 of Act CCVI of 2013 on the amendment of Act CCIV of 2012 on the Hungarian budget for 2013).
[12] Based on Paragraph (2) of Section 12 of the Act.
[13] In this context, see: Ildikó Kovács - Péter Tilk: Thoughts on the starting point for calculating the required preparation time. Jogtudományi Közlöny [Gazette of Legal Science], 2015/11.
[14] According to Paragraph [53] of the Reasoning to this Decision, the Constitutional Court refused other motion elements concerning public law invalidity and established on reasons different from the non-provision of the preparation time in Point 9 of the operative part.
[15] Decision No. 20/2014. (VII. 3.) AB, Paragraph [125] of the Reasoning.
[16] These are the following: The time-limit for making the preliminary statement of undertaking regarding the acceptance of the "C" series preferred shares of the Takarékbank and to deposit their "B" series preferred shares was 15 days; the timelimit for initiating the issuance of a business license complying with the Act at the Hungarian Financial Supervisory Authority was 20 days; the time-limit for adopting their own new articles of association/instrument of incorporation with a wording determined by the management body of the SZHISZ was 45 days; the time-limit for obtaining the operating license was 75 days (under the condition that the Act provided a time limit of 8 working days for the Supervisory Authority to decide in each case).
[17] Paragraphs [233]-[238], [241] of the Reasoning of Decision No. 6/2013. (III. 1.) AB of the Constitutional Court
[18] The legislator adopted Act CXCVI of 2013 to rescind Paragraph (3) of Section 18 of the Act with effective date of 30 November 2013. The Constitutional Court investigates whether a rescinded legal regulation is inconsistent with the Fundamental Law of Hungary only exceptionally, if the legal regulation needs to be applied in a specific case [Paragraph (3) of Section 41 of the Constitutional Court Act]. The Constitutional Court, therefore, closed the procedure for Paragraph (3) of Section 18 of the Act, based on Point e) of Section 64 of the Constitutional Court Act.
[19] This Decision did, therefore, repeat and confirm the previous conclusion that "forced membership is a direct limitation of a fundamental right, no matter if it is (depending on the theoretical understanding) the right of association or the general freedom of action (Section 54 of the Constitution); therefore, it constitutionality must be measured with the usual fundamental right test. "[Decision No. 38/1997. (VII. 1.) AB, DCC 1997, 249, 257.]
[20] According to this, a fundamental right may be limited with a view to the effectiveness of another fundamental right or the protection of a constitutional value, to the extent absolutely necessary and in proportion to the goal to be achieved, respecting the substantial content of the fundamental right.
[21] [146]: The institutional structure established in order to ensure the prudent and profitable operations of the members and the mechanisms (instructions, sanctions) introduced in order to implement requirements serve the functioning of the integration.
[22] See: Decision No. 20/2014. (VII. 3.) AB: Reasoning [351]-[352]
[23] Paragraph (1) of Article XIII of the Fundamental Law
[24] Based on Paragraph (5) of Section 19 of the Act [and Paragraph (16) of Section 15 of the Act].
[25] The basis of my opinion: Decision No. 64/1993. (XII. 22.) AB
[26] See: Decision No. 64/1993. (XII. 22.) AB.
Lábjegyzetek:
[1] The Author is Doctoral Student, Doctoral School of the Faculty of Law at the University of Pécs.
Visszaugrás
