How to Notify a Merger in Hungary: Step-by-step GVH Merger Notification Procedure

Any buyer, seller or joint-venture partner whose transaction meets Hungarian turnover thresholds must notify the concentration to the Gazdasági Versenyhivatal (GVH, the Hungarian Competition Authority) before implementation. Understanding how to notify a merger in Hungary is essential because the country operates a mandatory, suspensory regime: closing without clearance is unlawful and carries substantial fines. This guide sets out every stage of the merger control process under Act LVII of 1996 on the Prohibition of Unfair Market Practices and Restriction of Competition (the “Competition Act”), from threshold screening through to final decision, with the document checklists, timelines and fee tables that general counsel and deal teams need in practice.

The procedure has been shaped by rule changes introduced in 2023–2024 that altered filing fees, adjusted thresholds, and confirmed that parties may file once a binding agreement exists, all of which remain in effect.

Overview of the Merger Control Process and Who It Applies To

Hungarian merger control applies to “concentrations” as defined in the Competition Act. A concentration arises where two or more previously independent undertakings merge, where one undertaking acquires direct or indirect control over another, or where a full-function joint venture is created. The statutory basis is Part V of the Competition Act, which mirrors core concepts of Council Regulation (EC) No 139/2004 (the EU Merger Regulation) but applies at the national level when the transaction does not have an EU dimension.

Where the EU Merger Regulation thresholds are met, the European Commission has exclusive jurisdiction and no separate GVH filing is required (unless the Commission refers the case back under Article 9). For all other transactions meeting Hungarian thresholds, a GVH filing is mandatory. The notification obligation rests on the acquirer in an acquisition, or on all merging parties jointly in a merger or joint-venture scenario.

Hungary’s system is suspensory: the parties must not implement the concentration, by transferring shares, exercising voting rights or integrating operations, until the GVH has cleared it or the statutory review period has expired without a decision. This standstill obligation is a cornerstone of merger control in Hungary and breaching it exposes parties to fines of up to ten per cent of the undertaking’s net turnover.

Eligibility and Prerequisites: Merger Thresholds in Hungary

A notification is mandatory when both of the following turnover-based tests are satisfied:

• Combined turnover test. The aggregate net turnover generated in or from Hungary by all undertakings concerned in the preceding financial year exceeds the prescribed combined threshold set out in the Competition Act.
• Individual turnover test. At least two of the undertakings concerned each individually generated net turnover in or from Hungary above the prescribed individual threshold in the preceding financial year.

Turnover is calculated on a group-wide basis, including all undertakings that form part of the same economic unit through direct or indirect control. Where financial statements are denominated in a foreign currency, conversion must use the official rate published by the Magyar Nemzeti Bank (MNB) for the relevant financial-year end.

Foreign-to-foreign transactions

A transaction between two non-Hungarian undertakings still falls within GVH jurisdiction if their Hungarian-derived turnovers meet the statutory thresholds. The GVH applies a pure effects-based test: the nationality or seat of the parties is irrelevant. Private-equity buyers acquiring Hungarian portfolio targets through offshore holding structures should therefore screen each target’s Hungarian revenue carefully.

Voluntary notification and the supervisory trigger

Below the mandatory thresholds, the Competition Act provides for a voluntary notification option where the concentration nevertheless raises competition concerns. Where turnover exceeds the lower supervisory trigger, currently set at HUF 5 billion combined net turnover, the GVH retains the power to examine a completed concentration ex officio. Voluntary notification avoids the risk of a retrospective investigation but does not create a standstill obligation.

How to Notify a Merger in Hungary: Step-by-Step Procedure

The table below summarises the full merger notification procedure from pre-deal screening to clearance. Each step is then explained in detail.

Step 1, Screen the transaction and check thresholds

Before any external filing, the buyer’s and seller’s legal and finance teams should collect group-wide net-turnover data for the most recent audited financial year and apply the mandatory threshold tests set out in the Competition Act. This screening should also determine whether the transaction has an EU dimension under the EU Merger Regulation, which would divert the filing to the European Commission. If turnover falls between the voluntary and mandatory thresholds, assess whether a voluntary notification is prudent given the GVH’s supervisory powers. Allocate one to three days for this internal exercise.

Step 2, Consider pre-notification contact with the GVH

The GVH encourages parties to engage in informal pre-notification discussions before submitting a formal filing. Pre-notification contact allows counsel to clarify the expected scope of the review, discuss market-definition issues, and confirm which version of the notification form, normal or simplified, is appropriate. Early engagement is especially valuable in cases involving complex market overlaps, vertical relationships, or foreign-to-foreign transactions where jurisdiction is borderline.

