June and July 2026 – Constitutional and personnel changes plus the new anti-corruption agency

Although June and July saw enough radical regulatory and legal developments to fill several years, including the 16^th and 17^th Amendment of the Constitution, the government’s promises and public expectations following its landslide April victory suggest that this period may have been only the calm before the storm.

 

Key takeaways of June and July

• The new government has shown a willingness to take difficult and controversial decisions in pursuit of its agenda of political elite renewal and uncompromising anti-corruption measures. Notable examples include the removal of key officeholders, including the President of Hungary, the President of the Constitutional Court. The Chief Public Prosecutor resigned. Further similar changes will most likely occur soon.
• The review of several high-profile, long-term contracts and permits entered into or granted by the State under previous governments has already begun. Relevant sectors include finance, tobacco wholesale and retail, land-based casinos, State-supported private equity fund structures and, through a retrospective review of environmental permits, battery manufacturing, among others.
• These steps appear to be the start of a much broader due diligence review of past government business decisions. To support this process, a new public prosecution agency has been established with unusually broad powers, while parliamentary committees have also been significantly strengthened. Together, these measures are likely to disrupt several core business sectors in Hungary, while potentially improving prospects for independent Hungarian and foreign investors.
• The government has actively recruited experienced sector-specific specialists from the private sector and academia, often with international backgrounds, for senior roles in ministries, State-owned companies and public authorities. This trend is expected to continue.
• At the same time, the government has reached an agreement with the European Commission to release EUR 16.4 billion in EU funding, equivalent to approximately 7% of GDP or 13% of the annual public budget, in the form of subsidies and loans. The funds are expected to be used for public transport, railways, energy infrastructure, education, healthcare and support for small and medium-sized enterprises.

1. Constitutional Changes

A number of constitutional changes have been introduced:

1. A term limit for the Prime Minister: individuals who have served a total of at least eight years in office are no longer eligible for re-election. Other than limiting the current potential candidate in the future, this measure also precludes the previous Prime Minister from holding the office again.
2. The President of Hungary was removed from office by means of a constitutional amendment through the following provision: "The mandate of the incumbent President of the Republic shall terminate on the day following the entry into force of the Seventeenth Amendment to the Fundamental Law.".

• A term limitation on Members of Parliament: a person is not eligible for election as a Member of Parliament if (s)he has already served as a Member of Parliament for an aggregate period of at least twelve years, or has been elected as a Member of Parliament on at least three occasions. Other than limitation for the future, this measure also precludes most MPs of the previous political regimes to continue their careers as MPs after 2030. The previous government(s) have been in place through four consecutive general elections.

2025: Changes at the Constitutional Court: a constitutional court judge’s mandate automatically terminates when they reach the age of seventy. As a result, four of the current fifteen judges, including the President of the Constitutional Court, will leave office. The President was appointed by the previous Parliament only a year ago and previously served two terms as Chief Public Prosecutor of Hungary, from 2000 to 2006 and from 2010 to 2025. Constitutional judges will no longer be eligible for re-election, and their term of office will be reduced from twelve to nine years. The President of the Constitutional Court will also be elected by the constitutional judges themselves, rather than by Parliament.

2026: Leaders of the Judiciary: the terms of office of the President of the National Office for the Judiciary and the President of the Supreme Court will be reduced from nine to six years and will no longer be renewable. Judges will also be granted a role in the nomination and removal of these officeholders. The current president of the Supreme Court, critizied by many inside and outside of the judiciary, has been in office since January 2021.

2027: Termination of public trust foundations (in Hungarian: közfeladatot ellátó közérdekű vagyonkezelő alapítványok), introduced by the previous government with very heavy public fundings. E.g. one of the funds received from the State shares in Hungarian companies worth cca. EUR 1 billion. The political significance of these funds is demonstrated by the fact that they have been introduced into the Constitution of Hungary by the previous Parliament, that is the reason why their termination had to be taken place by means of another constitutional amendment. Public trust foundations have been heavily criticised by many, including the European Commission due to lack of transparency and personal overlaps.

2. National Asset Recovery and Asset Protection Office – a new anti-corruption institution

The Parliament established the National Asset Recovery and Asset Protection Office (the 'Office') as a new autonomous public body responsible for identifying, protecting and recovering assets that may have unlawfully left the public-asset sphere, as well as examining the management of public assets. Its mandate is not limited to classic corruption cases. It expressly reaches value flows linked to public procurement, subsidies, concessions, public-service financing, EU funds, State and municipal companies, public foundations, State and municipal assets, contractual chains, payment flows and beneficial ownership structures.

The Office is vested with wide-ranging powers, which make it one of the most powerful anti-corruption 'super-authorities' in Europe. The Office may carry out public-asset risk assessments and investigations, place matters under public-asset supervision, bring legal actions, initiate the procedures of other authorities and exercise powers connected to administrative, court and criminal proceedings. In defined cases, it may also act within the criminal-procedure framework, including investigative and prosecutorial functions.

The Office may request data, documents and information, conduct inspections and make copies of records, obtain statements and explanations, carry out on-site inspections, extract or copy electronic records and data, seek information from other authorities, access public registers, and engage external experts or advisers.

The Office is expected to commence its substantive operations in autumn 2026. The office, together with strong anti-corruption actions, was one of the main political agenda points of the ruling party during the election campaign and receives very strong political and public support.

The Office will also review and explore major transactions that have shaped the market structure, competitive landscape and allocation of assets within entire sectors of the economy with direct or indirect state interests in the past with strong government and public support as well as high expectations in successfully recovering state funds and assets negligently handled under the previous government.

Since state interventions and participation have been very strong in Hungary in the last fifteen years, the outcome of the Office's proceedings might be reshaping entire business sectors and so cause market realignments in the affected sectors.

Investigations can be expected in any sector in which market participants have historically relied to a significant extent on public subsidies (direct or indirect) or public procurement contracts. 

3. Personnel changes

a. National leadership

In addition to the personnel changes resulting from the constitutional amendments described above — affecting the President of Hungary, the President and members of the Constitutional Court, and the President of the Curia — the resignation of the Chief Public Prosecutor is particularly noteworthy. He stepped down amid strong political pressure and reported internal conflicts. The prosecution service has widely been viewed as one of the key institutions associated with responsibility for systemic corruption in the country.

Another senior figure associated with the previous government, the President of the National Media and Infocommunications Authority (NMHH), was also removed from office. The NMHH is more than a media regulator: it also serves as the telecommunications authority, oversees media and radio-service matters, supervises electronic communications markets, and performs functions relating to digital services, postal services and electronic communications infrastructure, with extensive legislative and regulatory powers.

b. High ranking government officials

In recent months, the government has made progress in building its new structure at the level of state secretaries and deputy state secretaries, who are responsible for day-to-day implementation, although the process remained incomplete at the end of July. The appointments made so far indicate a preference for professionals and policy experts, particularly those with international experience. Most appointees have come from the private sector, with only a small number having formal ties to the ruling party.

Background of state secretaries include, MVM, OTP Bank, Henkell, Boston Consulting, CEU, Deloitte, NATO, the Municipality of Budapest as well as some officials serving in the public administration in the early 2010's.