BBJ 2511

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BUSINESS JOURNAL BUDAPEST

VOL. 25. NUMBER 11

3

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Budapest Business

JUNE 2 – JUNE 15, 2017

.hu

2017 2 – June 15, Journal | June

ial Rt eport Spec Legal Marke

14 Hard to Serve Law Firms Working International s of AI 15 The Mixed Blessing 16 New Legal Blood In Search of ogy 29 and Technol Investing in Talent

an Law firms face extremely market, competitive y battle the as n eve nts and for new tale ce AI seek to embra

SPECIAL REPORT

Legal Market SPECIAL REPORT

International law Firms Working Hard to Serve Despite some headaches over the shortage of committed workforce supply and a rapidly-changing regulatory environment, the biggest firms are not afraid of losing their market positions.14 NEWS

Investments Jump From low Base Signs indicating the economy could perform a 4% expansion this year are gathering. The latest investment figures were exceptionally good, however, last year’s low base and the return of EU funds also helped.3 SOCIALITE

Planetarium to Close in its 40th Year The building is in a dangerous condition, while its technology has long been obsolete. The institution desperately needs the Hungarian state to step in with public money, which may come in the fall.39

Tourism set for Take-off

I N ES BUS

S

Dr. Zoltán Guller, head of the Hungarian Tourism Agency (MTÜ) promises a massive, targeted investment into the tourism industry that puts visitors, and families, firmly in focus.11

BUDAPEST

BUSINESS JOURNAL

congratulates

Horváth & Partners DLA Piper

after its second consecutive “Law Firm of the Year in Hungary” award.

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Budapest Business Journal | June 2 – June 15, 2017

BBJ

THE EDITOR SAYS

EDITOR-IN-CHIEF: Robin Marshall NEWS EDITOR: Christian Keszthelyi EDITORIAL STAFF: Zsófia Czifra, David Holzer,

Levente Hörömpöli-Tóth, Gary J. Morrell, Claudia Patricolo, Mátyás Pödőr, Rob Smyth, Noémi Titz, Ágnes Vinkovits. LISTS: BBJ Research (research@bbj.hu) NEWS AND PRESS RELEASES:

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Address: Madách Trade Center 1075 Budapest, Madách Imre út 13-14., Building A, 8th floor Telephone +36 (1) 398-0344, Fax +36 (1) 398-0345, www.bbj.hu SUBSCRIPTIONS: Budapest Business Journal 1 year 6 months 3 months

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News Services Hungary A.M., Energy Today, Regional Today 1 year, from HUF 179,000+VAT 6 months, from HUF 104,900+VAT 3 months, from HUF 58,900+VAT Book of Lists 2016-2017: HUF 19,120+VAT DigiBOL HUF 39,900+VAT Call +36 1 398-0344 or email circulation@bbj.hu What We Stand For: The Budapest Business Journal aspires to be the most trusted newspaper in Hungary. We believe that managers should work on behalf of their shareholders. We believe that among the most important contributions a government can make to society is improving the business and investment climate so that its citizens may realize their full potential.

I

have lost count of the number of chamber of commerce events I have attended in the past few years where one government official or another has lauded the “stability” Fidesz has brought to Hungary’s political scene. In one sense, they have been absolutely right, for Fidesz has been in power continuously since 2010, and looks absolutely nailed on to remain so after the 2018 elections. But those government representatives have tended to confuse time in office with legislative stability, and it is the latter that businesses really care about. Governments change; it is an inevitable by-product of the democratic process. According to Wikipedia, Viktor Orbán became the third-longest serving PM in Hungary’s history in November of last year, and Fidesz is enjoying a period of unusual continuity (unprecedented by Hungarian standards since the change of political system in 1989, but generally speaking remarkable even by European norms), but business does not much bother about that. As the markets like to say, the possibility of change is largely factored in. Of much greater concern to companies is that the legislative framework within which they work is predictable. When Fidesz was returned to power in 2010 (the party won its first general election in 1998, but stayed in office for just one term), it went on a law-making frenzy. Parliament today is a much less hectic place than back then, but the government, or perhaps more accurately the party, has not lost the ability to surprise. Laws appear almost out of nowhere, with very little warning, a lot of them brought forward by individual

MPs. Fidesz would doubtless argue that is democracy at work, but a surprising amount of legislation, such as the recent NGO law (see our interview on page 18 for more on this), seems to be brought into Parliament this way. That is important because if the government wants to introduce a new law, the constitution requires it to do a due diligence of its likely impact and to consult with affected parties, but that is not the case for MPs. Fidesz contains within its ranks a lot of people who studied law; Orbán himself is described as a jurist by Wikipedia and received his law degree from Eötvös Loránd University in 1987. In interviews for this issue’s Special Report, I asked a number of leading lawyers what they make of the quality of Hungary’s law making. “It is not the quality, but the quantity.…” was a common response. The government can produce good laws. As one respondent put it, the new Hungarian Civil Code “offers rules formulated with everyday words wrapped in the simplest grammar. It’s an effort worth every drop of sweat.” The government has also sought to bring in laws that are more relevant to the way we do business today, allowing f lexible working relationships. It is now looking at creating a pensioners’ association through which firms can hire retirees who want to return to work without the need to pay social security contributions. Chambers such as AmCham will point to the successes it has achieved in lobbying for reduced corporate tax rates or for greater mobility and R&D incentives. The government has proved it can draw up good and useful laws and consult effectively. We need more of that, and less legislation brought in through party MPs.

Fortepan.hu / Ludovika

MTI / Attila Balázs

The Budapest Business Journal, HU ISSN 1216-7304, is published bi-weekly on Friday, registration No. 0109069462. It is distributed by HungaroPress. Reproduction or use without permission of editorial or graphic content in any manner is prohibited. ©2017 BUSINESS MEDIA SERVICES LLC with all rights reserved.

WANTED: LAW-MAKING STABILITY

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THEN & NOW

With the summer heat arriving in Hungary way before the summer solstice on June 21, the strand (lido) season could not have started at a better time than last weekend. In the color photo, a woman introduces a child to the joys of water at the recently opened pool at Nyíregyháza-Sóstógyógyfürdő (about 240 km east of Budapest) on May 28. In the black and white picture taken in 1954, a child prepares to freshen up in Lake Balaton.

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News

1 News | 3

///macroscope

Investments Jump From low Base

Source: KSH

Signs indicating the economy could perform a 4% expansion this year are gathering. The latest investment figures were exceptionally good, however, last year’s low base and the return of EU funds also helped.

Volume indices in various sectors (corresponding period of previous year=100%)

ZSÓFIA CZIFRA

The volume of investments in Hungary increased 34.1% in the first-quarter from the same period of last year, amounting to a record of HUF 1.033 trillion, according to the latest data released by the Central Statistical Office (KSH). The good news came after a 24.1% fall in the last three months of 2016. Low base effects also had a notable role in the increase: the volume of investments fell back by nearly 15% in the first quarter of last year compared to the same period a year earlier, chiefly due to the completion of developments financed from EU sources. That was the second biggest drop in investments since 2000, while this year’s first-quarter data is unprecedented, the KSH said. Apart from the very low base of the same period of last year, the kick-off of projects launched under the 20142020 EU funding cycle also gathered momentum, causing the surprisingly high rise in investments volume. Growth was strong in nearly all areas of the national economy, showing a dynamic expansion in 17 out of the 19 economic sectors. Investment performance

grew by

40% in the case of enterprises employing at least 50 persons (realizing six-tenths of investments) and by 31% in the public sector. Detailed data shows that EU funds have provided a kick-start to practically all areas of national economy. Of the areas with a relatively large weight, the highest increase (56%) was recorded in the investment performance of real estate activities, with residential constructions and commercial real estate developments both increasing. The second best-performing area was transportation and storage, where

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EU funds also played a significant role, increasing investments by 48% from the first quarter of 2016. Also in the top three sectors was manufacturing, representing more than onethird of investments in the national economy. Expansion in this area had already started in the second-quarter of 2016. The investment performance of wholesale and retail trade, and the repair of motor vehicles and motorcycles – after growth across three quarters – increased again, mainly due to retail unit upgrades, reconstructions and renovations. The investments of agriculture, forestry and fishing also performed well, mainly as the result of acquisitions of agricultural machinery. Investments in mining and quarrying, which represent a relatively small weight in the national economy, were four times higher than in the same period of last year. The developments of construction – partly as an effect of the growth of production – were up by 16%. The investment performance of information and communication expanded by 14%, which was influenced by acquisitions of telecommunications equipment and extensions of cable networks, too. EU funds showed their effects on areas which are mostly publicly financed, such as public administration, defense, compulsory social security and education. The only area showing a setback was one where the state is also supposed to be

the main investor, namely human health services, where investments

decreased by

7.8%. “Even taking the low base into account, investment growth was the highest since the fall of communism,” Minister for National Economy Mihály Varga commented on the data. Investments in manufacturing, such as developments at Apollo Tyres, Mercedes and Samsung, have seen very serious growth, he said. “If investment growth is sustained, even if not at such a high pace, the investment rate will also grow, which in turn boosts job creation and helps secure the targeted economic growth rate of 4% in 2017 and 2018,” he added. In light of the more than 4% GDP growth registered in the first quarter of 2017, the jump in investments is not surprising, however, 34.1% is way above expectations, economic new website portfolio.hu wrote. Investments are on an increasing path, driven not only by funding from the European Union, but also by the suddenly livening global economy, the site says, adding that EU funds will keep motivating investments in the upcoming two years, and if the global economy continues to be supportive, we will see investments further increasing in the longer run.

Investments data exceeded all expectations, and the 34.1% increase is a record, noted Takarékbank analyst Gergely Suppan. The exceptionally good figures were caused by base effects paired with an accelerating investment rate, as investment volume grew a seasonally adjusted 7.4% from the last quarter of 2016. He also mentioned the role of efficient utilization of EU-funds. Suppan expects that investment volume will grow nearly 20% this year, and the growth rate could still be around 10% in 2018, following a 20% setback in 2016. K&H Bank analyst Dávid Németh said that the more than 30% growth is a good result, even in the light of the very low base. Investments are catching up after a setback last year, he said.

Numbers to Watch in the Coming Weeks The KSH will publish the first estimates of April retail trade on June 6, followed by the second estimate of Q1 GDP data. Also on June 7, KSH will release the first estimate of industrial performance referring to April, while more detailed data will follow on June 14. The consumer price index for May will be revealed on June 8.

