Open a Representative Office in Hungary

Open a Representative Office in Hungary

Updated on Monday 13th March 2017

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A businessman may not choose to establish an actual company. Some businessmen, specially foreign investors, choose to open a representative office in Hungary instead. Representative offices are organizational entities of foreign companies that have no separate legal identity of their own. As such, they may not engage into activities that generate profit or any other form of income. Hungarian law allows such entities to be established in the country. The main law that governs representative or liaison offices is the Branch Act. Our Hungarian law firm can help you get started on your representative office in the country.

Registration of representative office in Hungary

Although representative offices are not allowed to engage in commercial activities, they must still be registered. Registration of representative offices in Hungary can be done with the Court of Registration where the office is located. There is no minimum share capital requirement for creating a representative office but a registration fee of 50,000 Hungarian Forint has to be paid. After all requirements and fees have been complied with, the Court of Registration enters the application in its records. Representative offices can only start business operations after registration. Our attorneys in Hungary are can help you with the registration process.

Limited activities of Hungarian representative offices

Representative offices in Hungary can only conduct certain activities. These are some that are listed by our Hungarian lawyers:
1. Mediation of contracts between its foreign principal company and Hungarian business entities and private individuals;
2. Preparation of contracts that have been entered into by its foreign principal and Hungarian companies;
3. Information drives and promotional activities of goods, services, and rights sold or provided by its foreign principal;
4. Represent its foreign principal company during exhibits, fairs, professional lectures, and other identical events done in Hungary.

Ownership of real estate in Hungary for your representative office

Foreign companies may purchase real estate for the establishment of representative offices in Hungary. If the foreign company is registered in a country that is a member of the European Union or the European Economic Area, it may acquire property as long as it is not considered as agricultural land. For foreign companies that are neither registered with the European Union, nor the European Economic Area, they may still purchase real property as long as it is not tagged as agricultural land or natural preservation area. Our law firm in Hungary can help you determine if you are qualified to acquire real estate in the country.
There can be a lot of legal implications when you set up a representative office. Our Hungarian lawyers can definitely help you establish this type of business form. Contact us now for a cutomized offer.