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ECHR Declares Savings Coop Integration Case Against Hungary Inadmissible

MTI-Hungary Today 2020.07.08.

The European Court of Human Rights (ECHR) has declared a case brought by shareholders of savings cooperatives in Hungary against the state inadmissible.

The shareholders turned to the court after Hungary’s government combined the country’s savings cooperatives to ensure compliance with stricter EU rules on capital requirements.

In the case lodged in 2014, the shareholders complained that the relevant legislation had “excessively interfered” with the exercise of their ownership rights, including appointing board members and deciding on dividends.

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The court unanimously decided against ruling, arguing that the law’s provisions neither targeted nor undermined the rights of shareholders. The cooperatives themselves rather than the shareholders had the right to appeal, the court said, since the executive boards were affected by the law.

The court also noted that other European Union member states have placed restrictions on the operation of credit institutions due to the risks to the wider economy of inadequate regulation.

Featured photo illustration by pixabay.com.