EU Sues Hungary Over Defense Of Sovereignty Law

The Hungarian National Assembly adopted the Defense of Sovereignty Act in 2023 (Wikimedia Commons)

The European Commission formally issued a suit against Hungary for its “Defense of Sovereignty” law on October 3. This follows Hungary’s “unsatisfactory” response to notices expressing concern about the establishment of the Office for the Defense of Sovereignty in December 2023. According to the Commission, the Defense of Sovereignty law violates the EU Charter for Fundamental Rights, the Internal Market Fundamental Freedoms, and EU Data protection legislation by empowering the Office for the Defense of Sovereignty to intervene in an “intrusive manner” when investigating the activities of actors using foreign funding to influence election outcomes. 

The National Sovereignty Act

The National Assembly of Hungary adopted the Defence of National Sovereignty Act in December 2023, creating the Office for the Defense of Sovereignty to investigate actors suspected of behaving on behalf of a foreign body, organization, or person. The Office is additionally responsible for sending an annual public report on its findings to the government and parliamentary Standing Committee on National Security. These provisions are largely a response to the belief that foreign entities have been promoting economic and migration policies antithetical to Hungary’s national interests. The new law does not allow individuals to contest decisions of the Sovereignty Office. 

The European Commission formally expressed its concerns in February 2024, citing a breach of the EU Charter of Fundamental Rights, Internal Market Fundamental Freedoms, and EU market protection legislation. The Commission holds that the Sovereignty Act threatens to impose arbitrary restrictions on NGOs and inhibit the free movement of capital between member states. It also claims that the Office’s authority to request sensitive data violates statutes protecting individual privacy. Hungary responded to these grievances by denying any legal infringement and proceeding to ignore a second notice sent in May 2024. The United States has called the Sovereignty Act a “draconian” attempt to “harass, intimidate, and punish independent organizations,” despite having a similar law, the Foreign Agents Registration Act (FARA), which mandates public disclosure and registration with the Department of Justice for “foreign agents” engaged in domestic lobbying or advocacy. 

Former Hungarian Minister of Justice Judit Varga defended the Sovereignty Act, stating that the Commission’s initial move against it “stands as further proof that bureaucrats in Brussels are not willing to acknowledge the attempts of foreign NGO networks who want to gain influence in EU member states.”

The Trajectory of Brussels-Budapest Relations

The EU Commission promulgated its decision to refer Hungary to the Court of Justice of the European Union on October 3. This came just days after the Commission initiated a procedure to deduct from Hungary’s share of the EU budget after the country’s refusal to pay a 200 million euro fine for failing to comply with immigration asylum policy. These developments reflect the deterioration of Brussels-Budapest cooperation, made especially prominent by Hungary’s six-month presidency of the EU Council.