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News

///in brief

EU’s visa waiver for Ukraine may boost Debrecen Airport traffic The European Union’s decision to waive visas for Ukrainian citizens from midJune is expected to boost tourist traffic from Transcarpathia to Western Europe and Israel for Debrecen International Airport, which lies 130 kilometers from the Ukrainian border, according to a press statement sent to the Budapest Business Journal. About 1.3 million people in the Transcarpathia region of Ukraine will be freer to explore the countries of Europe. “Debrecen Airport is the largest regional airport in Hungary, which also meets the Schengen criteria,” the operators note. “Thanks to continuous new route development, the number of passengers is also increasing month by month. This growth is not only beneficial for the development of the airport, but also has a positive impact on the tourism turnover of the region,” said László Tamás, director of aviation development at the airport. “The EU visa waiver for Ukrainian citizens in mid-June can have a positive impact on tourist traffic from Transcarpathia to

Western Europe and Israel. We are optimistic that the number of guest nights spent by foreign tourists will increase significantly, as will the occupancy rate of hotels in the region,” Tamás added.

Beer sales seen rising as much as 2.5% in 2017 Sales of top beer brewers in Hungary could rise by 2-2.5% this year from 6.7 million hectoliters in 2016 if the summer is warm and sunny, business daily Világgazdaság reported, citing data from the Association of Hungarian Brewers (MSSz). Attila Schillinger, the head of the organization, believes sales of more expensive premium and superpremium brands by the top four brewers (Borsodi, Dreher, Heineken and Pécsi Sörfőzde) could increase by 10-12%. He observed that this is tied to GDP growth, which was registered at 4.1% in the first quarter. Schillinger noted that summer weather, festivals, big sports events and gastronomical trends all influence annual domestic consumption. MSSz members paid HUF 72.5 billion in taxes last year,

Budapest Business Journal | June 2 – June 15, 2017

a figure that is expected to rise this year. Schillinger said that the longterm security of the 1,700 people directly employed in the brewing industry seems assured, while the jobs of the 24,000 people working throughout the sector’s value chain remain safe provided there is no dramatic fall in the turnover of small restaurants and pubs.

Base rate may freeze until 2019, says deputy governor

The current base rate of the National Bank of Hungary (MNB) could be kept intact until 2019, or possibly even beyond, deputy governor Márton Nagy told wire service Reuters. Nagy also pointed out that inflationary expectations were anchored at a very low level despite strong wage growth. The deputy governor spoke to the wire service in Budapest at the Reuters Central and Eastern Europe Investment Summit, following the decision by the MNB’s Monetary Policy Council to leave the base rate at 0.9%. Nagy commented on the expectations of analysts polled by Reuters, speculating that the key figure could remain the same until 2019, or even beyond. “I think that this can be even longer than that, the end of 2019 or even 2020, but the market decides where it expects the base rate to go,” Reuters cited the deputy governor as saying. At

Photo: MTI / Attila Kovács

Hungary, Kenya enter economic and technological cooperation

Kenyan Foreign Minister Amina Mohamed and Minister of Foreign Affairs and Trade Péter Szijjártó agreed in Budapest on May 29 that the two countries will look to cooperate in the areas of economy and technology. Under the agreement, Hungary’s Eximbank will open an EUR 85 million euro credit line to help Hungarian enterprises enter the Kenyan market. A USD 50 million tied aid program will also be launched, enabling Hungarian companies to build obstetrics and oncology hospitals in Kenya. Mohamed said the agreement was a clear indication of improving Hungarian-Kenyan relations. She welcomed the tied aid agreement and the increase in the number of scholarships for Kenyan students to attend Hungarian universities.

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the same time, Nagy noted that the central bank does not focus only on the base rate, but rather looks at overall monetary conditions, including interbank rates, short-term yields and implied forint yields on the swap market. Nagy told Reuters that markets had priced out an increase in Budapest interbank rates over a one-year horizon after the bank communicated loose monetary conditions for an extended period. He added that, in order to maintain loose monetary conditions, the bank had to squeeze out about HUF 300 billion-400 bln of funds from its deposit tool into the economy each quarter by capping deposits and/or using its swaps to pump liquidity into the system.

Two-thirds of guest room revenue booked online Online bookings accounted for a little more than two-thirds of spending by domestic guests on rooms at commercial accommodation in Hungary last year, a survey by online researcher GKI Digital shows, according to Hungarian news agency MTI. Online bookings by Hungarian guests generated HUF 62 billion in revenues for local commercial accommodation. Overall spending by Hungarian guests on rooms reached HUF 92 bln. The booking site szallas. hu accounted for 45% of revenues from online bookings, while the site maiutazas.hu generated 38%.

Hungary holds first corporate Diversity Week

Following a recent tradition in the European Union, Hungary is holding a corporate Diversity Week for the first time, under the aegis of the EU Diversity Charter in Hungary and the Hungarian Business Leaders Forum (HBLF), according to a press release sent to the Budapest Business Journal. Across the EU, hundreds of business ventures participate with thousands of their employees to call attention to the importance of workplace diversity and equal opportunities during the week. In Hungary, 31 companies have already joined the initiative, and organizers encourage all local businesses to join. Companies that have already enrolled will organize events such as a meeting for new mothers, diversity garage sale, multicultural lunch, a drawing competition for children on the possibilities and challenges of handicapped transport, round table meetings and workshops. The main aim is for companies to organize events and activities for their employees through which they promote and call attention to equal treatment, to openness towards each other, and to the need for acceptance. “There is a need for open leaders and colleagues, respect for being different, and the determining of diverse values at a company in order to establish a market culture in Hungary that welcomes and supports diversity and equal opportunities,” said HBLF CEO Eszter Pataki.

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Budapest Business Journal | June 2 – June 15, 2017

REAL ESTATE NEWS

1 News | 5

Real Estate Transaction Volume on Course to Surpass Last Year Transaction volume in the Hungarian investment property market for the year will surpass last year’s total of more than EUR 1.54 billion in the view of CBRE, after EUR 490 million worth of deals were concluded in the first quarter. GARY J. MORRELL

The company says it was involved in eight major transactions where office buildings and industrial properties accounted for almost EUR 350 mln. It expects that a further EUR 500 mln of deals will soon appear on the market. “With a number of other high-profile assets in the deal pipeline and due to be announced in the second quarter of 2017, CBRE is of the opinion that investment volumes could top those of 2016,” said Tim O’Sullivan, head

The Skypark office building, sold for more than HUF 40 bln.

of capital markets at CBRE Budapest. This increased level of activity is based around new equity entering the market and the solid fundamentals underpinning investor assumptions and underwriting. Cushman & Wakefield estimate the first quarter figure at EUR 430 mln, with office the leading market sector at EUR 210 mln, compared with EUR 160 mln for retail and EUR 60 mln for industrial. JLL puts the total investment volume for the first quarter at EUR 533 mln, which compares to EUR 440 mln for Poland and a massive EUR 1.355 bln for Czech Republic, making it currently

the leading investment market in the CEE region. Colliers International puts the first quarter investment total at EUR 520 mln, with a sector breakdown of 40% for office, 30% for retail and industrial at 20%. Colliers says it expects the 2017

total investment volume to be

EUR 1.8 bln-2 bln.

Key Investments JLL has traced eight key investment transactions for the quarter. In the office

market, Futureal Group sold the 25,000 sqm Skypark office building to the OTP Prime Property Investment Fund for more than HUF 40 bln. The Hungarian fund also purchased the 25,000 sqm Váci Greens B in the Váci Corridor from Atenor. OTP, Erste and Diófa are continuing to be particularly active in the office and logistics sectors. JLL estimates that 40% of the investment volume was concluded by investors of Hungarian origin. A major international industrial deal was the purchase of the 62,000 sqm Aerozone logistics center, located in the vicinity of the Ferenc Liszt International Airport, by British investor M7 Real Estate. In recent deal, CTP continued its expansion with the acquisition of the 58,000 sqm Rozália Park from Challenger, the logistics scheme being located to the west of Budapest. “Hungary’s logistics sector has the strongest dynamics in Central Europe in terms of rental growth prospects, supply, vacancy rates and potential for yield compression. This is being increasingly recognized by investors, as demonstrated by this transaction,” commented Mike Edwards, head of capital markets at Cushman & Wakefield Hungary, which brokered the deal. Yields are put at

6.75% for office,

compared to 6% for retail and 8% for industrial according to JLL. A new benchmark CEE office yield of 4.85% has been recorded in Prague.

Budapest Airport Hotel Topped Out

Developer Wing has topped out the ibis Styles Budapest Airport Hotel building at the Ferenc Liszt International Airport and says it is on schedule for completion by December. Budapest Airport, operator of the airport, says the threestar plus hotel project will create a landmark building that raises the profile of the airport. GARY J. MORRELL

The 5,200 sqm hotel is being developed through a partnership between Budapest Airport and Wing, with Market Építő undertaking the construction. The project is being constructed directly in front of Terminal 2. The developer will hand over the hotel to the operator, the ibis Styles hotel chain, a member of the Accor group. The operating rights for the project have

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“The addition of a hotel is important for the airport, the city and the country with regard to economic and tourism development.” been awarded on a 15-year contract. The hotel, penned by Wing’s in-house designers Aspectus Architect Zrt., will provide 137 rooms in a contemporary design style and eight suites. In addition, the hotel will consist of a 350 sqm conference center with the capacity accommodate 250 people, plus seminar and meeting rooms. The restaurant will have capacity for 125 diners; it and the lobby bar will also be available to external guests such as transfer passengers, and will provide a location for Hungarians to conduct meetings with foreign partners at the airport. According to the business plan and perceived demand, the operators expect an 80-90% occupancy.

Record Growth At the topping-out ceremony, Jost Lammers, CEO of Budapest Airport, emphasized the record growth in

Aerial view shows the central location of the new hotel.

passenger traffic seen over the past few years at the airport. For 2107, more than

12 million passengers are expected,

representing 6-10% annual growth. “The construction of the new hotel is an organic part of our HUF 50 billion airport development program, BUD 2020. Among the guests of the hotel we will find business people, participants of conferences, and tourists on weekend city breaks as well as aircraft crews spending the night in Budapest,” he said.

Wing is as investor in the

HUF 3.2 bln project,

financed through its own equity and a loan from EXIM Bank. “The addition of a hotel is important for the airport, the city and the country with regard to economic and tourism development,” said Noah Steinberg, chairman and CEO of Wing at the ceremony. Lammers says the hotel project is part of an ambitious project to turn Ferenc Liszt International Airport into a regional travel and logistics hub.