To make the most of a pre-notification meeting, prepare a draft notification form, preliminary market-share estimates, and organisational charts. Schedule the meeting at least two to ten business days before the intended filing date. The GVH typically responds within one to seven business days with substantive feedback, which can significantly reduce the risk of requests for further information after filing and thereby shorten the overall review timeline.

Step 3, Prepare and submit the GVH notification form

The formal GVH filing is made electronically. The notifying party, typically the acquirer, or all parties jointly in a merger or joint venture, completes the prescribed notification form. The GVH publishes a template that sets out the required fields, including identification of the parties, description of the concentration, market definitions, turnover data, and competitive-impact analysis. Two form variants exist:

• Normal (detailed) form. Required for transactions where horizontal overlaps or vertical relationships exist, or where the combined market share on any affected market exceeds a de minimis level.
• Simplified form. Available where none of the parties’ activities overlap horizontally, no vertical relationship exists, and combined market shares on all plausible markets remain below the thresholds specified by the GVH.

The completed form must be accompanied by all supporting documents (see the Required Documents section below), a signed authorisation for the filing representative, and proof of payment of the applicable filing fee. The filing date, “Day 0” for timeline purposes, is the date on which the GVH receives a complete notification. An incomplete submission will be returned with a request for supplementation, and the clock does not start until the deficiencies are cured.

Parties may file once they have a binding agreement, for example, an executed share-purchase agreement or a binding letter of intent with all material terms agreed. It is not necessary to wait until all conditions precedent (other than merger-control clearance) are satisfied. This practical rule, confirmed in GVH practice and consistent with the 2023 procedural updates, means that the filing can run in parallel with other regulatory approvals.

Step 4, GVH initial check and fast-track (8-day) clearance

Upon receipt of a complete notification, the GVH conducts an initial assessment. If the concentration manifestly does not raise competition concerns, for example, there is no horizontal overlap and no significant vertical relationship in Hungary, the GVH may issue a clearance acknowledgement within 8 calendar days. This fast-track route is the quickest way to obtain merger control clearance in Hungary and applies to a substantial proportion of notified transactions.

If the GVH determines during its initial check that further analysis is needed, it will open a formal competition-supervision proceeding (Phase I). At this point, the GVH may also issue information requests to the parties, competitors, customers and suppliers. The fast-track clearance carries a lower filing fee than a full Phase I or Phase II proceeding, making it cost-effective for straightforward transactions. Whether a case qualifies for fast-track treatment is ultimately a matter for the GVH’s discretion, and pre-notification contact is the most reliable way to gauge eligibility.

Step 5, Phase I review and potential escalation to Phase II

Where the GVH opens a formal competition-supervision proceeding, the Phase I review typically runs for up to 30 days from the date of the complete notification. During Phase I, the GVH examines market definitions, competitive overlaps, vertical effects and any conglomerate concerns. It may request additional information from the parties; if it does, the review clock is typically suspended until the parties respond (“stop-the-clock” mechanism).

If the Phase I review reveals that the concentration may significantly impede effective competition, particularly through the creation or strengthening of a dominant position, the GVH will escalate the case to a Phase II in-depth investigation. Phase II can last up to 120 days and may be extended for just cause. During Phase II, the GVH may hold oral hearings, commission economic analyses, consult sector regulators, and invite observations from third parties. The parties have the opportunity to propose remedies, typically divestitures or behavioural commitments, to address the GVH’s concerns and secure conditional clearance.

Step 6, Decision, remedies and clearance mechanics

At the conclusion of either Phase I or Phase II, the GVH issues one of three decisions:

• Unconditional clearance. The concentration may proceed without restrictions.
• Conditional clearance. The concentration is approved subject to conditions and obligations (e.g., divestiture of a business unit, supply commitments, or behavioural restrictions).
• Prohibition. The concentration may not be implemented. Prohibition decisions are rare but possible where remedies are insufficient to address identified competition concerns.

Following unconditional or conditional clearance, the parties may close the transaction and begin integration. The GVH decision is subject to judicial review by the Budapest Metropolitan Court and subsequently by the Kúria (Supreme Court). Implementation before clearance, or in breach of conditions, exposes parties to fines and potential unwinding of the transaction under the Competition Act.

Merger Notification Requirements: Required Documents and Information

The documents needed for a merger notification in Hungary are set out in the GVH’s notification template and the Competition Act. The table below provides an annotated checklist.

Practical tips for document preparation

Turnover calculations should follow the methodology in the Competition Act, aggregating revenues on a group-wide basis and excluding intra-group sales. Use audited figures for the most recent completed financial year. Where the undertaking’s financial year does not align with the calendar year, provide a clear explanatory note. Ensure that all financial data is converted to Hungarian Forints at the MNB rate applicable to the last day of the relevant financial year.

Prepare a cover letter summarising: the parties, the nature of the concentration, the applicable thresholds, and the form used (normal or simplified). A well-structured cover letter helps the GVH case team to process the notification efficiently and reduces the likelihood of a completeness deficiency that would delay Day 0.

