Lobbying in Hungary has a poor track record, according to TI, neither the prevailing rules nor their practice are adequate and the situation has only gotten worse in recent years. The study addresses a lack of regulations and an unprecedented concentration of power, as a key contributor to hidden, “unorthodox” lobbying forums in Hungary. The study suggests that strategic agreements between the government and corporations could be one such forum.

When it comes to agreements of a political or communication nature, the government applies arbitrary distinctions between market players, the report said. In the absence of a relevant law, companies lobby in an uncontrolled and non-transparent manner and there is now way of determining how each strategic agreement was reached, it said.

The moment Prime Minister Viktor Orbán's government methodically weakened the institutions of the rule of law whose role it was to limit the power of the executive branch, the system of checks and balances was essentially eliminated, according to the report, which adds that this change made it easier to pass laws that infringed upon property and business rights, such as the levying of special taxes within certain economic sectors.

According to the TI study, the agreements between the government and companies are not evil in nature, but practice reveals that these agreements place no responsibility on either party. These strategic agreement are more akin to a declaration of intent with which companies can assure the government of their loyalty, while the government promises to bury the hatchet in exchange. The anti-corruption organization's concern here is that it is not clear with which companies the government signs strategic agreements and what considerations are employed.

The study also suggests that issues are discussed in inappropriate forums, and TI has urged that new regulations be created. “In the absence of any law, it is only possible to lobby in an uncontrolled and non-transparent manner, which means there is no chance that we will ever know which strategic agreements were reached in the VIP seats at a football match and which were reached in one of the government’s eastern business meetings,” Miklós Ligeti, the director of TI Hungary, pointed out.

Any future lobbying regulations can only be effective and sustainable in Hungary if it is supported by all relevant parties, according to TI. The report said that the implementation of lobbying regulations should be entrusted to an organization independent of its stakeholders – meaning the government and corporations.

This would allow for the state to legitimately oversee the lobbying relationships of MPs and other public officials presiding over public funds. According to TI, the transparency of the public authorities' decisions would also improve if state employees were required to file detailed reports with lobbyists and other interest groups, of their official and unofficial contacts, and have these reports scrutinized by the new lobby authority.

By Christian Keszthelyi

Source: BBJ.hu

Budapest Business Journal is a media partner of XpatLoop.com