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Business

Business

Providing Seamless Connectivity From Budapest QATAR AIRWAYS Grisha Jenkov,

BBJ STAFF

You have been country manager for Central and Eastern Europe since December 2013. How important is this region to Qatar Airways and how has the regional market changed since you took over? It makes me proud to be part of one the fastest growing and most dynamic airlines in the world. It also makes it easier to focus on the strategy to be implemented on each market, which is in alignment with the vision and the strategic goals that the overall organization wants to achieve at a global level and in the region. I was previously working as commercial manager for Bulgaria and through my past position I have learnt to implement global strategies in a way that could fully accommodate local markets. The local market has changed and developed a lot over the past four years in socio and economic ways, so my responsibility as country manager is to achieve Qatar Airways’ goals, KPIs and revenue targets. We are continuously working on maintaining high performance on each market through strategic planning and analysis. My main focus in Budapest is to continue providing seamless connectivity for passengers on key destinations from and to the city, as well as maintaining an excellent service throughout their whole experience with Qatar Airways. To achieve this goal, we

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PASSENGER GROWTH BASED ON NUMBER OF CARRIED PASSENGERS

2016 +10%

2015

SOURCE: QATAR AIRWAYS

have built very strong relationships with our trade partners and work closely with tourism related associations as well as tourism agencies. How important is Budapest as a destination for Qatar Airways? Budapest is a wonderful city with lots of beauties and an amazing gastronomy culture. The capital city became part of Qatar Airways’ global expansion plan six years ago. That time there were four flights per week between Budapest and Doha, the capital of Qatar. Since then our presence has developed and since May 2 this year we are now operating no less than 12 flights a week! So, you can see that Budapest is a very popular destination and this is something Qatar Airways can strongly confirm by looking at the volumes of passengers, both leisure and business, it carries to the country. The country has very strong hospitality and world heritage culture, which makes the travel experience very unique. One of our main assets that allows us to bring more travelers to the country is the optimum connectivity we offer via our hub, Hamad International Airport, Doha to passengers from countries such as Thailand, Vietnam, Indonesia, China, Japan, but also from Australia thanks to faster routing and better connectivity. Qatar Airways began direct, daily nonstop flights between Budapest and Doha on September 14, 2011. As you mentioned, you now currently run 12 flights a week. How have passenger numbers changed since the start and what are the main goals to achieve in the near future?

Photo: Mátyás Pödőr

Qatar Airways country manager for Hungary, Poland, Croatia, Slovakia and Serbia, gave an exclusive interview to the Budapest Business Journal on the region – and this country’s – importance to Qatar, how business has changed and what is in store for the future.

Grisha Jenkov, Qatar Airways country manager for Hungary, Poland, Croatia, Slovakia and Serbia.

As per my previous comments, we have now clearly established that Budapest is a popular route on the extensive Qatar Airways worldwide network and as for all our routes, we are constantly reviewing potential opportunities. Budapest is definitely an important market for the airline and the increase in tourism is a significant indicator. We are lucky to grow in such a dynamic market and expand our presence in Budapest, which is a

gateway between West and East. Qatar Airways strives to offer a five-star travel experience to its passengers. The number of passengers has increased steadily and significantly in the past six to seven years. During the last financial year alone, we have observed a 10% increase in our passenger number versus the previous year. We operate our flights with Airbus 320s, where 120 seats are available in economy class and 12 seats in business class, and the load factor on our route is in line with our plans. Recently, Qatar Airways presented its QSuite, the first “flying suite” with a double bed. Can you tell us a little more about it and let us know about any further surprises? Through the launch of QSuite as a new business class experience on ITB Berlin this March, we introduced a premium level of travel and a never-beforeseen standard in business class travel. The customized private double-bed suites allow passengers in adjoining seats to create their own private room. This feature introduces a host of firsts to Premium Class travel, redesigns expectations for global business travelers and provides the ultimate customizable travel experience that enables passengers to create an environment that suits their own unique needs. The first flight with QSuite will operate between Doha and London from June this year. Regarding our plans in the near future, Qatar Airways has been expanding its network widely and is still doing so. Upcoming new destinations to be launched in 2018 include Canberra in Australia, Libreville in Gabon, Rio de Janeiro in Brazil, San Francisco and Las Vegas in USA, and Sarajevo in Europe. The airline clearly has a good relationship with Budapest Airport, most recently winning the title of the Best Airline Marketing Partner 2016 in the annual BUD awards in February this year. What makes Budapest such a good airport? Indeed, we are delighted with our working relationship with Budapest Airport. It is very important to work closely together because our goal is common: Bring more passengers to Budapest year-onyear and provide them with an excellent product and service. It is essential that our marketing and communications activities are synchronized and support each other in order to reach more potential customers. Amongst other actions, we regularly run online promotions with the airport’s support, but we also sponsored the Runway Run charity event as one the main sponsors last year, and are planning to do so this year. This event shows how air traffic becomes more and more popular among the B2B and B2C sectors.

2017. 05. 31. 18:44


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Budapest Business Journal | June 2 – June 15, 2017

Company ///news

merchants to sell goods and services more securely to clients not only in Hungary, but in all other 200+ markets where PayPal is present. According to a recent report by global consultants Accenture, crossborder e-commerce is taking over as the key growth engine in B2C trade, with a Compound annual growth rate of 29.3% from 2014 to 2020, PayPal noted.

Photo: MTI / Zsolt Szigetváry

Prezi acquires online peer Infogram

Local Tesco workers eye strike, union warns Hungarian workers of the British-owned supermarket chain Tesco are planning to organize a demonstration and work slowdown unless the company starts raising wages, Hungarian governmentfriendly daily newspaper Magyar Idők reported on May 29. Pálné Buday, the chairwoman of the Union of Commercial Employees (KASZ), told the paper that workers at Tesco are dissatisfied because the Hungarian subsidiary of the U.K. retailer has not raised salaries since the mandatory raise in January. KASZ has reportedly entered a cooperation with the Independent Union of Commercial Workers (KDFSZ) to organize a country-wide demonstration in order to put pressure on the retail giant. In the near future, Tesco employees may slow down the workflow indoors and demonstrate outdoors in order to make the chain take action, according to reports. Such actions are planned to take place on days when traffic is busy in order to maximize the impact.

PayPal brings Seller Protection to Hungary PayPal is extending its Seller Protection program in Hungary, covering sellers with the full amount of their payment on eligible sales in cases of unauthorized payment, such as a hacked account or a buyer claiming not to have received an item ordered, according to a press statement sent to the Budapest Business Journal. The program has hitherto been applicable in Hungary to tangible goods only, but now it also applies to services (for instance, design, education or photography etc.), tickets (to concerts, shows, sport events, etc.), and

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Samsung’s electrifying investment Hungary’s Prime Minister Viktor Orbán and Samsung SDI CEO Jun Young-Hyun plant a tree on May 29 at the inauguration ceremony of Samsung’s HUF 100 billion electric vehicle battery plant in Göd, about 30 km northeast of the capital. The plant, established next to Samsung’s old cathode ray tube factory, which was shut down in 2014 as the technology was replaced, is expected to employ a staff of 600. Orbán said the country is aiming to put 63,000 electric vehicles (EVs) on the road by 2020, including 54,000 passenger cars. He promised to provide tax preferences for EV owners. Jeong said that the plant should reach full capacity by 2018, turning out batteries to power 50,000 electric vehicles.

Hungarian tech firm Prezi, which has become internationally known for its online presentation software, has bought Latvian online peer Infogram, which specializes in creating infographics, according to entries on the blogs of both firms. Launched in 2012, Infogram – based in Riga, Latvia, and San Francisco, the United States – claims to be a market leader in data visualization, and to have become “the web’s favorite data visualization tool thanks to its simplicity, functionality and strong design aesthetic”, according to the company’s website. Infogram boasts three million users and 50 million visitors monthly, while Prezi has 85 million users in more than 190 countries. Prezi has three offices in Budapest, San Francisco and Mexico City, employing a staff of 250. For the time being, the two products will be handled separately. “In the last few years, we’ve seen people choose Prezi over slides because they want to move people – to affect emotion, inspire action, and ignite transformation. With all the noise around us (updates, pings, bots), it’s increasingly hard to captivate people, but engaging visuals are almost impossible to ignore,” Péter Árvai, one of Prezi’s founders, wrote in the blog entry announcing the purchase.

OTP’s VC fund provides EUR 2 mln to Codecool OTP Bank’s venture capitalist affiliate PortfoLion Regional Private Equity Fund announced it will provide the Codecool programming school with a EUR 2 million investment, according to a press statement sent to the Budapest Business Journal. Through the capital injection Codecool aims to continue its international expansion. In the coming 12 months, Codecool intends to use the equity at its disposal to open two new schools abroad, thus expanding to 1,000 the number of junior programmers it trains in one year. According to the plans

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of the founders of the company, Codecool schools will be operating in 24 cities in Europe by 2022. PortfoLion Regional Private Equity Fund invests primarily in Hungarian SMEs that have already been running for a few years, can show stable operations and realistic business plans, and have promising, international growth potential. “Beyond the Europe-wide presence of market demands, another factor in favor of the investment is that, since its foundation, Codecool has rapidly proved the competitiveness of its educational program on the Hungarian market, and with the expansion into Poland it shows the flexible international adaptability of the training,” says György Simó, investment partner of PortfoLion Venture Capital Fund Management Zrt.

Eisberg Hungary turns out 130 tons of lettuce a week

Eisberg Hungary produces 130 tons of salad products a week and exports almost half of it, chiefly to fast food chain McDonald’s in Austria and other European units, according to a press release sent to the Budapest Business Journal. Almost 10% of the produced salad products are delivered to the Hungarian units of McDonald’s. Eisberg Hungary says that due to the short delivery routes in Europe, Hungarian-produced salad can reach the tables of people around Europe while still fresh. Eisberg Hungary started operating in the country almost 25 years ago, arriving here chiefly to become the supplier of the local McDonald’s chain. “The company with a Swiss background in the beginning exclusively focused on fulfilling the salad demands of the fast food restaurant, chiefly with iceberg lettuce, which was largely unknown in Hungary at that time,” said Eisberg Hungary CEO Zoltán Gazsi. The company spends HUF 14 million-15 mln a year on independent auditors in order to make sure the lettuce it turns out is free of GMOs and pesticides. “In order to provide impeccable quality, the suppliers need to do impeccable work, therefore only the best can meet the especially strict local requirements in agriculture,” said Zoltán Papp, leader of supply at McDonald’s Hungary. He added that in the majority of cases, hamburgers and salads sold in the restaurant come from domestic suppliers.

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travel (trips, flights and hotel bookings, etc.). “I’m really excited about this addition to our services. The decision to extend the Seller Protection program was made by PayPal to give its sellers assurance that they can leverage e-commerce on a larger scale and with greater confidence for more types of goods and services,” says Matt Komorowski, managing director for PayPal Northern & Central Europe. “These changes are an important step in providing our sellers with enhanced protection when using PayPal,” Komorowski added. “Knowing you’re covered if things go wrong should be a basic requirement when shopping and selling online.” The program helps Hungarian

2017. 05. 31. 18:44


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Business

WHO’S NEWS

www.bbj.hu

Budapest Business Journal | June 2 – June 15, 2017

Do you know someone on the move? /// Send information to news@bbj.hu

Hogan Assessments Names Hungarian Leader for Europe Zsolt Fehér has been named the leader of European operations at personality test developer Hogan Assessments. In his role, Fehér will be responsible for driving the growth of Hogan’s direct marketing and thought leadership campaigns across Europe. In addition, he will work with key European partners, distributors and multinational consulting companies to integrate Hogan’s solutions into current business offerings. With 20 years’ worth of experience in the consulting industry, Fehér has delivered numerous workshops on leadership, company and project management, public speaking, HR development, and corporate financial planning. Prior to joining Hogan, Fehér was the CEO of Assessment Systems International, one of Hogan’s most successful international distributors. “Zsolt Fehér’s professionalism and decade of experience as our distributor is testimony to his expertise and experience for this critical job,” said Hogan CEO Tomas Chamorro-Premuzic. “We have no doubt that he is a perfect fit for the role, and look forward to working with him,” the Hogan CEO added. “I consider it to be my career peak that I can lead Hogan’s growth efforts in Europe,” said Fehér. “Having worked kempi-BBJ-124x158-201705:Layout 1

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with Hogan for several years and seeing how their products have helped so many organizations, my goal is to make more and more European companies integrate Hogan solutions into their HR strategies.” Founded in 1987 by Drs. Joyce and Robert Hogan, the company leads the world in personality assessment and leadership development, according to its own website. With products and services in 56 countries and 47 languages, what began as a small startup has evolved into the industry leader serving more than half of the Fortune 500.

