eSignature Legality in Hungary

eSignature Legality Summary

Under Hungarian law, a written signature is not necessarily required for a valid contract - contracts are generally valid if legally competent parties reach an agreement, whether they agree verbally, electronically or in a physical paper document (Section 6:63 of the Hungarian Civil Code). To prove a valid contract, parties sometimes have to present evidence in court. Leading digital transaction management solutions can provide electronic records that are admissible in evidence under Hungarian’s Civil Code to support the existence, authenticity and valid acceptance of a contract.

In addition, Regulation (EU) No 910/2014 on electronic identification and trust services for electronic transactions in the internal market (the “eIDAS Regulation”) came into force on 1 July 2016. The eIDAS Regulation repealed and replaced the e-Signatures Directive (1999/93/EC) and is directly applicable in the 28 member countries of the European Union.

The eIDAS Regulation is technology neutral and defines three types of electronic signature (SES, AES, QES). Article 25(1) provides that an electronic signature shall not be denied legal effect and admissibility as evidence in legal proceedings solely on the grounds that it is in an electronic form or does not meet the requirements of a QES. Articles 25(2) and (3) give a QES the same legal effect as a handwritten signature and ensure that a QES recognized in one Member State of the EU is also recognized in other Member States. Finally, Recital 49 allows national law to set requirements regarding which type of electronic signature may be required in which circumstances.

Use Cases for Standard Electronic Signature (SES)

Use cases where an SES is typically appropriate include:

• certain HR documents, such as non-disclosure agreements, privacy notices, benefits paperwork and other new employee onboarding processes, except employment agreements and termination notices;

• commercial agreements between corporate entities, including non-disclosure agreements, purchase orders, order acknowledgements, other procurement documents, sales agreements, distribution agreements, service agreements (except data processing agreements)

• consumer agreements, including new retail account opening documents, sales terms, services terms, software licenses, purchase orders, order confirmations, shipment documentation, user manuals, policies

• software license agreements for software obtained in the course of commercial distribution

• licenses of patents and trademarks

• intangible property transfers, including patent and trademark transfers (except collective and certification trademark assignments)

Use Cases for Other Types of Electronic Signature (e.g. Digital Signature, AES

Use cases where an electronic signature other than SES may be required include:

• AES, QES, or advanced electronic seal + qualified electronic time stamp - an agreement changing the limitation period (Section 6:22(3) of the Civil Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - revocation of a contractual offer made in writing (Section 6:65(3) of the Civil Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - power of Attorney granted by management to the employees of a legal person (Section 3:30(3) of the Civil Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - notice of termination of membership in an association (Section 3:68(2) of the Civil Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - resolution for the exclusion of a member of an association (Section 3:70(2) of the Civil Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - legal statements, decisions and communication of resolutions pertaining to a company (3:91(1) of the Civil Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - decisions by the founder in a single-member company (Section 3:109 (4) of the Civil Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - termination of membership in a general partnership (Section 3:147 (1)-(2) of the Civil Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - transfer of partnership shares in a general partnership (Section 3:148 (1) of the Civil Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - transfer of business shares of a limited company (Section 3:168 (1) of the Civil Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - objections against the holding of a general meeting of a stock corporation by conference call (Section 3:280 (3) of the Civil Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - requesting shares in place of bonds by the bond holder of a stock corporation (Section 3:305(1) of the Civil Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - contract between a single-member limited company and its sole member (Section 3:323(4) of the Civil Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - legal acts pertaining to the cooperative society (3:328(1) of the Civil Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - contract of assignment / transfer of interests in a cooperative society (3:332(4) of the Civil Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - withdrawal from the cooperative society addressed to the administrative body (Section 3:359 of the Civil Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - conclusion of pledge agreements (Section 5:89(6) of the Civil Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - arranging collateral security on dematerialized securities and payment account balances (5:95(2) of the Civil Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - appointment of a lien holder’s agent (Section 5:96(1) of the Civil Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - contracts on the transfer of the seceded lien (Section 5:100 (2) of the Civil Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - agreement on the sales method of the pledged object in a consumer pledge agreement (Section 5:128 of the Civil Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - waiver of a beneficial interest on real property or any right registered in the real estate register or in another public register (Section 5:154 of the Civil Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - legal declaration extinguishing an easement (Section 5:163(4) of the Civil Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - stipulation of a contractual penalty (Section 6:186(2) of the Civil Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - stipulation of a forfeiture clause (Section 6:190(1) of the Civil Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - notification of assignment of a debt to the debtor (6:197(1) of the Civil Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - contracts for the purchase of real property (Section 6:215(2) of the Civil Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - agreement on the retention of title (Section 6:216 (2) of the Civil Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - contracts relating to preemption rights, repurchase rights, purchase options and sell options (Section 6:226(1) of the Civil Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - contract of gift of a real property (Section 6:235 (1) of the Civil Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - agreement containing a restriction imposed upon the agent in connection with exercising economic activities after the contract’s termination (Section 6:301 of the Civil Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - fiduciary asset management contracts (Section 6:310(2) of the Civil Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - leasehold contracts (Section 6:349 (2) of the Civil Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - contracts of suretyship (Section 6:416 (3) of the Civil Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - contract establishing and the statement of a guarantee (Section 6:431 (2) of the Civil Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - request for payment addressed to the guarantor (Section 6:435 (1) of the Civil Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - notice of termination of an insurance agreement (Section 6:466 (1) of the Civil Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - designation of a beneficiary in a life insurance policy (Section 6:478 (2) of the Civil Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - conclusion of a maintenance (support) agreement (Section 6:491(2) of the Civil Code)

