By removing usufruct rights held directly or indirectly by nationals of other Member States on agricultural land on its territory, Hungary has failed to fulfil its obligations under the property right guaranteed by the European Charter of Fundamental Rights, the Court of Justice of the European Union ruled on Tuesday 21 May (Case C-235/17).
In 2013, Hungary adopted a regulation providing that usufruct rights on agricultural land located on its territory would only be granted or maintained, from May 2014, in favour of persons closely related to the owner.
In March 2018, the EU judge had already ruled that the Hungarian rules constituted an unjustified restriction on the principle of the free movement of capital (Cases C-52/16 and C-113/16) (see EUROPE 11975/19).
With today's judgment, it emphasises that the contested restriction cannot be justified, in accordance with the principle of proportionality, by Budapest's desire to reserve agricultural land for those who exploit it, to prevent the acquisition of such land for speculative purposes and to punish infringements of national rules on exchange controls and on the acquisition of agricultural land.
The Court also points out that, when a Member State seeks to justify the restriction of one or more fundamental freedoms, the compatibility of national legislation with EU law must be examined in the light of the exceptions provided for by the Treaty and the Court's case-law and the fundamental rights guaranteed by the Charter.
In that regard, the Court finds that the removal of usufruct rights resulting from the contested regulation constitutes a deprivation of property within the meaning of the Charter. But according to the judges, the deprivation of property resulting from Hungarian legislation is not justified by reasons of public utility and there is no provision for compensating holders of dispossessed usufruct rights.
See the judgment: http://bit.ly/2JWpLQy. (Original version in French by Mathieu Bion)