Court Rebukes Hungary for 2014 Land-Use Cancellations

(CN) - The European Court of Justice slammed Hungary on Tuesday for canceling the land-use rights of non-Hungarian nationals within its borders.

Hungary adopted the scheme back in 2013, saying that only people with a close family tie to agricultural land in the nation were entitled to property-use rights, which are otherwise known as usufruct. In October 2014, about five months after Hungary had canceled the land-use rights of nationals of outside member states, the European Commission warned the government that it was infringing the Treaty on the Functioning of the European Union.

Hungary would not back down, however, prompting the commission to file suit in Luxembourg.

As summarized by the European Court of Justice on Tuesday, the commission argued that no public interest justifies “the removal of rights of usufruct to the detriment of thousands of non-Hungarian citizens.

Insisting that the commission could not show discrimination, Hungary pointed out that only 5,058 of the more than 100,000 people affected by the scheme were nationals of other countries including third states. 

Hungary called it only natural that the close-family-tie exception generally favors Hungarian nationals, “given that the land concerned is located in Hungary and its owners are usually Hungarian.”

“That exception takes into account the fact that parents frequently buy property for their children over which they create a right of usufruct for themselves and the fact that a surviving spouse often inherits such a right,” Hungary argued, as summarized in the ruling Tuesday.

Rejecting the country’s submissions, however, the Grand Chamber of the European Court of Justice ruled Tuesday that “the restrictions on the free movement of capital thus arising from the deprivation of property acquired using capital protected by Article 63 TFEU cannot be justified.”

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