Hungarian regulator’s powers over gambling concessions to be reduced
Lawmakers have approved measures that would eliminate a requirement for SZTFH approval on concession tenders
Key takeaways:
- Hungary’s parliament has approved measures to dismantle the Supervisory Authority for Regulated Activities’ Concessions Council, a major step in advancing the government’s review of how gambling and other regulated concessions are managed.
- If fully implemented, the changes would eliminate the need for SZTFH approval on concession tenders, invitations to bid, and the conclusion, amendment or termination of concession agreements.
- The TISZA government continues to review various state institutions, including the monopoly sports betting operator,
Hungary.- The Hungarian parliament has approved measures that reduce the powers of the country’s Supervisory Authority for Regulated Activities (SZTFH) thus advancing the new TISZA government’s plans to overhaul the system for overseeing gambling licences as well as other regulated sectors.
Lawmakers voted on Friday, (October 2), to limit the regulatory authority’s responsibilities and dismantle its Concessions Council, whose advisers were appointed during the previous Fidesz government. The legislation was backed by 135 MPs, while 46 voted against and six abstained. The measure was largely supported by members of Prime Minister Péter Magyar’s TISZA party, which holds a two-thirds supermajority in Hungary’s National Assembly.
Created in 2021, the SZTFH is responsible for overseeing gambling, alongside sectors including tobacco, mining and cybersecurity. Its mandate has brought it under scrutiny amid a government review of various state institutions. The authority has faced criticism over its management of gaming concessions awarded during Viktor Orbán’s Fidesz administration, with opponents alleging cronyism in the process.
The reforms originate from Bill T/639, submitted by the government on September 8. If fully implemented, the new arrangements would eliminate the need for SZTFH approval on concession tenders, invitations to bid, and the conclusion, amendment or termination of concession agreements.
The government has also tasked ministers with examining how gaming concessions were awarded under the regulator’s oversight. Parties involved in relevant gambling contracts have been given 30 days to provide details of ownership structures and management arrangements.
Hungary’s review of state bodies
The review forms part of Finance Minister András Kármán‘s anti-corruption agenda, a central pledge of the TISZA government as it seeks to rebuild confidence in Hungary’s economy following several years of weak performance relative to other EU member states.
The SZTFH has rejected aspects of the criticism directed towards it during the reform debate. The authority has stressed that it never possessed the power to award concessions directly, arguing that such decisions were always the responsibility of the government. In a statement issued on Friday, it reiterated that its role was confined to providing prior consent and oversight functions. Former officials have also accused the government of unfairly portraying the authority as responsible for wider economic challenges.
The latest parliamentary action follows a government resolution published in the Hungarian Gazette on August 31 ordering a review of both the SZTFH’s operations and the legislation governing its responsibilities. Justice Minister Márta Görög was instructed to explore options for abolishing the authority and transferring its powers to bodies operating under direct government control.
A particular area of focus has been casino concession agreements covering locations including Debrecen, Győr, Miskolc, Pécs, Sopron and Szeged. Some of these concessions extend for decades, with the Sopron licence linked to CAI Hungary Kft reportedly remaining in force until 2061.
Alongside questions around concessions, authorities are examining the regulator’s handling of Hungary’s online gambling and sports betting reforms introduced between 2022 and 2023. These followed a European Court of Justice ruling that required changes to Hungary’s gambling framework after concerns were raised about an online monopoly held by state-owned operator Szerencsejáték Zrt. Although the reforms were intended to create a more competitive market, international operators largely stayed away amid claims that the revised rules continued to favour the state-backed company.
TISZA has already moved to reshape the leadership of Szerencsejáték Zrt. In July, Kármán confirmed the appointment of Marcell Olajos as the operator’s chairman following the dismissal of Zoltán Guller in June. Board members Krisztina Rédey, Gábor Bordás, Szabolcs Ágostházy and Zsófia Illés-Puka were removed, while Marianna Gabriella Poltné Palásthy resigned.
Szerencsejáték Zrt remains a strategically important state-owned business, generating significant revenue for public finances, while proceeds from lottery activities help fund cultural, artistic and heritage projects across the country. For now, the government has not indicated whether the current reforms and reviews will lead to increased liberalisation and competition in gambling in Hungary.
FAQs
What changes are being made to the Hungarian gambling regulator?
MPs voted to limit the powers of the SZTFH and abolish its Concessions Council. If fully implemented, the reforms would remove the authority’s role in approving concession tenders, bid invitations, and changes to concession agreements.
Why is the Hungarian government reviewing gambling concessions?
The review forms part of the TISZA government’s anti-corruption programme. Officials are examining how gambling licences and concessions were awarded under previous governments amid allegations of cronyism and concerns about transparency.
Will reforms make Hungary’s gambling market more competitive?
It remains unclear. The government is reviewing both concession arrangements and gambling regulations, including online betting reforms, but it has not announced whether the process will result in further market liberalisation or new opportunities for private operators.
