The law includes basic provisions of the 2013 law on complaints and reports of matters of public interest and introduces a system of internal reporting of breaches.

The government submitted the legislation to adopt into national law the EU’s 1937 directive passed in 2019 on the protection of persons who report breaches of EU law.

According to the directive, unlawful activities and abuse of law may occur at an entity in the private or public sector irrespective of its size and can take many forms including corruption, fraud, businesses’ malpractice or negligence. A lack of addressing such activities can result in serious harm to the public interest, the directive says.

The law passed by Hungarian lawmakers on Tuesday requires entities in the private sector employing at least 250 people to establish a communication channel for reporting breaches and investigate the reports.

Entities in the sector with fewer, but at least 50 employees are required to set up a common internal reporting system and guarantee its operation defined in the law.

In the public sector, the law requires the establishment of an internal reporting system at every organisation whereas local governments of a settlement with fewer than 10,000 inhabitants or institutions with fewer than 50 employees are exempt of the legislation.

It however allows local governments the option to establish a joint reporting system. The law provides for a whistleblower to be able to report a case externally to a designated state organisation and defines guarantees for their protection against retaliation.

The law was passed with 118 votes in favour, 23 against and 24 abstentions. It will enter into force on the 60th day after its promulgation.

MTI Photo: TIbor Illyés