Invitel Group Welcomes Online Chief Dénes Éless has been named online chief at Invitel Group Hungary, taking effect from May. The group aims to develop its customers’ online experience and strengthen the brand digitally through the recruitment of the new leader. In the past ten years, Éless worked with the marketing team of Red Bull as a content manager and later a marketing specialist. He also spent several years as content manager of Red Bull Mobile. Chiefly, Éless will be responsible for overseeing Invitel’s digital presence as well as its continuous development, as the group has recently expressed a commitment to boost the customer experience on its digital platforms.

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The new chief will also focus on developing the functions of both residential and business online customer communications and the realization of online campaigns. “I find the tasks and challenges of this position exciting and motivating. Through the experiences I have gained at Red Bull, I will be able to manage campaigns from a new and exciting point of view, while I can learn about a new point of view thanks to Invitel and will be able to expand my digital marketing knowledge at the same time,” Éless said.

Cushman & Wakefield Names Office Head Tamara Szántó has been appointed head of office agency in Hungary at real estate firm Cushman & Wakefield with immediate effect. Szántó joined Cushman & Wakefield in 2010 as a negotiator and was promoted to associate in 2015. Her most recent appointment to lead the office agency department reflects “both her exceptional results delivered and experience gained from working on the Budapest office market over the past ten years,” Cushman & Wakefield says. She has been involved in many of Budapest’s notable office leasing transactions and will now head Hungary’s growing, marketleading team of five professionals. Szántó holds an MSc degree in economics and marketing from the University of Pécs. “Becoming a team leader is a great achievement and responsibility. I am confident, that Tamara’s in-depth market knowledge, experience and hardworking attitude will further help grow the business in the future. I wish her success in her new role,” said Gergely Pados, international partner, and head of Hungary at C&W.

Telenor Hungary Picks new CMO, Marketing Directors

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Petra Stangl has been appointed chief marketing officer at telco Telenor Hungary to head its marketing division, while two additional directors have been named for the division. Austrianborn Stangl has more than 15 years’ experience in the sector. She joined Austrian telecommunications incumbent Mobilkom Austria (today Telekom Austria) in 2000, where she held various marketing positions. She was responsible for customer loyalty, later appointed to head of consumer marketing. Stangl joined the Austrian-owned VIP Mobile in Serbia as CMO in 2010. In 2012, she took the role of international marketing director at Telekom Austria, leading and managing the company’s international marketing activities in CEE. In the past two years, Stangl worked as an independent business consultant for start-ups. In her new position, she will be responsible for the development of Telenor Hungary’s consumer postpaid and prepaid offers, the overall branding and positioning of Telenor, as well as the B2B sales and marketing units. She replaces Mike Michel as CMO, who left Telenor Hungary in January 2017. In recent weeks two new directors have also been appointed to take over the responsibilities of Lukas

Antos, who moved to Telenor Myanmar in December 2016. Mila Kusheva joins as consumer marketing director from Telenor Bulgaria, where she was consumer & SOHO marketing director. She has worked in telecoms for 13 years. She holds a bachelor’s degree in marketing, advertising and business relations, and a master’s degree in international relations and affairs from the University of National and World Economy in Sofia. Péter Civin is Telenor Hungary’s new brand and marketing communications director. He joined Telenor Hungary in 2013 and was responsible for digital services marketing and B2B marketing before his current assignment. Prior to joining Telenor, he held various positions at Microsoft in Ireland and Hungary between 2007 and 2012. He started his career at Kraft Foods.

Coca-Cola HBC Hungary Restructures Commercial Branch

The commercial branch of Coca-Cola HBC Hungary is being restructured, and the company is appointing two new people to two newly established positions in its management as of June 1. Zoltán Matskási has been appointed marketing operations leader. In his new position, he will be responsible for the execution and leading of customer and channel programs, as well as creating, executing and overseeing marketing plans. Matskási started his career at Mars in 1999, then moved to Nestlé Purina and later Nestlé Beverages in commercial and marketing positions. He joined Coca-Cola HBC Hungary in 2009, initially in commercial and market roles and later gaining sales and management experience as a commercial services leader. Gábor Ivády has been appointed commercial excellence leader. He started his career at Unilever and later moved to Reckitt Benckiser as channel marketing team leader. Soon after joining CocaCola HBC Hungary as channel marketing leader, he planned and implemented several promotion strategies at the firm, and played an important role in the establishment of price policy at the company. In his new position, Ivády will be focusing on category management and will also be responsible for research and analysis. Katalin Bányi, who is currently the commercial and marketing director of Coca-Cola HBC Hungary, is moving on to continue her career at the group’s Swiss subsidiary as commercial excellence leader. After her departure, the Hungarian firm’s commercial branch will be restructured, and her duties will be performed by three leaders: the aforementioned two new positions and the country sales director.

2017. 05. 31. 18:44


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www.bbj.hu

Budapest Business Journal | June 2 – June 15, 2017

A Guest Experience Better by Design

The Continental Hotel Budapest will celebrate the seventh anniversary of its reopening on June 15 with a client and partner golf party, but it is only the latest landmark for a building that has, in its time, been public bathhouse, musical theater and hotel. BBJ STAFF

The Continental is now part of a group that includes the Boutique Hotel Budapest, the first to be opened in 2006, and the Prestige Hotel Budapest, the latest addition, which opened in 2015. All are owned by Palestinian businessman Mazen Al Ramahi, who has lived in Budapest for more than 30 years.

Zoltán Géher, general manager. “We are fully booked, so we could not do anything here at the hotel, but in any case, we wanted to do something a little different,” explains general manager Zoltán Géher of the party. The Continental will take care of the catering, naturally enough, but at the party golf pros will be on hand to give lessons and tips for the guest competition, and there will be entertainment from a caricaturist, an astrologist, and a soap bubble artist. “It will run from 10 a.m. to 3 p.m. and is a family event; guests are welcome to bring their children along.” Being fully booked is something of a common theme for the hotel in its latest incarnation. Géher says average occupancy for the 272-room four-star superior

establishment is 85%. That will peak around the Formula 1 Grand Prix weekend in August at 94% but even in the traditional low-season month of February, he says it will be around 80%. It presents a welcome headache. “We do a deep cleaning of the rooms and soft maintenance from December to March, but this year we were not able to finish that. In the early years, we would close an entire floor at a time. Now we struggle to find five rooms we can do at once.”

Eye for Design The secret, Géher says, lies in the close working relationship he has formed with Al Ramahi. While the Hungarian has decades of

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hotel experience (he ran his own consultancy and had been part of the team that reopened the Corinthia Hotel Budapest, and was at the Forum during its three-year renovation and relaunch as the InterContinental Budapest), the owner has an eye for design, something that leaps out at you the moment you enter through the hotel’s giant brass revolving doors. It was Al Ramahi who had the vision of what the former Hungária Spa and Continental Hotel could become. Although the Dohány utca building was regarded as one of the iconic structures of Budapest’s traditional Jewish quarter, it had fallen on hard times, and had only just been saved in the 1990s from a previous owner’s plan to pull it down and replace it with high rise apartment block by the imposition of heritage building status. The Palestinian businessman acquired the building in 2008, and asked Géher, whom he had known from the Corinthia, to become GM and oversee the renovations and opening. Géher says he was initially skeptical, but soon realized “it would be hard work, but there was a good business to be made here. [.…] We opened in June 2010 and by August occupancy was already 81%.” Design touches are everywhere, from the bird’s eye view painting of Jerusalem behind the reception desk (symbolic of the fact that Al Ramahi is a Muslim, while the hotel is in the Jewish Quarter of a Christian country) to the contemporary sculptures in every room. The idea is to give guests a memory, an experience, not just another night in a standard hotel. But Géher brings a hotelier’s practicality to the business. “The main focus is on the guests; we cannot be profitable if the guests are not happy.”

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British Ambassador Visits Britannica International School The staff, students and parents of Britannica International School were delighted to welcome British Ambassador to Hungary, Iain Lindsay OBE and his wife Bridget on Friday, May 26. This was Mr. Lindsay’s first visit to the school, following his official arrival to Budapest last spring. After being greeted by school principal Neil McGarry, Mr. and Mrs. Lindsay received a tour of the school’s facilities alongside two of Britannica’s growing number of ‘Student Leaders’. Sophie, who was one of the students showing the Ambassador around, said: “The British Ambassador and his wife were very nice and friendly; it was a lot of fun walking around the school corridors with them. They liked our school facilities and they were amazed at how much playing space we have.” This was followed by a visit to the Primary Singing Assembly, where Mr. Lindsay awarded some very special Britannica Ambassadors certificates to students chosen because they epitomize the seven key Britannica qualities; resolution, independence, responsibility, inquisitiveness, respectfulness, globalism, and lifelong learning. Mr. and Mrs. Lindsay spent the second part of their visit within our thriving secondary department, learning about the Crime Map of Budapest in geography and programming Micro Bits in the newly upgraded ICT suite. Our Year 8 geographers have been investigating crime patterns in Budapest using the Hungarian Police online interactive map. Students have then been using Google street view together with further research to

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establish reasons for variations in crime rate and type by place. The Ambassador was introduced to Year 9 students working with Microbits. Microbit programming opens a bridge between computer programming and products where creativity comes to life. The students developed real world applications to technology including interactive mood badges, reaction timers and alarm systems. The Ambassador and his wife were invited to

discuss the ideas with the students and see some of the prototypes in action. As Mr. Lindsay commented: “Thank you for welcoming us to Britannica this morning, we have really enjoyed our visit and look forward to coming back soon.’ We are very grateful to Mr. and Mrs. Lindsay for taking time in their extremely busy schedule to come to visit us here at Britannica. Britannica International is recognized as

one of the leading international schools in Hungary, providing the highest level of British International Education within a rich intercultural learning environment. The school became a member of the Orbital Education group of schools in 2008. Today it is a thriving school for almost 400 students, aged from five to 18. Orbital Education, based in the United Kingdom, is one of the leading international school groups, with ten schools around the world.

