Hungary’s New Law Targeting Civil Society Organizations Is an Attack on Democracy

BUDAPEST—The Hungarian Parliament’s decision to pass a law targeting the funding of independent civil society groups is a serious attack on Hungarian democracy, unprecedented elsewhere in Europe, the Open Society Foundations said today.

“Cosmetic changes to the law in response to the Venice Commission have not altered the law’s true intent; it seeks to suppress democratic voices in Hungary just when the country needs them most. It attacks Hungarians who help fellow citizens challenge corruption and arbitrary power, and who stand up for free and independent media and for open debate,” said Goran Buldioski, director of the Open Society Foundations’ work in Europe.

The Venice Commission, the Council of Europe’s constitutional law expert advisory body, stated on June 2 that the law imposes excessive obligations on NGOs, disproportionate sanctions, and criticized “a virulent campaign” by Hungarian authorities against foreign-funded NGOs. In response, the Hungarian government enacted minor amendments but left untouched the most harmful elements including the provision to stigmatize organizations as “foreign funded” and the threat to legally dissolve an organization if it does not register as foreign funded. The government also rejected as “political” a call by the commission to involve affected groups in a public consultation on the bill.

Buldioski noted that “the law ignores the main Venice Commission recommendations, but in doing so, it violates EU law protecting the freedom of association, the free movement of capital, and freedom from discrimination. It undermines the very fundamentals of European democracy.”

The Hungarian government claims that the law is needed for additional transparency and to address unspecified “national security” concerns. However, the provisions proposed address neither, and NGOs already fulfill transparency requirements. Moreover, the law does not apply to religious and sports organizations, so it targets only democracy and rights groups.

“The notion that the groups it targets represent a threat to national security is absurd; the Hungarian people are being misled about the law’s real purpose, and it must be reversed,” added Buldioski.

The law stigmatizes civil society organizations that already comply with robust transparency measures, including statutory requirements to publish all funding. A number of NGOs will now pursue available options in Hungary to challenge the new law as unconstitutional. 

Peter Nizak, head of Open Society’s work in Hungary said: “We continue to believe in the rule of law and democracy in Hungary and endorse the actions of those NGOs who have said they will challenge its legality; the NGOs that will be particularly hard hit by this discriminatory and unnecessary law have our full solidarity.”

The European Parliament has already called for the unprecedented launch of Article 7 procedure due to the emerging systemic threat to the rule of law in Hungary that represents a clear risk of a serious breach of the values of the European Union.

This law is additional confirmation of the systemic threat to those values, and to rights legally protected by the EU Charter of Fundamental Rights. Beyond its violation of EU law, the law also breaches a number of European and international standards:

• The UN Human Rights Council’s resolution 27/31 “calls upon states to ensure that they do not hinder the work of civil society,” and “underlines the importance of the ability to solicit, receive, and utilize resources for their work.”
• The Council of Europe, in its 2007 recommendations on NGOs, has said that governments should assume “the activities of NGOs should be presumed to be lawful in the absence of contrary evidence.”
• The intergovernmental Financial Action Task Force, which develops policies to combat money laundering and terrorist financing, has warned against anti–money laundering laws being used to suppress legitimate NGO activity. It also stresses that governments should not impose blanket measures when there is no evidence of a threat.

The Hungarian government has failed to produce any evidence of a threat or wrongdoing by the NGOs targeted through this law. In 2014, NGOs that received funding from the EEA/Norway grants were subjected to government-ordered financial inspections and police raids. Budapest courts later found the police raids unlawful and cleared the organizations of any financial wrongdoing.

“The government fell foul of the law in their 2014 attacks on NGOs and is now trying to manipulate the law itself to undermine any groups that are critical of government,” concluded Nizak.