ZOiS Spotlight 24/2021

The Hungarian Government Takes Further Steps Against NGOs

by Melanie Hien 23/06/2021
Budapest, Hungary. Protesters against the first NGO law introduced in 2017 call on the government to “stop the insult of the nation”. IMAGO / EST&OST

The situation with Hungary and its NGOs remains in a state of flux. Prime Minister Viktor Orbán’s government has introduced legislation, effective 1 July 2021, requiring the State Audit Office to audit all civil society organisations in Hungary with annual budgets of more than HUF 20 million (approx. 55,000 euros). The first attempt to introduce a so-called Transparency Law on NGOs goes back to 2017. Under that legislation, all NGOs were required to register with the courts as organisations in receipt of support from abroad once their annual foreign funding exceeded HUF 7.2 million (just over 20,500 euros). The Hungarian government finally repealed the law in April 2021 following the launch of an infringement procedure by the European Commission in July 2017 and then a ruling by the Court of Justice of the European Union in June 2020. The Hungarian government initially ignored the judgment, which held that the law was discriminatory, until the European Commission moved to initiate further proceedings against Hungary in February this year.

According to official statements, the Transparency Law from 2017 was intended to combat money laundering. However, this argument appeared to be lacking in substance, given that civil society organisations are required to publish annual financial reports, thus safeguarding transparency. A more likely scenario is that the legislation was meant to interfere with the work of non-governmental organisations and damage their reputation. Registration of NGOs as foreign-funded amounts to stigmatisation and subjects these organisations to intense public scrutiny.

The ongoing liberal threat

The conflict between internationally funded NGOs and the government in Hungary has been simmering for some time. For Orbán, these organisations constitute a liberal threat to Hungary and are an attempt by foreign financiers, notably millionaire George Soros, to exert influence. For example, as part of the debate about migration and refugees, ongoing since 2015, rules introduced in 2018 imposed a special tax on NGOs engaged in migration- and refugee-related activities and prohibited them from operating in a designated corridor along the Hungarian border. The intention was to prevent refugees from being provided with basic necessities – food, water and clothing – and gaining access to advice on asylum.

A poster campaign was also launched to make it clear to war refugees (or the few migrants who made it to Hungary along the Balkan route) that they were not welcome. However, the posters were written entirely in Hungarian, suggesting that a further target of the campaign was the public at home. The posters portrayed George Soros and the then European Commission President Jean-Claude Juncker in a derogatory manner and invoked the “foreigners” and “evil-doers” narrative, with slogans such as “You have the right to know what Brussels is planning to do”. Drawing on conspiracy theories involving the EU and Soros and targeted against Hungary, the underlying message was that Soros and Juncker were allegedly working together to give refugees and migrants a pathway into the EU. The fact that Viktor Orbán himself once benefited from a scholarship from George Soros was never mentioned.

Organisations that provide assistance to refugees are not covered by the new law, due to enter into force in July. The 2018 regulations remain in place, precluding the provision of appropriate care for refugees and migrants. This constitutes a continuing breach of EU standards in the field of human rights.

In 2018, Orbán also announced that there would need to be some changes in Hungary’s cultural and academic spheres, mainly to rein in liberalism. This campaign impacted theatres and the universities – notably Central European University, which relocated to a campus in Vienna – as well as organisations that campaign for gay rights.

The new legislation regulating NGOs links in, to no lesser extent, with this narrative of the liberal threat: non-profit organisations such as sports clubs and associations of national minorities, i.e. the ethnic minorities that are officially recognised in Hungary, are exempt from the legislation, as are religious groups. In other words, the law does not apply to organisations that represent national/Hungarian values and do not involve themselves in politics. All other organisations, specifically those which campaign for democracy and the rule of law, must expect to be inspected by the State Audit Office once a year. This is problematical in itself: the Audit Office’s remit is to monitor the use of public funds, whereas these organisations receive no funding from the public purse. The organisations mainly affected are those which advocate for human rights and minorities such as migrants or LGBTQI people. The government’s treatment of non-governmental organisation reflects an ongoing trend, targeted against one of the hallmarks of democracy. NGOs are an important means for the representation of the public’s interests. Linking in with this, on 15 June 2021, the Hungarian National Assembly passed legislation which prohibits the promotion and sharing of content portraying homosexuality, transsexuality and transgenderism to persons under the age of 18. This fosters the image of a homogeneous society which, in reality, does not exist.

The EU is seemingly impotent

The 2017 NGO legislation was indeed repealed by the Hungarian government. However, this was a response to the Commission’s infringement procedure and the financial penalties threatened by the EU, rather than being a mark of respect for the EU and its institutions. The new legislation on NGO registration, which is about to enter into force, appears to comply with the EU’s formal criteria. Overall, however, it cannot be assumed that this legislation will result in less discrimination against NGOs, given that the main focus now is on NGOs with a substantial annual income. The EU therefore has few means at its disposal to counter Orbán’s restrictive policies and his campaign against liberalism and the organisations that he believes support it. Indeed, Orbán sidestepped the possible suspension of the Hungarian ruling party Fidesz from membership of the European People’s Party (EPP) in the European Parliament by withdrawing all these MEPs from the group.

The EU must continue to stand with Hungary’s non-governmental organisations and minorities and be more vocal in its criticism of the Hungarian government’s approach. NGOs are an important part of the fabric of democratic societies and processes and should therefore be able to perform their work – including in Hungary – without being marginalised by government regulations.

Melanie Hien is a PhD candidate in Political Sciences at the University of Regensburg, working on civil society and the political regime in the context of transformation in Hungary.