Useful tips for opening a business in Hungary

Hungary is one of the few EU countries that provides a number of benefits to foreigners aiming to start a business there.

Investors from other countries help fuel growth of the domestic economy, which is why they are treated with the utmost respect and given all kinds of support from the state. Thanks to that, there has been some significant economic development in Hungary over the past few years. Effective reforms implemented in the early 2000s resulted in the dramatic improvement of the country’s business legislation. You can make sure of that by ordering online paper editing services — their prices are one of the lowest on the EU market.

 Hungary is situated in the heart of Eastern Europe.

So, if you want to have easy access to European markets, use a simplified system of taxation and avoid excessive paperwork, this country is your number one choice.

Of course, you can face some initial difficulties if you do not speak the language and have no idea about the local traditions, but they are easy to overcome.

Organisational and Legal Forms of Enterprises in Hungary

Registering a company in Hungary is now easier than ever. To be able to do business in this country, foreign entrepreneurs can apply for several types of ownership. Let’s have a look at the most popular ones.

Limited Liability Companies

A limited liability company (Kft) is the most popular type of enterprise among foreign businesspeople. It can be registered by one or several individuals or legal entities, and they do not even have to be residents of Hungary. There can be only one CEO, while a supervisory board may consist of up to 15 persons. The number of contributions limits the founders’ financial responsibility.

The minimum authorised capital of a closed-end company is three million forints (about $ 10,000).

You can pay 50% of the share capital upon registration, while the rest must be paid within a year. An open joint-stock company (Rt) with limited liability is permitted to sell its stocks openly. The minimum share capital is 20 million Hungarian forints (about $70,000). At the time of registration, such a company must have only 25% of the required amount in its bank account.

Partnership

A partnership can have both limited and unlimited liability forms. Whichever you choose, the share capital, as well as the number of partners, can be unlimited. Founders can be individuals or legal entities, as well as citizens or non-citizens of Hungary.

An unlimited liability partnership (Kkv) means that all members have the same rights and unlimited liability for debts. In a limited liability partnership (Bt), all participants are divided into two types — those who assume full responsibility and those whose responsibility is limited by the amount of their contribution. Participants with full responsibility perform managerial functions.

Purchasing a Business

You can start making money immediately by buying a company.

In Hungary, various commercial entities are regularly put up for sale. It is a good option for those business people who do not want to waste their time and effort on registering a new enterprise. However, you should order an audit of such a company because it may no longer be profitable. You should not fall for that trick.

Company Registry

Setting up a business in Hungary may take you at least a week. According to the Hungarian legislation, only licensed lawyers can help you with registering an enterprise of any type. The lawyer’s fee may vary, but typically it is no more than 100,000 Hungarian forints (about $350). Also, when registering a company, you will have to pay a state duty of about 50,000 forints and a registration fee of about 5,000 forints ( $175 and $17.5, respectively).