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Coronavirus Measures in Hungary: Extension of Payment Moratorium

Coronavirus Measures in Hungary: Extension of Payment Moratorium

Hungary
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In March 2020, the coronavirus crisis urged the Hungarian government to introduce extraordinary measures to mitigate the economic consequences. This led to a general moratorium for all retail and corporate financings until the end of 2020. As one of the last measures of 2020, the Hungarian government decided to prolong the moratorium due to the second wave of the pandemic.

Under the first moratorium, capital, interest and fee payment obligations for all loan, credit and financial leasing agreements were suspended in both the retail and corporate sectors. The moratorium was voluntary for borrowers (opt-out) and mandatory for banks, i.e. debtors may continue performing their contractual obligations if they wish to.

In October, the moratorium was extended until 30 June 2021 for certain people in need (e.g. unemployed, pregnant or retired) and companies in financial difficulties. The prolonged moratorium remains voluntary for borrowers and mandatory for banks. It has also been clarified that it is applicable only to lenders having a seat or branch office in Hungary. The moratorium is applicable to contracts concluded before 18 March 2020 and loans that have already been utilised.

Unfortunately, the pandemic did not relent in December. The government therefore decided that the prolonged moratorium will apply not only to the above limited group, but to any debtor who has capital, interest or fee payment obligations arising from a contract concluded on a commercial basis.

By Gergely Szaloki, Partner, and Virag Palguta, Attorney at Law, Schoenherr

Hungary Knowledge Partner

Nagy és Trócsányi was founded in 1991, turned into limited professional partnership (in Hungarian: ügyvédi iroda) in 1992, with the aim of offering sophisticated legal services. The firm continues to seek excellence in a comprehensive and modern practice, which spans international commercial and business law. 

The firm’s lawyers provide clients with advice and representation in an active, thoughtful and ethical manner, with a real understanding of clients‘ business needs and the markets in which they operate.

The firm is one of the largest home-grown independent law firms in Hungary. Currently Nagy és Trócsányi has 26 lawyers out of which there are 8 active partners. All partners are equity partners.

Nagy és Trócsányi is a legal entity and registered with the Budapest Bar Association. All lawyers of the Budapest office are either members of, or registered as clerks with, the Budapest Bar Association. Several of the firm’s lawyers are admitted attorneys or registered as legal consultants in New York.

The firm advises a broad range of clients, including numerous multinational corporations. 

Our activity focuses on the following practice areas: M&A, company law, litigation and dispute resolution, real estate law, banking and finance, project financing, insolvency and restructuring, venture capital investment, taxation, competition, utilities, energy, media and telecommunication.

Nagy és Trócsányi is the exclusive member firm in Hungary for Lex Mundi – the world’s leading network of independent law firms with in-depth experience in 100+countries worldwide.

The firm advises a broad range of clients, including numerous multinational corporations. Among our key clients are: OTP Bank, Sberbank, Erste Bank, Scania, KS ORKA, Mannvit, DAF Trucks, Booking.com, Museum of Fine Arts of Budapest, Hungarian Post Pte Ltd, Hiventures, Strabag, CPI Hungary, Givaudan, Marks & Spencer, CBA.

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