In the summer of 2025, the Hungarian Parliament adopted the Act on the “Protection of Local Identity”. It enables municipalities to restrict the acquisition of property by people without local ties by establishing right of first refusal, and to limit settlement by requiring the payment of a “settlement contribution” and/or by prohibiting or conditioning the establishment of a local residence. Sales contracts concluded in violation of such decrees are null and void, and people settling in violation of a decree may be fined.
By early December 2025, as many as 180 municipalities had adopted such decrees under the Act, imposing requirements on newcomers seeking to establish a residence. Such requirements include a clean criminal record, employment relationship, social security coverage, regular income, educational qualifications, no outstanding public debts, proof of children’s attendance at schools, as well as conditions relating to minimum dwelling size/per capita living space or requirements relating to the “settlement contribution.” Although these requirements appear neutral, in reality, they disproportionately disadvantage poor people and people of Roma origin, and therefore amount to severe discrimination.
The Act and the municipality decrees also violate EU law, as they restrict the free movement of people and capital within the European Union and infringe the rule-of-law principles of legal certainty, foreseeability, and the prohibition of arbitrariness. For these reasons, we have submitted a complaint with the European Commission requesting it to examine the Act and the municipality decrees adopted under it, and to launch an infringement procedure, so that unlawful decrees not limit people’s freedom to choose where they want to live.