• AES, QES, handwritten or advanced electronic seal + qualified electronic time stamp - transfer of securities made out in the form of printed certificates (Section 6:569 of the Civil Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - residential and commercial lease agreements and legal declarations (such as termination notices, warning letters, lease exchange contracts, sub-lease agreements) relating to residential and commercial lease (Section 2 (5),Section 33 (2) and Section 36 (1) of the Act LXXVIII of 1993 on Residential and Commercial Leases)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - conclusion of financial services agreements and auxiliary financial services agreements (Section 279 (1) of the Act CCXXXVII of 2013 on Credit Institutions and Financial Enterprises)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - legal statement on the rights relating to the restriction of personal rights of an employee (Section 9(3) of the Act I of 2012 on the Labor Code; “Labor Code”)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - power of Attorney granted by an employee to an authorized representative (Section 21(1) of the Labor Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - legal acts made by the employer if the employee requests a that those be presented in written form (Section 22(1) of the Labor Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - notification of the other party regarding the execution of a legal statement for contestation (Section 28(8) of the Labor Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - agreement on the rights and obligations of the parties arising from employment where the written form is required under employment regulations (Section 43(4) of the Labor Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - employment contracts (Section 44 of the Labor Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - measure imposing detrimental legal consequences in the event of any infringement of obligations arising from an employment relationship (Section 56(5) of the Labor Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - response of the employer to an employee’s proposal for the amendment of his/her employment contract (Section 61(2) of the Labor Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - agreement concluded in the course of negotiations between the employer and the works council, if a collective redundancy is planned (Section 72(5) of the Labor Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - assessment of the employee’s work (Section 81(1) of the Labor Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - permission granted by the employer to the employee to schedule his/her working time in the interest of autonomous work organization (Section 96(2) of the Labor Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - request by the employee to alter the work schedule (Section 97 (5) of the Labor Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - agreement of the parties about the extended work schedule of the employees who are working in stand-by jobs or are relatives of the employer or the owner (Section 99(3) of the Labor Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - agreement on voluntary overtime for a given calendar year (Sections 109 (2) and 135 (3) of the Labor Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - request for leave of absence without pay (Section 133(1) of the Labor Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - agreements of parties about the extended work schedule with respect to:

  • employees working as navigators, flight attendants and aviation engineers or engaged in providing ground handling services to passengers and aircraft, and participating in or providing direct support for navigation services

  • employees working in travel-intensive jobs in the domestic or international carriage of passengers and goods by road

  • carriers and traffic controllers working in a local public transportation system for the carriage of passengers or in a scheduled intercity transportation system inside a fifty-kilometer radius

  • traveling employees and traffic controllers working in the carriage of passengers by rail and in the carriage of goods by rail

