Hungary law on NGOs' foreign funding found to break EU rules

BUDAPEST, Hungary (AP) — Restrictions imposed by Hungary on the foreign funding of non-governmental organizations do not comply with EU law, the Court of Justice of the European Union said Thursday.

The Luxembourg-based court said that Hungarian regulations — in effect since 2017 and nominally meant to increase transparency of NGO finances and combat money laundering, “introduced discriminatory and unjustified restrictions” on both the civic groups and their backers.

The court found that the Hungarian law was in violation of EU rules on the free movement of capital and EU fundamental rights like the right to respect for private and family life, the right to freedom of association and the right to protection of personal data.

The rules, backed by the government of Prime Minister Viktor Orban, were seen targeting mainly groups at least partially financed by Hungarian-American billionaire George Soros, like rights advocate the Hungarian Helsinki Committee and corruption watchdog Transparency International.

Orban has made total opposition to immigration a key policy issue. He began targeting the foreign funding of NGOs soon after his return to power in 2010, but his hostility to their activities intensified after the 2015 migration crisis, as some of the NGOs provide legal assistance to asylum-seekers or help refugees with their integration efforts in Hungary.

The EU court upheld the European Commission’s action against Hungary, launched after the government refused to repeal the regulations. Without commenting in detail on the ruling, Orban’s chief of staff, Gergely Gulyas, said the government would comply with the court’s decision.

Reacting to Thursday's ruling, the European Commision said that “a strong, vibrant and civil society is key to upholding the common European values of the rule of law, fundamental rights and democracy.”

“This is an important ruling which protects the freedom of association, of civil society organizations in the EU and reaffirms the internal market rules,” European Commission spokesman Christian Wigand said during a press briefing in Brussels.

According to the law, Hungarian civic groups getting more than 7.2 million forints ($23,500) a year from foreign donors have to register the fact with the courts and announce on their online and printed publications that they are foreign-funded.

The groups also have to list any foreign sponsors giving them more than 500,000 forints ($1,630) a year.

NGOs welcomed the EU court ruling, as did the Soros organization supporting civic groups in Hungary and elsewhere.

“Today’s landmark decision deals a blow to the Hungarian authorities’ efforts to stigmatize and undermine civil society organizations who criticize government policy," said David Vig, director of Amnesty International Hungary.

“The law ... is a blatant attempt to muzzle critical voices and chip away at public support for organizations fighting for human rights, justice and equality."

According to Patrick Gaspard, the president of Soros' Open Society Foundations, "repealing the law would mark a welcome step towards restoring both the rule of law, and pluralism in public life.”

Twenty-three NGOs had requested a review of the law by Hungary's Constitutional Court, but the court had suspended its procedure pending the EU court decision.