2017. 05. 31. 18:44


Business

10 | 2

www.bbj.hu

Budapest Business Journal | June 2 – June 15, 2017

British Chamber Elects new Council Vazul Tóth, the head of quality management at Budapest Bank Zrt., was reelected chairman of the British Chamber of Commerce in Hungary in an uncontested election at its annual meeting on May 24. BBJ STAFF

“It is an honor to be reelected and given the opportunity to continue to serve our members,” Tóth said. “I am delighted that now, as the U.K. redefines its relationships with the EU, our members have elected representatives of significant British companies operating

interests and for the U.K.’s success and prosperity.” The annual meeting at the Budapest Marriott Hotel also included a speech by the ambassador and a report by Oliver Strommer, head of the British Business Center. In addition, there was a moderated discussion with András Sztaneff and Anna Fehér, two students participating in the BCCH-uSchool Entrepreneur Program, conducted by BCCH vice-chair Kinga Kalocsai, and a roundtable discussion called “Managing Change: How do we operate in the fast changing world?” That featured panelists Eric Bentz, general manager of consumer health at GSK Hungary & Adriatics, Péter Baldaszti, co-owner and CEO of women’s fashion brand Nanushka, and Antal Kerekes, partner at PwC Hungary, and was moderated by the BBJ’s editorin-chief, Robin Marshall. The evening also saw a

The new ruling council of the BCCH.

in Hungary to our new council. Over the next period, more and more emphasis will be placed on strengthening bilateral synergies. The council is determined to play a key role in redefining and facilitating the new relationship between the U.K. and Hungary.” In an exclusive interview with the Budapest Business Journal published on November 11, 2016 (Opportunities in Challenges: BCCH at 25), Tóth, who was first elected to the chairman’s position in 2013, indicated he would not be able to stand again. A change in the chamber’s charter, however, allowed him to seek reelection. The new BCCH Council, under Tóth’s leadership, is comprised of: Árpád Balázs (PwC Hungary); Zsolt Bella (BT Global Services); Dennis A.

Diokno (FirstMed); Judit Iglódi-Csató (GSK Hungary); Kam Jandu (Budapest Airport); Kinga Kalocsai (GE); Christopher Noblet (Partos & Noblet in co-operation with Hogan Lovells); and Andrea Tóth (British Automotive).

Dynamic Chamber

donation of

HUF 240,000

Iain Lindsay OBE, the United Kingdom’s ambassador to Hungary said: “I welcome an even more dynamic chamber that is even more prepared to provide direct support to British business in Hungary. I and my team at the embassy will work more closely with you to achieve our common goals. We want to deepen our relationship with the chamber and work together with you for British economic and business

handed over to the BCCH’s nominated charity, the National Ambulance Service Foundation, which was gratefully received by Dr. Gábor Csató, chief executive director of the Hungarian ambulance service. Twenty-five percent of the participation fees of the chamber’s CEO Dinners series is set aside for the donation.

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2017. 05. 31. 18:44


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Budapest Business Journal | June 2 – June 15, 2017

Business

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Growth to be Unleashed in the Hungarian Tourism Market With guest nights up by 41.3% since 2010, tourism in Hungary is on an exponential growth track. Record funds promise even more, including attempts to make visitors more aware of the other delights the country has to offer beyond the capital, as Dr. Zoltán Guller, CEO of the Hungarian Tourism Agency (MTÜ) tells the Budapest Business Journal.

I have four children, so I have learned to appreciate that high chairs in a restaurant or coloring books in a visitor center can work miracles! Familyfriendliness is very important since ever more families travel together, sometimes even with the grandparents. It is not by accident that the guest nights in Budapest of foreign visitors grew by 54% between 2010 and 2016. Many are discovering the city for themselves and security is another asset that is ever more appreciated. Our double goal, namely to ease the territorial concentration of tourism and to make visitors stay longer, makes it necessary to make foreign residents, including expat executives of multinational companies or students from abroad, aware of the hidden treasures of the countryside. Our soon-to-come campaign targeting domestic tourism is set to focus on this aspect, apart from developing the primary destinations of Hungary.

LEVENTE HÖRÖMPÖLI-TÓTH

Tourism makes up 10% of Hungarian GDP at the moment, and that could reach 16% by 2019. There seems to be no shortage of funds to make that happen. What key areas are being targeted in this effort? Indeed, unprecedented amount of funds, some HUF 500 billion, are at our disposal for development purposes for the period through to 2020. The first funding schemes are scheduled to be accessible for these development projects Dr. Zoltán Guller, CEO of the Hungarian Tourism Agency.

It is tourists, after all, who decide whether or not to visit Hungary and spend their free time and money here. Therefore, their needs must be met and they should be provided with a range of experiences that make them want to choose us. soon, with dozens of billions of forints earmarked in the central budget for this and the upcoming year. These resources will be used by MTÜ in primary tourism locations in a focused way, as part of a professionally crafted strategy. So far three such regions have been designated by the government (Balaton; SopronFertő; and Tokaj-Felső-Tisza and Nyírség) with more to come by the end of the year. What does the sector expect of MTÜ, and how can you help market players forge closer cooperation for the benefit of the entire industry? I am convinced that governmental

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development coordination needs to measure up to the visitors, not the tourism industry itself. It is tourists, after all, who decide whether or not to visit Hungary and spend their free time and money here. Therefore, their needs must be met and they should be provided with a range of experiences that make them want to choose us. Through the calls for proposals for providing the new funding schemes for tourism development, these objectives are to be achieved more easily. I believe the sector appreciates that comprehensive and long-term focused work has begun at MTÜ at last, and our efforts aim to enhance our competitiveness. For that to happen both services and attractions need to be taken to the next level, which is essential to generate substantially more revenues too. The quality of infrastructure and services need to improve simultaneously, so that visitors will want to open their wallets, whilst cooperation between local service providers needs to be strengthened at a higher level as well. It should become self-explanatory that, in any given region, service providers and those running attractions cross-reference one another.

This is also a zero-sum game where everyone, including the guest, wins: they should return later or stay longer than planned. This can result in an exponential growth of tourism-related revenues – and that is what our primary goal is. Are families to be specifically targeted? One often has the feeling that they are seen rather as of secondary importance. I have four children, so I have learned to appreciate that high chairs in a restaurant or coloring books in a visitor center can work miracles! Family-friendliness is very important since ever more families travel together, sometimes even with the grandparents. The HORECA sector, therefore, must adapt. Growth is being fed by domestic and foreign tourists alike, as guest nights associated with both customer groups have risen by nearly 7% from 2015 to 2016. However, guests from abroad still tend to stick to the capital: two-thirds of them overnighted there in 2016 and nearly 75% of all foreign guest-related hotel spending took place in Budapest. How can this Budapest-centric attitude be changed?

China is now among the top ten source countries where most tourists to Budapest arrive from. Do you have anything tailor-made in the pipeline to fulfill their special needs? In the past two years the newly launched direct flight to Beijing has propelled China to this key position. The first four months of 2017 bear witness to uninterrupted interest. The point is to target quality Chinese tourism. Among the latest buzzwords now are our spa and festival cultures, which attract many from China thanks to changing travel habits there. Not only the wealthy middle class, but also young travelers can be targeted with success, not least thanks to the effect of star-studded Chinese movies that have been shot here recently. MTÜ is also actively engaged in negotiations over launching regular flight routes to Shanghai and Ningbo. The Olympic bid is off the table, but other large-scale sports events will be held in Hungary to compensate for hoped-for revenues. Will hotel and infrastructure capacity be able to handle the elevated pressure? This summer only shows the potential impact of international sports events on tourism. In July, the FINA World Aquatics Championship and the FINA Masters World Championships will start and estimates project that hotel room rates will increase by an average of 25% because of it. A sports event with such audience figures worldwide can boost the country image enormously. Thanks to the sports tourism that will be triggered by the newly built infrastructure, new target markets and segments can be won over for Hungary. Professional support for the organizing of premium international sports events in Hungary ended up in the recently extended task list of MTÜ with reason!

2017. 05. 31. 18:44


Gruppo T.F.M. KFT. 1068 Budapest, Király u. 102.

1st District

3rD District

4th District

7th District

62 sqm – 3 rooms, Logodi street

24 sqm – 1 room, tímár street

106 sqm – 3 rooms, türr istván street

70 sqm – 3 rooms, rUmbacH sebestyén str.

At the bottom of the Buda Castle, in a quiet area, this completely renovated, very sunny, well divided apartment has separate rooms and private gas heating.

This very quiet small apartment benefits of sleeping gallery and it is situated within a condominium in good condition. Good connection to public transport.

In a quiet, garden suburb area, this duplex apartment in good condition has 2 bathrooms, private gas heating, terrace and private little garden.

Adjacent to Madách Square and the famous “Gozsdu Courtyard”. Completely renovated apartment which benefits of a large balcony and a fully fitted kitchen.

46.900.000 HUF

14.500.000 HUF

27.500.000 HUF

+36.1.201.0403

1st District

+36.1.430.1403

3rD District

+36.1.782.7275

5th District

47.500.000 HUF

+36.70.3156.087

10th District

12th District

15th District

140 sqm – 4 rooms, szécHenyi HiLL

76 sqm – 3 rooms, rákospaLota

Nice panorama from the terrace, this very well divided apartment in good condition has separate rooms, balcony, garage and parking space. It is located in the very quiet Buda Hills.

This family house in good condition built on 365 sqm of lot, has 13 sqm of terrace, parking space and well kept garden. It is located a quiet street.

120.000.000 HUF

39.900.000 HUF

+36.1.789.2846

13th District

+36.70.398.8754

15th District

151 sqm – 5 rooms, aLadár street

52 sqm – 2 rooms, madzsar JÓzseF street

93 sqm – 2 rooms, semmeLweis street

97 sqm – 5 rooms, ÓHegy street

38 sqm – 1 room, doLmány street

215 sqm – 6 rooms, garden sUbUrb

This completely renovated, luxury, duplex, mansard apartment benefits of 2 bathrooms and panoramic view over the Buda Hills. It is situated within a renovated building with elevator.

This completely renovated, high floor apartment has separate rooms, very bright kitchen and nice view from the two balconies. It is situated in a renovated condominium with 3 elevators.

This completely renovated, spacious apartment has living room with fully fitted open kitchen and bedroom. It is situated within a very nice period building, close to the Astoria.

In a new built building with nice common garden, this very bright, duplex apartment benefits of living room with fully fitted open kitchen, 4 separate bedrooms, balcony and garage.

18.200.000 HUF

52.900.000 HUF

In a quiet street, this 2 storey family house built on 420 sqm of lot, has 2 bathrooms, 2 balconies, terrace, garage and parking space in the garden.