  • employees working in harbors (Section 135(4) of the Labor Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - prior written consent of the employee responsible for inventory shortages for employment in the given job or workplace if an employee who is not subject to liability for inventory shortages also has access to the inventory stocks (Section 182(3) of the Labor Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - the inventory liability agreement (Section 184(1) of the Labor Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - cancelation of the inventory liability agreement effective as of the last day of the inventory period (Section 184(5) of the Labor Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - agreement of the parties concerning an employee’s provision of a guarantee to the employer if the employee’s job involves the handling of cash or other valuables received from, or provided to, third parties; or the exercise of supervision of such transactions (Section 189(1) of the Labor Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - agreement between the placement agency and the user enterprise (Section 217(1) of the Labor Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - study contracts (Section 229(3) of the Labor Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - proposal to hold a vote concerning the dismissal of a works council (Section 253(1) of the Labor Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - proposal to hold a vote concerning the dismissal of a works council member (Section 256(1) of the Labor Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - statement of consent of the works council in the case of the termination of the employment relationship of the chairman of the works council by notice, or derogation from the employment contract affecting the chairman of the works council (Section 260(3) of the Labor Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - statement of prior consent of the higher ranking trade union body in the case of the termination of the employment relationship by notice of an union official, or derogation from the employment contract affecting said union official (Section 273(1) of the Labor Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - collective agreements (Section 278 of the Labor Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - payment notice to enforce the employer’s claims from employees arising from the employment relationship (Section 285(2) of the Labor Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - executive summary of the conclusion of the conciliation process between the conciliation committee of the employer and the works council or the trade union (Section 292(1) of the Labor Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - agreement of the employer and the works council or the trade union in advance to abide by the decision of the committee (Section 293(1) of the Labor Code)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - withdrawal of an author of his/her permission for the publication of a work (Section 11 of the Act LXXVI of 1999 on Copyright; “Copyright Act”)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - the legal statements made by authors in connection with works made for hire that are created as a result of the author’s obligations within the scope of his/her employment (Section 30(6) of the Copyright Act)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - license agreements under the Copyright Act (Section 45(1) of the Copyright Act)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - notice to the collective rights management organization of the agreement made by the author and the user that the work shall be considered as a work ordered for advertising (Section 63(4) of the Copyright Act)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - the producer’s report to the author on the income arising from the use of a motion picture work relative to each means of use (Section 66(5) of the Copyright Act)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - the producer’s notification whether he will accept the delivered work or ask for a revision from the author (Section 66(7) of the Copyright Act)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - establishment of a lien on a trademark (Section 20 of the Act XI of 1997 on the Protection of Trademarks and Geographical Indications; “Trademark Act”)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - statement by a proprietor listed in the Trademark Register surrendering trademark protection (Section 32(1) of the Trademark Act)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - power of Attorney granted to a patent agent or an attorney relative to a trademark matter involving a foreign national and falling under the jurisdiction of the IP Office (Section 44(1) of the Trademark Act)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - request for the acknowledgment from the IP Office of rights or facts concerning trademark protection (Section 48(2) of the Trademark Act)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - contract for the transfer of collective or certification trademark protection (Section 98(1) of the Trademark Act)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - request of the inventor to not indicate his/her name in the patent documents to be published (Section 7(5) of the Act XXXIII of 1995 on the Patent Protection of Inventions; “Patent Act”)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - the royalty contract, the contract governing remuneration in case of the exploitation of an employee invention, and the presentment, declaration, notification and information prescribed in the Act, relating to service inventions and employees inventions (Section 15(1) of the Patent Act)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - filing of a lien on the rights originating from an invention and from patent protection (Section 25(1) of the Patent Act)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - declaration of surrender of patent protection of the applicant shown in the Patent Register, or the holder of the patent (Section 41(1) of the Patent Act)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - power of Attorney granted to a patent agent or an attorney-at-law for representation of a foreign person in all patent matters which are in the jurisdiction of the IP Office (Section 51(1) of the Patent Act)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - waiver of the applicant of any claim for compensation in connection with having a patent classified (Section 53(11) of the Patent Act)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - request to the IP Office for the acknowledgment or the registration of rights or facts in connection with patent protection (Section 55(2) of the Patent Act)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - authorization of the organization of right-holders of plant variety rights to represent its members and other right-holders (Section 109/A(5) of the Patent Act)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - Agreement between the holders of plant variety rights and the farmer about the amount of the remuneration and the terms of payment (Section 109/A(7) of the Patent Act)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - request of the holder of plant variety rights for information on the quantity of the product of the harvest for propagating purposes of either of the plant varieties, which is covered by a plant variety right on behalf of the right-holder, including the name and address (registered office) of the person for whom the processing service was provided (Section 109/B(4) of the Patent Act)

