EC starts legal action in row with Hungary

THE EUROPEAN Commission (EC) launched legal proceedings against Hungary yesterday over the independence of its central bank, data protection authorities and judiciary.

Hungary brought in legislation to increase the number of central bank directors and give politicians more control over their appointment at the beginning of the year, under its contentious new constitution.

The commission has identified several breaches of primary law – by which countries must abide to join the EU – most notably Article 130 that stipulates full central bank independence.

President Jose Manuel Barroso sent letters in December voicing concerns. In addition, EC vice-president Neelie Kroes was repeatedly in contact with the Hungarian authorities last year.

“Governments must refrain from seeking to influence their central bank,” said vice-president Olli Rehn. “This needs to be addressed before we can start formal negotiations on the requested EU/IMF financial assistance.”

The Hungarian government will co-operate fully to find a solution preferably without going through the full infringement procedure, according to a spokesperson.