119.000.000 HUF

65.000.000 HUF

Nice view over the Buda Hills, this very bright, top floor apartment has open kitchen and it is situated within a new building with elevator, in the garden suburb area of the district. 18.990.000 HUF

44.990.000 HUF

+36.1.201.0403

2nD District

+36.1.379.0506

3rD District

+36.1.287.6745

5th District

+36.70.646.6818

10th District

+36.70.455.8062

13th District

+36.70.398.8754

16th District

72 sqm – 2 rooms, érmeLLéki street

235 sqm – 6 rooms, békásmegyer-ÓFaLU

96 sqm – 2 rooms, kossUtH LaJos street

288 sqm – 8 rooms, ÓHegy street

74 sqm – 4 rooms, angyaLFöLd garden sUb.

70 sqm – 2 rooms + HaLL, páLya street

In a quiet and green side street, this very bright, garden facing apartment in good condition has separate rooms and private gas heating. It is situated within a beautiful villa house.

In a quiet area, this very spacious, two storey family house has private gas heating, underfloor heating, air conditioning system and 2 car garage.

In an eclectic style period building with elevator, this high floor apartment has nice view over the Ferenciek Square, separate rooms, balcony and private gas heating.

This two storey family house built on 1126 sqm of lot, has 2 kitchens, 3 bathrooms, terrace, 2 car garage and it is located next to a beautiful park.

This completely renovated, garden facing apartment in good condition has balcony and it is located in very quiet and green area.

This well divided and sunny semi-detached house built on 600 sqm of lot, has separate rooms, garage and nice garden. It is located in a quiet area.

54.900.000 HUF

59.000.000 HUF

79.900.000 HUF

66.900.000 HUF

26.900.000 HUF

27.900.000 HUF

+36.1.336.1706

2nD District

+36.1.379.0506

3rD District

+36.1.287.6745

6th District

+36.70.646.6818

11th District

+36.70.455.8062

13th District

+36.1.612.5475

Dunakeszi

240 sqm – 6 rooms, Hideg street

121 sqm – 4 rooms, rÓmaiFürdő

38 sqm – 1 room, benczúr street

117 sqm – 4 rooms, nándorFeJérvár Lane

50 sqm – 2 rooms, pozsonyi street

74 sqm – 4 rooms, FÓti street

This two storey family house in good condition built on 1000 sqm of lot, has 35 sqm of terrace, balcony, 2 kitchens, 2 bathrooms and garage. It is located in a quiet and green area.

This renovated, duplex apartment benefits of fully fitted kitchen, fireplace, air conditioning system, 2 bathrooms, 2 balconies and terrace. In a condominium with nice common garden.

Breathtaking panorama over the Buda Hills, this very sunny, top floor apartment is situated within a Bauhaus style building with 2 elevators, in a beautiful, quiet and green street.

In a very quiet street, this very spacious, duplex apartment has private gas heating, 2 bathrooms, balcony and garage. It is situated within a building with nice common garden.

This very bright, high floor apartment, that needs renovation, has panoramic view over the Buda Hills, and it is situated within a nice period building with elevator.

This very bright, street facing apartment has separate rooms, balcony and air conditioning system. It is located in a quiet area. Good connection to public transport.

69.000.000 HUF

64.900.000 HUF

30.500.000 HUF

49.900.000 Ft

33.900.000 HUF

17.900.000 HUF

+36.1.376.6080

2nD District

+36.70.669.5350

3rD District

+36.1.351.0446

+36.1.720.2433

+36.70.414.7759

+36.70.399.0399

6th District

11th District

126 sqm – 2 rooms + HaLL, érmeLLéki str.

140 sqm – 3 rooms, rÓmai-part

63 sqm – 2 rooms, nagymező street

80 sqm – 4 rooms, péterHegyi sLope

132 sqm – 3 rooms + HaLL, úJpesti qUay

65 sqm – 3 rooms, meder street

Beautiful panorama over the Buda Hills, this spacious apartment, that needs renovation, has 2 balconies and garage. It is situated in an art deco style building, in a quiet side street.

View over the Danube, this very spacious and bright, luxury apartment has fully fitted kitchen, 2 bathrooms, 2 balconies and it is situated in a new built building.

This sunny apartment is fully renovated, and situated within a nicely renovated, period building. Only a few steps away from the tree lined Andrássy Boulevard.

In a new built building with geothermal heating, this very bright apartment benefits of living room with open kitchen, 3 separate bedrooms, 2 balconies and garage.

87.000.000 HUF

69.400.000 HUF

Panorama over the Danube, this completely renovated, high floor apartment has separate rooms, private gas heating and it is situated within a renovated period building with elevator.

In a new building, this bright, street facing mansard apartment in good condition has living room with open kitchen, 2 bedrooms and private gas heating.

38.900.000 HUF

59.900.000 Ft

119.000.000 HUF

20.900.000 HUF

+36.1.336.1706

2nD District

+36.70.669.5350

4th District

+36.70.3156.087

7th District

+36.1.720.2433

12th District

13th District

+36.70.414.7759

14th District

Dunakeszi

+36.70.399.0399

Pilisborosjenő

221 sqm – 8 rooms, csévi Lane

35 sqm – 2 rooms, Lebstück mária street

57 sqm – 2 rooms, marek JÓzseF street

130 sqm – 4 rooms, stromFeLd aUréL str.

55 sqm – 2 rooms, Herminamező

200 sqm – 5 rooms, piLisborosJenő

Nice view over the Buda Hills from the 2 balconies, this very sunny family house consists of 3 separate apartments. It is located in a quiet side street.

This very bright, high floor, street facing apartment in good condition has separate rooms, fully fitted kitchen and it is situated in a building with elevator.

In a period building with original features and the famous Zsolnay tiles in the staircase, this quiet apartment benefits of a fully fitted kitchen, private gas heating and air conditioning system.

This very bright apartment, that needs renovation, has covered terrace, direct connection to the common garden and it is situated within a small condominium built on 800 sqm of lot.

This very sunny, well divided, street facing apartment in good condition has private gas heating and it is situated in a well maintained condominium with common garden.

In Pest county, this three storey family house has beautiful view from the 2 balconies, separate rooms, 2 bathrooms and well kept garden.

135.000.000 HUF

14.900.000 HUF

32.500.000 HUF

69.000.000 HUF

19.900.000 HUF

+36.1.376.6080

+36.1.782.7275

+36.1.351.0446

+36.1.789.2846

+36.1.612.5475

78.000.000 HUF

+36.1.430.1403

each agency independently owned and operated. • these offers are valid, till the apartments are sold. • these information do not constitute a contractual element. tecnocasa_bbj_2017_06.indd 1

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Budapest Business Journal | June 2 – June 15, 2017

Special Report Legal Market International Law Firms Working Hard to Serve14 The Mixed Blessings of AI 15 In Search of New Legal Blood16 Investing in Talent and Technology 29

Law firms face an extremely competitive market, even as they battle for new talents and seek to embrace AI BBJ_2511_special_report.indd 13

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Special Report

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Budapest Business Journal | June 2 – June 15, 2017

‘Worth Every Drop of Sweat’ – Hungary’s International law Firms Working Hard to Serve

International law firms in Hungary are doing well enough. Despite some headaches over the shortage of committed workforce supply and a little moaning about the rapidlychanging regulatory environment, the biggest firms are not afraid of losing their market positions. How can their efficacy be further increased and what challenges are expected? ÁGNES VINKOVITS

Hungary’s legal system has faced fundamental changes in the past years – there seems to be no debate about this among the country’s leading law firms. Dozens of altered financial and procedural regulations as well as the new Civil Code in 2016 pose challenges not only to businesses but also to law firms. “Unpredictability is probably unwelcome by the entire legal market while it also draws back the country’s competitiveness,” András László at Szecskay Attorneys at Law points out to the Budapest Business Journal. Still, most legal offices see the changes as an inevitable process and believe that stability will arrive sooner or later. Investors, indeed, saw higher risks in the lawmaking dump between 20102014, which pushed law professionals to make even stronger efforts to keep their knowledge up-to-date, says Csilla Andrékó, managing partner at Andrékó Kinstellar, adding that legislation still runs at a relatively high speed but it is more of a challenge than a disincentive. “We have to go through these stages that, we hope, will finally deliver a legal system that meets modern requirements,” Zoltán Hegymegi-Barakonyi of Hegymegi-Barakonyi és Társa Baker&McKenzie says.

BBJ_2511_special_report.indd 14

András László, Szecskay Attorneys at Law

Péter Lakatos, Lakatos, Köves and Társai. Regarding the spectrum of work, the nine major law firms the BBJ has interviewed have not reported any drastic changes in the past year. Though, as legal tasks usually reflect the general economic tendencies, real estate and finance practices show particularly positive trends. Cross-border M&A transactions and deals in fields that are strongly connected to subsidies, such as renewable energy, are also said to be on the rise. Advisory work on data protection is also of increasing popularity as the EU’s General Data Protection Regulation will come into effect just in one year’s time. Having such an open professional playing field requires a good range of qualified employees. Finding the best new supplies might be even a bigger challenge on the legal market than elsewhere.

Quality, not Quantity While law firms mostly agree that schools deliver a high number of graduates every year, they also stress that quality should come ahead of quantity. “Volume is one thing, but we have always been targeting those entrants, who have an interest in economic law and are committed, talented, ambitious and foreign languagespeaking,” Péter Lakatos at Lakatos, Köves and Társai says. “It is increasingly difficult to find those who are really wellprepared and ready to work hard, invest time and energy into their professional development,” he adds. István Réczicza, the leading partner of Dentons’ Budapest office sees this fact as partly a result of lawyer education still

András Szecskay, Szecskay Attorneys at Law

Zoltán Hegymegi-Barakonyi, Hegymegi-Barakonyi és Társa Baker & McKenzie.

Jánós Tóth, Faludi Wolf Theiss. lacking a practical focus. Still, it is inevitable for Dentons, too, to keep finding the best ones as “the human factor plays the biggest role in the practice of law,” he points out. The generation gap is also often mentioned as a headache. “Workplace expectations of ‘Millennials’ or ‘Generation Z’ associates pose quite a pack of challenges to law firms, which are fiercely competing for those handful of most brilliant, who are hence not really competing with the great majority of law school graduates,” János Tóth, partner at Faludi Wolf Theiss says. Konrád Siegler, partner at Weil, Gotshal & Manges agrees. “The new lawyer generations have different preferences and lifestyle needs than those who graduated one or two decades ago,” he says adding that law is,

Csilla Andrékó, Andrékó Kinstellar.

István Réczicza, Dentons. at the same time, still clearly among the most prestigious professions. However, young professionals, Siegler explains, encounter fewer opportunities nowadays than in the past couple of decades. For example, it is much more difficult to become a partner at an international law firm than 10-15 years ago, as “the Hungarian legal landscape has become generally much more competitive since then,” he says. Yet, nothing is impossible. Áron László, who started to work with Oppenheim during his final university years, was elected a partner of the company this year. Oppenheim employs a paralegal program including a summer student scheme and is present at the job fair of Eötvös Loránd University, where it has developed a unique case study based contest, which requires creativity and high English language skills. Andrékó Kistellar also seeks talents among students. The firm has an internship program, where “undergraduates can prove their professional capabilities through real work,” Andrékó says.