• AES, QES, or advanced electronic seal + qualified electronic time stamp - in case of conclusion of off-premises contracts, upon request of the consumer, the information that is legally required to be provided to consumers by the traders (Section 12(1) of Government Decree No 45/2014. (II. 26.) on the detailed rules of the agreements concluded between consumers and traders

• QES - a written legal statement made by a person who is illiterate or incapable of writing (Section 6:7(4) of the Civil Code)

• QES - a power of Attorney in a court procedure (Section 67(2) of the Code of Civil Procedural)

• QES – a general power of attorney (Section 6:16 of the Civil Code)

• QES - a power of Attorney for representation in the decision-making process of a business association’s supreme decision-making body (3:110 (1) of the Civil Code)

• QES - the notification of the change of ownership in the register of shareholders of a limited company (3:168(2) of the Civil Code)

• QES - the acknowledging of the provisions of the memorandum of association by new shareholders upon the increase of registered capital (Section 3:200(2) of the Civil Code)

• QES - the contract between a single-member company and its sole member (3:209 (1) of the Civil Code)

• QES - a power of Attorney for representation in the decision-making process of a cooperative’s supreme decision-making body (Section 3:337 of the Civil Code)

• QES - the statement of consent of the proprietor of earlier conflicting rights to the registration of a trademark (Section 7 of the Trademark Act)

• QES - any written legal statement relative to the employment relationships made by a person who is illiterate or incapable of writing (Section 22(6) of the Act I of 2012 on the Labor Code)

Use Cases That Are Not Typically Appropriate for Electronic Signatures or Digital Transaction Management

Use cases that are specifically barred from digital or electronic processes or that include explicit requirements, such as handwritten (e.g. wet ink) signatures or formal notarial process that are not usually compatible with electronic signatures or digital transaction management.

• Handwritten - all documents concerning family relationships and civil partnerships (Fourth Book of the Civil Code)

• Handwritten - all documents concerning inheritance matters (Sixth Book of the Hungarian Civil Code)

[1] An AES is an “advanced electronic signature”, a type of electronic signature that meets the following requirements: (a) it is uniquely linked to the signatory; (b) it is capable of identifying the signatory; (c) it is created using means that are under the signatory’s sole control; and (d) it is linked to other electronic data in such a way that any alteration to the said data can be detected.

[2] A QES is a specific digital signature implementation that has met the particular specifications of a government, including using a secure signature creation device, and been certified as ‘qualified’ by either that government or a party contracted by that government.

An “advanced electronic seal” is an electronic seal if a legal person that meets the following requirements: (i) it is uniquely linked to the creator of the seal; (ii) it is capable of identifying the creator of the seal; (iii) it is created using electronic seal creation data that the creator of the seal can, with a high level of confidence under its control, use for electronic seal creation; and (iv) it is linked to the data to which it relates in such a way that any subsequent change in the data is detectable.

A “qualified electronic seal” is an advanced electronic seal of a legal person which is created by a qualified electronic seal creation device and that is based on a qualified certificate for electronic seal.

Local Technology Standards

As a Tiered eSignature Legal Model country, Hungary supports the concept of a QES (Qualified Electronic Signature), requiring independent accreditation for those signatures by an approved certification body. In compliance with the EU Regulation No. 910/2014 on Electronic identification and trust services for electronic transactions in the internal market, Hungary maintains a publicly accessible list of supervisory bodies for qualified certificated providers together with other countries in the European Union.