The first draft of the new Hungarian Civil Code was published in 2006. The Code will repeal Act IV of 1959, the Civil Code in force. The reason for adopting a new Civil Code is that the current Code has been amended more than 150 times. The Government foresees that the new Code shall be the legislative conclusion and summarisation of the process of the change of the regime from a centrally planned socialist economy to a multi-party democracy with market economy. The new Code shall meet three requirements: it shall cover the most important parts of civil law, it shall give answers to newly emerged economic needs, and finally, it shall solve existing dogmatic problems. In line with these principles the draft broadens the scope of the Code by incorporating e.g. family law, the law of negotiable instruments and material rules of land registry; however the Code will still not contain rules on company law and labour law. The draft significantly modernises civil law: it introduces detailed regulation for registered and unregistered partnership, and fundamentally amends the law of secured transactions. In accordance with the third principle, the draft creates the common rules for all obligations, although it still does not provide rules for juristic acts in the field of property law. If these principles are followed, the Code might play a significant role in the removal of trade obstacles and the reduction of legal uncertainty and, thus, lead to an enhanced economy with lower transaction costs and more easily accessible credit.
