The Status of the Limited Liability Company since the New Hungarian Civil Code Came into Effect

Abstract

Historically, the form of the limited liability company was first introduced in Hungary by Act V of 1930. This type of company, which is equipped with all the advantages of members in a limited liability, was born out of the relevant necessity in the economy. However, it is quite flexible in its nature, could be established easily and demonstrates a simpler organizational structure than a company limited by shares. Therefore, the limited liability company fits within the general frame of small and medium enterprises, and is the main and most popular form of a company in Hungary. This paper gives an overview of the characteristics, regulations, foundation, organization, minority rights, business share, members and managing directors’ liabilities in Hungarian limited liability companies from a regulatory and practical perspective.