The Hungarian Government Plans Legal Action After the EU Criticizes its Motorway Concessions
In response to a prompt from the European Union, Hungary has quickly articulated its stance.
The European Commission has criticized Hungary over a 35-year motorway concession, alleging that the deal lacked transparency concerning its estimated value, failed to transfer appropriate operational risk, and unjustifiably extended the duration in violation of EU law. Consequently, Hungary has been urged to align such contracts with the applicable regulations.
The government has issued a statement through the Government Information Center addressing the European Commission's concerns, asserting that,
legal actions will be taken to defend what they consider a lawful motorway contract.
According to the statement, the contested new concession contract serves national economic objectives. In its quest, the concessionaire commits to the long-term, high-quality operation and maintenance of expressways, including the construction of 317 kilometers of new motorway and the expansion of 265 kilometers of motorway within the next ten years.
The statement further notes the implementation of these plans would not be possible without the concession due to the absence or shortfall of EU funding, whereby the concessionaire assumes both operational and financial risks from the state. This arrangement, they argue, significantly eases the burden on the state budget.
Furthermore, the government argues that the length of the majority of motorway concession contracts in Europe typically falls within the 26-35 year range, noting that several European motorway concession agreements have durations around 50-80 years.
The statement also references Spain, where concessions for building and operating motorways are a common practice. The duration of concessions for the vast majority of the 45 Spanish motorways ranges from 30-35 years, with several extending to 55, and even 75 years.
It's important to add, the EU has also called out Spain alongside Hungary for non-compliance with the regulations governing motorway concession contracts. In Spain's case, the extension of two motorway concessions without properly applying procurement procedures was highlighted as a concern.