Early Birds From School Good professional prospects come only to those who start building their career during law school, according to Gabriella Ormai, managing partner at CMS Cameron McKenna. “A CV with an internship at an international law firm or at a reputed company, topped with a semester abroad or some foreign work experience can multiply opportunities,”

2017. 06. 06. 13:00


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Budapest Business Journal | June 2 – June 15, 2017

Special Report | 15

Konrád Siegler, Weil, Gotshal & Manges.

Gabriella Ormai, CMS Cameron McKenna.

Ulrike Rein, Oppenheim.

Zoltán Marosi, Oppenheim.

she says. Lakatos also notes the importance of international experience. “Everyone should go and gain some foreign experience,” he suggests, although he also acknowledges the risk of losing capable workforce this way. “Really ambitious souls and intelligent minds need permanent challenges,” he says, adding that Hungary is too much on the periphery to be able to offer the same scale of exciting cases as some other countries. Still, given the significant differences among the various legal systems and the rigorous qualification requirements, legal diplomas are not as painlessly transposable as some others, and so workforce migration does not really affect this profession. Yet, the staff in Hungary’s offices is usually international. All the big law firms employ some foreign colleagues, too, in order to be able to handle crossborder cases at the highest professional standards. This practice often has further benefits too. “Our managing partner, for example, comes from Austria and we are indebted to her for one of our longest and most popular office traditions: The annual ski holiday organized every winter in our Western neighbor,” Oppenheim’s partner Zoltán Marosi explains. Keeping the legal

language as simple and understandable as possible is an aim among some major firms. “An easily understandable legal language is a key to ensuring equal access to justice for all,” points out Ulrike Rein, partner at Oppenheim’s Budapest office. Still, legal texts often have to be translated from Hungarian to Hungarian, she complains. A partner of Szecskay was once even half-jokingly asked if he really was an attorney as the client, otherwise highly qualified in non-legal fields, was so surprised about being able to understand every word the lawyer said about the given regulatory issue.

Barakonyi points out. At the same time, Wolf Theiss’ Tóth already sees the new Hungarian Civil Code as a good example for understandable language: it “offers rules formulated with everyday words wrapped in simplest grammar. It’s an effort worth every drop of sweat,” he says. However, Réczicza warns that the aim for simplicity should never reach disrespectfulness or reduce professional standards or exactitude. Siegler even says that complex legal concepts require specific and precise vocabulary. “Legal parlance nowadays is accessible and understandable enough for legal professionals, but will never be fully simplified for laymen,” he says. The idea of reducing bureaucracy has been on the government’s table for several years. Most recently, the National Competitiveness Council recapped the results on its May 18 meeting, and also set new targets including the revision of legal fees. “Simplifying legal practice, rationalizing procedures and so making them more costeffective is vital in both regional and global competition,” Hegymegi-Barakonyi says. Others, however, underline that legal fees in Hungary are considered low by European comparison and, most importantly, are set

by competition rather than central will. If speaking about fee regulation, Réczicza would rather suggest the inauguration of a minimal fee instead of maximizing prices. When it comes to the level of bureaucracy, while some even doubt that it has a downward tendency as, according to Réczicza, “lawmaking has to react to an increasingly complex economic environment,” and often, as Szecskay’s László points out, “one bureaucratic verification procedure is followed by another and the related regulations keep changing quicker and quicker,” others stress that efforts to reduce red tape are highly welcome. “Simplifying administrative procedures and cutting back bureaucracy, an effort much awaited in Hungary since the fall of the Iron Curtain basically, is not something against practitioners in law,” Tóth points out. Also, law firms are not afraid of losing markets as a result of a simpler legal environment. Moreover, “the increased competitiveness of Hungary due to less bureaucracy is in our best interest, too,” says Ormai, as the resulting higher productivity of the country and increased investor activity mean more opportunities for law firms too.

Legal Jargon Ormai agrees. “It is not the overuse of legal jargon that will prove that we are credible and genuine professionals, but the fact that we are speaking our clients’ language: That is how well we know their business and understand their business needs” she says. Staying clear is “a challenge for both lawmakers and lawyers, especially at times when people hardly read texts which are too long to fit the screen of their smart phones,” Baker & McKenzie’s Hegymegi-

The Mixed Blessings of AI and Technology

Major law firms all aim to take advantage of advanced technology. Some of them even develop software themselves to support internal organizations as well as to manage legal tasks. According to János Tóth at Faludi Wolf Theiss, for certain practical reasons in the CEE region, such as the plethora of local languages, the quality of legal documentation available, and the lack of standardized contracts, new technologies have not affected Hungarian lawyers as directly as their U.S. or U.K. colleagues yet. Even so, “those tech solutions will creep into our CEE transactional work gradually.” Wolf Theiss has already been deploying quite a number of those, but it expects the avalanche still to come. “We do our best to keep our advantage in this field too,” says Péter Lakatos of Lakatos,

BBJ_2511_special_report.indd 15

Köves Társai when speaking about TimeMind, his company’s custom-built management tool, which is capable of time and disbursements recording and multicurrency billing, and also functions as a full-fledged document management system. The software is especially designed for law firms with the aim of boosting the efficiency and profitability of the legal practice. Zoltán Hegymegi-Barakonyi of Hegymegi-Barakonyi és Társa Baker&McKenzie agrees about the importance of keeping pace with digitalization. “The competition among law firms will depend on how successful the companies are in innovation and in using advanced technologies,” he explains. Baker & McKenzie has 24 law apps, 16 of them completely unique, which “enable quick and cost-efficient management of the increasingly complicated global transactions and cases such as the management of intellectual property, merger control, data protection as well as of an entrance to foreign stock exchanges or in the case of official raids,” HegymegiBarakonyi says. Szecskay Attorneys at Law, in addition to using partly or fully automatized

management and client service systems, last year won the Wolters Kluwer Legal Award as the “Best Legal Team in Competition Law” as a result of launching a legal compliance platform.

State-of-the-Art Oppenheim uses “state-of-the-art forensic software” to review large amounts of electronic documents in antitrust, compliance or fraud investigations which it finds “extremely helpful if there is a need to quickly find a ‘needle in a haystack’ in urgent cases such as a leakage of confidential business information or the allegation of anti-competitive conduct.” CMS Cameron McKenna is Europe’s first law firm to apply a platform that integrates machine learning and data visualization techniques. Brainspace, described by Gabriella Ormai as “one of the most innovative pieces of software on the market”, speeds up data analyzing and the revision of documents in the cases of litigation files, arbitration and due diligences. However, as Dentons’ István Réczicza points out, technological development

might have unfavorable effects, too. The very processes which are traditionally conducted by new graduates are now being robotized, while the revision of long and heavy contracts has been an important stage of educating young lawyers at offices. “Today’s law firms have to face the challenge of finding other ways to make entrants fit for future independent work,” he explains. Still, Dentons not only develops software itself but is the first law firm in the world to have its own IT development company. Nextlaw Labs already has noteworthy projects. Beagle, for example, is able to find those parts of scanned contracts that have legal and commercial importance in no more than a few seconds, while it also draws attention to related risks. At the same time, Ross Intelligence is an artificially intelligent system giving professional, yet widely understandable answers to legal questions that are also put in everyday language. “At the moment, it covers only some fields of U.S. law, but it is already apparent how extremely it facilitates and speeds up legal work,” Réczicza says. Ágnes Vinkovits

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Budapest Business Journal | June 2 – June 15, 2017

In Search of new Legal Blood

EXPERT OPINION

Revival of the Employee Stock Ownership Plan in Hungary Dr. Eszter Kamocsay-Berta, LL.M. Managing Partner KCG PARTNERS HUNGARY

Background – The History of the Principle of Self-Regulation in Hungary Hungary’s Act XLIV of 1992 on the Employee Stock Ownership Plan (the “ESOP Act”) allows employees to acquire an ownership stake in their employing company by means of an organization established on the basis of the principle of self-regulation. The purpose of this legal instrument was to boost a company’s economic performance by bringing together the ownership and co-workers’ collective interests. However, the ESOPs established in the ’90s ceased to exist after a dynamic initial period, which might be explained by the fact that several benefits related to the ESOP were abolished Seismic Shift in Hungary – the New ESOPs The amendment of the ESOP Act by Act CLXXXVII of 2015 established a new form of ESOP operating with centralized management. As a result of the amendment, financial institutions, insurance companies, and investment firms may also launch an ESOP with the aim of managing rights on financial instruments for the benefit of the employees within the framework of the remuneration policy. This opportunity may well lead to the widespread use of ESOPs. Depending on which employees are covered by the ESOP, the personal scope might be extended from the managers to all employees of the company and its subsidiaries within the company group. If the ESOP is based on securities representing shareholders’ rights, the employees do not necessarily become owners of the founding company that established the ESOP, but acquire membership shares in the ESOP organization, which itself becomes owner of the founding company. Upon meeting the conditions set in the remuneration policy, the employees may exchange their membership in the ESOP organization for cash or securities or for a combination of these. According to the mandatory rules of the act, ESOPs may only be established for the purpose of facilitating employees in acquiring an ownership stake in their employing company.

BBJ_2511_special_report.indd 16

This implies that ESOPs can only be based on instruments representing shareholders’ rights; simply holding bonds or other instruments that do not represent rights similar to shareholders’ rights is not in compliance with the mandatory law. In addition, payments must generally be dependent on the yields of the instruments allocated to the ESOP organization. As such yields can comprehensively be established and validated by the annual financial report of the company providing the instruments, it is best practice to let the instruments be held by the ESOP organization for a minimum of one year.

Leading law firms do not always find it easy to sign top fresh graduates as they have a shrinking talent pool to choose from and candidates lack practical knowledge.

LEVENTE HÖRÖMPÖLI-TÓTH

The legal profession is still very prestigious in Hungary, so it remains an appealing career path for young talent, DLA Piper says, expressing the widely shared sentiment of the industry. However, major market players have diverging opinions over the difficulty of attracting the very best. It certainly did not help that back in 2012 legislation dramatically cut the number of government financed university places available for law students. As a result, last year less than 6,000 applied for legal studies, a

QATAR AIRWAYS

PASSENGER GROWTH BASED ON NUMBER OF CARRIED PASSENGERS

High Hopes – ESOPs from an International Perspective From an international perspective, ESOPs could be a major economic growth factor in Hungary. In the United States, for instance, roughly 7,000 ESOPs were launched before 2015, in which approximately 13.5 million employees were involved, owning more than 8% of American corporate assets. According to U.S. surveys, companies launching ESOPs can expect an extra profit growth of 2.3-2.4% annually, reflecting the extra motivation arising from the participating employees and managers. Although the newly introduced ESOPs are still in their birth phase in Hungary, the above figures project high hopes for this entirely recent legal institution. Competitive Advantage – the Main Advantages of an ESOP-Based Remuneration Policy The revised ESOP legislation significantly encourages a “stakeholder” approach from employees while control remains with the employer over the instruments provided to the ESOP organization. In addition, it ensures favorable taxation compared to the traditional form of share transfer programs; i.e., payments made to the employees within the ESOP are solely subject to a 15% personal income tax, meaning 18.5% savings by the employees on one hand, while the employers can reduce their public burdens by 23.5% on the other hand.