Review Timeline and Key Deadlines for Merger Control in Hungary

The review timeline for a GVH merger notification depends on the complexity of the transaction and the review track it enters.

Filing triggers and standstill

Parties should file at the earliest practical date after the information required to complete the GVH form is available. In practice, this means filing promptly after signing a binding agreement. The standstill obligation prohibits implementation, including share transfers, exercise of voting rights, and operational integration, until clearance is obtained. The standstill applies only to mandatory notifications; voluntary filings do not create a standstill obligation, though implementation during a voluntary review carries reputational and enforcement risk if the GVH later objects.

The GVH also retains supervisory jurisdiction to examine completed concentrations ex officio where the voluntary-notification threshold is met but no filing was made. Early indications suggest the GVH has become more active in exercising this power in recent years, making proactive voluntary notification advisable in borderline cases.

Costs, Fees, and Tax Considerations for a GVH Filing

Filing fees for a Hungarian merger notification are set by regulation and increase if the proceeding escalates. The table below provides indicative figures based on industry reporting; parties should confirm the current fee schedule with the GVH before payment, as fees have been adjusted in recent years.

From a tax perspective, mergers and demergers carried out under the Hungarian Civil Code are generally treated as tax-neutral events under Hungarian tax law. However, cross-border restructurings and acquisitions may trigger transfer-pricing, withholding-tax or capital-gains-tax consequences. Deal teams should engage specialist tax counsel alongside the merger-control workstream.

What Changed in 2023–2026: Practical Impact on How to Notify a Merger in Hungary

Several procedural and substantive changes introduced since 2022 continue to shape how parties approach GVH filings:

• Filing trigger confirmed. The GVH confirmed that parties may file once they have a binding agreement (e.g., an executed share-purchase agreement). It is not necessary to wait until all conditions precedent are fulfilled. This allows the merger-control review to run in parallel with other regulatory approvals and due-diligence workstreams, shortening overall deal timelines.
• Fee adjustments. Filing fees were increased in line with government fee regulations introduced since 2023. The escalation structure, from fast-track through Phase I to Phase II, creates a significant cost differential that incentivises complete, well-prepared notifications that qualify for fast-track clearance.
• Threshold updates. Turnover thresholds have been periodically adjusted. Parties should always verify the current mandatory and voluntary thresholds with the GVH or in the latest consolidated text of the Competition Act before initiating threshold screening.
• Increased supervisory activity. Industry observers expect the GVH to continue exercising its ex-officio supervisory power more frequently, particularly in digital and technology markets where traditional turnover thresholds may not capture transactions involving high-value, low-revenue targets.

The likely practical effect of these changes is that deal teams must build merger-control filing into the transaction timeline from the term-sheet stage, rather than treating it as a post-signing administrative step.

Common Pitfalls in Hungarian Merger Notifications and How to Avoid Them

• Implementing before clearance (standstill breach). Gun-jumping, including exercising voting rights, appointing directors, or integrating commercial operations before GVH clearance, is the most serious risk. Ensure the SPA contains a hold-separate clause and that integration planning remains strictly ring-fenced until clearance is received.
• Inconsistent or incomplete turnover tables. Presenting financial data from different financial-year periods, omitting group entities, or using incorrect exchange rates is a common cause of GVH information requests that delay Day 0. Use a standardised turnover template, apply MNB rates consistently, and reconcile figures to audited statements before filing.
• Failing to identify all relevant group undertakings. The Competition Act requires turnover to be calculated on a group-wide basis. Omitting minority-controlled subsidiaries, joint ventures, or funds under common management can result in an under-statement of turnover that either misses a threshold or triggers a GVH inquiry. Map the full group structure before screening thresholds.
• Underestimating remedy complexity. Where Phase II is likely, parties sometimes delay remedy discussions until the GVH identifies concerns. Early preparation of divestiture options, behavioural commitments and customer-notification plans can materially shorten the Phase II timeline and improve the prospect of conditional clearance.
• Skipping pre-notification contact. Parties that file without prior engagement with the GVH are more likely to receive completeness deficiency notices, which push back Day 0 and delay the entire process. Pre-notification contact is not mandatory but is strongly recommended, especially for foreign-to-foreign transactions and cases with complex market definitions.

Sources

1. Hungarian Competition Authority (GVH), “I will buy an undertaking” merger guidance
2. GVH, Merger notification template (ICN template hosted by GVH)
3. Act LVII of 1996 on the Prohibition of Unfair Market Practices and Restriction of Competition (Competition Act), GVH copy
4. EUR-Lex, Council Regulation (EC) No 139/2004 (EU Merger Regulation)
5. International Competition Network (ICN), Merger notification template: Hungary