HUN-1998-2-007

a) Hungary / b) Constitutional Court / c)  / d) 25-06-1998 / e) 30/1998 / f)  / g) Magyar Közlöny (Official Gazette), 55/1998 / h) CODICES (German).

Keywords of the Systematic Thesaurus:

01.06.02

Constitutional Justice - Effects - Determination of effects by the court.

01.06.05.05

Constitutional Justice - Effects - Temporal effect - Postponement of temporal effect.

02.01.01.03

Sources - Categories - Written rules - Law of the European Union/EU Law.

02.02.01.06.04

Sources - Hierarchy - Hierarchy as between national and non-national sources - Law of the European Union/EU Law and domestic law - EU secondary law and domestic nonconstitutional instruments.

02.02.01.06.05

Sources - Hierarchy - Hierarchy as between national and non-national sources - Law of the European Union/EU Law and domestic law - Direct effect, primacy and the uniform application of EU Law.

03.01

General Principles - Sovereignty.

Keywords of the alphabetical index:

Community law, competition / EU, Association agreement.

Headnotes:

When implementing competition and other economic provisions of Law I of 1994 on the Promulgation of the Europe Agreement with Hungary, it is a constitutional requirement that Hungarian authorities which apply the law must not apply directly the criteria required by Article 62 of this Agreement. On the basis of this, the Governmental Decree promulgating a decision of the Association Council, according to which the Hungarian Competition Council shall apply Community law concerning competition, is unconstitutional. However the Court did not annul these provisions but suspended a decision on the annulment until 30 December 1999.

Summary:

In the instant case, the Court had to examine in what way the criteria and principles established by the Community concerning the prohibition of restraint of trade can be realised in the Hungarian legal system. In particular, it had to consider whether the Hungarian Competition Council could directly apply the internal norms of another international legal entity or another independent legal system, like community law, without incorporating these international legal norms into the Hungarian legal system. The Court emphasised that the challenged criteria of the Europe Agreement are prevailing for the domestic Competitive Council and should be taken into consideration when the Council decides concrete cases according to the Governmental Decree in question. The Court also held that direct applicability is a special characteristic of the connection between the Community and its member States, and Hungary is not yet a member State.

According to the reasoning of the Court, the affected legal relations are linked with State sovereignty: legal regulations on restraint of trade fall within the exclusive sovereignty of the State. Without an explicit constitutional authorisation, the Parliament does not have the constitutional right to go beyond the principle of territorial right in an international treaty concerning a branch of law which falls exclusively within State sovereignty. From the point of view of constitutionality, it does not matter that in this case Parliament only went beyond the principle of the territorial right in a narrow field, the field of competition law. The decision pointed out that international treaties shall be promulgated by law in order for them to be binding on everyone in Hungary. The relevant statute however just refers to the criteria determined by the Community law without these appearing even in an international treaty or in the law promulgating the treaty. The challenged provisions of the Governmental Decree promulgating the decision of the Association Council in question are unconstitutional, since they were not made by the legitimate public authority determined by the Hungarian Constitution as the source of those criteria which the Hungarian Competition Council is bound to take into account. These provisions are unconstitutional also because according to these, it is the obligation of the Hungarian Competition Council to apply directly the future norms of public law.

The Constitutional Court suspended decision on the annulment of the unconstitutional provisions until 30 December 1999 so that the legislator would have enough time to harmonise the legal provisions as required by the Constitution.

Cross-references:

Decision no. 4 of 1997 (I. 22.), Bulletin 1997/1 [HUN-1997-1-001].

Languages:

Hungarian.