Orbán Decree Orders Court to End Budapest Lawsuit

A government decree reportedly instructs the court to terminate Budapest’s case over the 2023–2025 “solidarity contribution,” prompting sharp legal criticism about emergency powers, judicial independence, and the separation of powers—while the capital argues it is being denied the right to challenge the levy before an independent judge.

A Sudden Turn in a High-Stakes Fiscal Dispute

Viktor Orbán, Hungary’s prime minister, has issued a decree ordering the court to discontinue a lawsuit brought by the City of Budapest over the “solidarity contribution”—a fiscal transfer mechanism under which wealthier municipalities pay into the central budget to support financial equalisation across local governments. The capital’s case challenged the lawfulness of the payment obligation imposed for the 2023–2025 period.

The decision triggered immediate professional and political reactions, with multiple lawyers and constitutional scholars criticising the move publicly.

 Emergency Powers Cited to Halt an Ongoing Case

According to Reuters, the decree is specifically aimed at ending a pending case involving the capital, and the prime minister adopted the measure by invoking emergency powers under Hungary’s state of danger framework.

The government’s position is that the state is entitled to collect the solidarity contribution, which it says serves the public interest by redistributing resources among municipalities.

What the “Solidarity Contribution” Is—and Why Budapest Went to Court

Under the solidarity contribution system, municipalities with higher revenue-raising capacity—Budapest among them—are required to make payments into the central budget.

Budapest argues that the scale of the levy places a disproportionate burden on its finances and infringes municipal autonomy. On that basis, the city turned to the courts to challenge the legality of the obligation for the 2023–2025 period.

The Court’s Position vs. the Decree’s Instruction

The Budapest Metropolitan Court (Budapesti Törvényszék) did not comment on the merits of the case in response to Reuters’ inquiry, but noted that in pending matters judges act on the basis of the laws currently in force.

At the same time, the decree reportedly contains a direct instruction that the proceedings be terminated—setting up a potential tension between judicial practice and executive rulemaking.

Legal Backlash: Separation of Powers and Judicial Independence

Following the decree, several lawyers and constitutional experts voiced criticism. Reuters reported that rights groups said executive intervention of this kind in a live judicial proceeding raises questions about the separation of powers.

A representative of the Hungarian Helsinki Committee was quoted in the international press as saying that the government—acting as a litigant—has used a decree to order the termination of proceedings, which in their view raises constitutional concerns.

Constitutional Limits of Emergency Decree-Making

In Hungary’s public debate, constitutional scholars have argued that the limits of emergency decree-making may be tested if executive rulemaking directly affects specific, ongoing court cases. Several emphasised that, under Hungary’s Fundamental Law, courts are independent and the executive cannot issue direct instructions in an individual case.

 Budapest Is Denied Effective Legal Remedy

After the decree, Budapest Mayor Gergely Karácsony said the measure deprives the capital of the opportunity to challenge the legality of the obligation before an independent court.

In his view, the dispute goes beyond a budget disagreement and carries institutional significance—touching on the balance between central government authority and municipal self-government.

Political Context: Election Season and EU Rule-of-Law Tensions

Reuters situated the decision in the political environment ahead of Hungary’s April 2026 parliamentary election. The agency also noted Hungary’s long-running dispute with the European Union over rule-of-law issues, with Brussels continuing to withhold several billion euros in funding while linking disbursement to reforms in Hungary.

What Comes Next

The next phase may depend on how the court interprets and applies the decree, and whether Budapest or other affected actors initiate constitutional review—potentially turning a fiscal conflict into a broader test of emergency powers, judicial independence, and the separation of powers.