Gábor Papp, Head of Professional Development, Horváth & Partners DLA Piper.

60% drop

compared to the 2011 figures of 16,000. The number of admissions also dived from 8,000 to 2,500 during the same time span. Even more alarmingly, now only 8% of all law students accepted at university enjoy tuition-free education, with the rest forced to shell out hundreds of thousands of forints per semester. The effect of this is that the talent pool has shrunk not only in terms of numbers, but people tend to be selected rather by their parents’ financial means than their own interest or capabilities. European statistics simultaneously hint that those 2015

SOURCE: QATAR AIRWAYS

12,000 students

currently studying at the eight different law schools in the country are far from +10% an oversupply of law graduates. creating In the EU, the average law student ratio in higher education is still twice as much as the 4% figure in Hungary. The experience of leading international law firms in Budapest differs, though, when it comes to committing the best to join their ranks. At Ormai & Partners CMS Cameron McKenna, it is seen as a serious issue, especially now that it is ready to expand after its recent merger with Nabarro and Olswang. Finding the right candidates is far from easy, not least because the number of applications is below expectations to start with. Those who do get invited for an interview often disappoint because of their lack of preparedness. 2016

NUMBER OF LAW

STUDENTS

All in all, it gives priority to the company’s long-term business goals over the employees’ shortterm interests in a way that ensures employees’ performance is rewarded in accordance with the company’s business performance. 2011

www.kcgpartners.com

2015

16,000 STUDENTS APPLIED FOR A UNIVERSITY PLACE

LESS THAN 6,000 STUDENTS APPLIED FOR A UNIVERSITY PLACE

8,000 STUDENTS WERE ADMITTED

2,500 STUDENTS WERE ADMITTED

SOURCE: HUNGARIAN LAWYER EDUCATION IN 2015 THE SITUATION OF FACULTIES OF LAW BY ZSOLT KÖRTVÉLYESI

2017. 06. 06. 13:00


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Budapest Business Journal | June 2 – June 15, 2017

Dr. Gergely Légrádi, partner of DLA Piper.

understandably have been focusing on mastering it at a high level, and it is increasingly hard to track down people with sound knowledge of another foreign tongue. “For the young, salary is a big issue, so many do postgraduate degrees or complete an additional undergraduate one, possibly abroad, to stand a better chance for having a well-paid job or launching their own business. Or they try their luck in a richer country,” Nagy notes.

Clear Vision

Dr. Vera Nagy, a senior attorney at Simonfay & Partners.

Internal Academy and Mentoring

In the case of DLA Piper, talent and motivation must both be present to make someone fit for the job. More problematic is the fact that applicants arriving straight from graduation know very little about the practical aspects of the legal advisory sector, and almost nothing about business, yet these are extremely important when dealing with clients. Therefore, DLA is keen on providing detailed induction, an internal academy and mentoring programs. Oppenheim, on the other hand, sees no problem with detecting new blood. As partner Dr. Gergely Légrádi says, every year brings a group of thoughtful, committed and humble graduates. Légrádi also highlights generation-specific features that differentiate the young from their older peers. “They have adapted to our fast-paced world, they are better informed and can handle web and social media tools more seamlessly,” he adds. Dr. Vera Nagy, a senior attorney at Simonfay & Partners with offices in Vienna and Budapest, agrees that Generation Y members are very much different, and one of their specialties is that they are more comfortable with tech solutions. “They also have a lot bigger selfconfidence than previous generations, and feel much more entitled,” she adds. On the other hand, since the business world requires impeccable English, students

BBJ_2511_special_report.indd 17

Youth today expect professional development and career advancement opportunities from their employers, right from starting, DLA Piper observes. They want variation in work and stimulating challenges from the minute they join, along with a clear vision about the company’s future and their role in it. They are generally less patient, more courageous and value development options and an innovative mindset the most. Dentons strives to harness this whole new attitude as it is the first law firm in the world that has its own technology development company. Nextlaw Labs applies artificial intelligence to serve clients better and to find more efficient and practical solutions for legal needs worldwide. And Dentons is banking on the high level of Generation Y engagement to capitalize on this technological advantage. In one respect, the legal profession is safe from losing more talent, namely because those with a law degree barely work abroad. According to a 2015 study on the Hungarian legal education, only

3.7% of lawyers

were employed in a foreign country as of 2013, the third lowest number among all professions. According to Dentons, it is mainly people with EU law knowledge or a law degree from a different state who have good chances to immigrate, as the Hungarian legal degree is bound to the local legal system. In the experience of DLA Piper, in turn, a new trend is rising: a considerable number of talented fresh graduates imagine the launch of their carrier outside the legal industry, most typically in the advisory sector. Apparently, it remains to be seen to what extent the best law firms can keep attracting the cream of the crop in the long run.

EXPERT OPINION

Solar Boom in Hungary Zoltán Faludi Managing Partner FALUDI WOLF THEISS

For legal reasons, there is no potential in the development of wind turbines in Hungary. However, the new rules on electricity generation from renewable energy sources (RES) are changing the investment environment regarding photovoltaic power plants (PVPP). The most important pillars of the new regulatory framework are the financial incentive schemes aiming to promote electricity generation from RES. These schemes have been fundamentally amended as of January 1, 2017. The old Financial Incentive Scheme Under the old regime, the promotion of electricity generation from RES was facilitated through a mandatory off-take (feed-in) system. This means that the Hungarian electricity transmission system operator, MAVIR, was obliged to purchase the electricity generated and offered by the eligible producers at a fixed price well above market prices, as specified in statutory law. Eligibility for participating in this subsidy regime was granted by the Hungarian Energy Authority (HEA) upon the applications of RES-electricity producers. In its decisions granting eligibility, the HEA specified the period and the amount of electricity falling under the subsidy regime. Taking account of the amendments to this scheme, it needs to be stressed that the old rules apply for applications submitted by December 31, 2016. Eligibility granted under the old regime will remain unaltered (with the same pricing system) and also transferable after January 1, 2017. The Revised RES Support Scheme The revised RES support scheme is, however, a more sophisticated system, differentiating between electricity generators with regard to their inbuilt electricity generation capacities. It needs to be stressed that the budget

of the revised subsidy regime is capped regarding each of the respective categories. Developers of power plants with a peak capacity below 0.5 MW (Micro PPs) applying for eligibility after January 1, 2017 face a significantly less generous regulatory framework. The reason for this is that the benchmarks used to calculate the return of investment period has become much stricter. The most notable change is that the reference return of investment period for PVPPs has been decreased to 13 years (from 22-25 years). Pursuant to the new rules, the electricity generation facilities using RES with a peak capacity of more than 0.5 MW will no longer be eligible to participate in the mandatory off-take system. For them, the new premium-based supporting scheme will apply. Under this scheme, the electricity producers need to sell the electricity generated individually, on a free-market basis. The premium they can achieve as a margin is the difference between the two different reference prices set by MAVIR and HEA. In the case of power plants with a peak capacity between 0.5 MW and 1 MW (Small PPs), the support price will be the same as currently applicable in the mandatory off-take system. For such new generation facilities as well, the benchmarks applicable for calculating the return of investment period have become much stricter (generally the same benchmarks apply as in the case of Micro PPs). For power plants with a peak capacity above 1 MW (Major PPs), the support price will be the subject of competitive tendering. Accordingly, the Major PPs will only be eligible to participate in the new subsidy scheme if they are awarded through proper tender proceedings that aim to select the most competitive and most effective projects. The publication of the first tenders is expected in the second half of 2017 at the earliest. The Reaction of the Market Players Under these circumstances it should not be a surprise that at the end of 2016, several applications were submitted for participation in the mandatory off-take system under the old regime. An overwhelming majority of the applications were submitted by developers wishing to build new PVPPs as Micro PPs (due to the simplified licensing rules applicable). Regarding RES, the focus has been shifted from wind turbines to PVPPs. However, it is a question for the next few months whether the license holders would want to develop their Micro PPs alone, or whether they are willing to sell their eligibilities to professional investors or try to find business partners in other ways to implement the projects.

www.wolftheiss.com

NOTE: ALL ARTICLES MARKED EXPERT OPINIONS ARE PAID PROMOTIONAL CONTENT FOR WHICH THE BUDAPEST BUSINESS JOURNAL DOES NOT TAKE RESPONSIBILITY

“For the young, salary is a big issue, so many do postgraduate degrees or complete an additional undergraduate one, possibly abroad, to stand a better chance for having a well-paid job or launching their own business. Or they try their luck in a richer country.”

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Budapest Business Journal | June 2 – June 15, 2017

NGO law Affects Business too, TASZ Warns

The director of a Hungarian NGO says she wants businesses to stand up for civil society rights, pointing out the legal changes the sector faces once a new bill comes into force, likely in early June, could impact the support companies offer through CSR programs in Hungary. ROBIN MARSHALL

“A strong civil society is an indicator for stability in a country: The UN Special rapporteur, Maina Kiai has found that the presence of a robust, vocal and critical civil society sector guarantees, almost without exception, that a state also possesses a good business environment,” says Stefánia Kapronczay, executive director of the Hungarian Civil Liberties Union, TASZ. The NGO’s website described itself as being “active in protecting the rights of citizens against undue interference by those in position of public power”. In essence, the draft Bill on the Transparency of Organizations Financed from Abroad would force NGOs that receive more than

HUF 7.2 million annually

from a foreign source to register as a “foreign-supported organization” and adopt the label on websites and publications. It will also be required to give the names, countries and cities of supporters abroad. What happens if a donor insists on anonymity isn’t clear, Kapronczay says. “There is nothing about the way these obligations should be interpreted in the draft legislation,” she points out. She fears such ambiguity could lead to different interpretations being put on the law by different judges. The bill is very similar to one in place in Russia and Israel. In both those cases, the bill was followed by even more stringent controls. She fears that future steps might include an insistence that anonymous donations be rejected by NGOs, or the withdrawal of foreign-funded NGOs’ eligibility for the

1%

of income tax

donations that charities are granted under Hungarian law. That would have serious

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Stefánia Kapronczay, executive director of the Hungarian Civil Liberties Union, TASZ.

“Our organizations stand up for a fully independent judiciary; that is not only important for human rights, but also for resolving business disputes. It protects businesses from corruption and cronyism.” funding implications, the director says. “It was HUF 7 mln for us in 2016; that is a significant contribution to the costs of legal aid for 2,000 people annually.” The draft will affect civil society organizations, but not sports associations, religious and political foundations, mutual associations and ethnic minority representation. Organizations providing social services are currently included, but this is apparently being looked at again.

Hungarian People “This is really talking about the issues we represent; we represent people, mostly the people of Hungary. Some others represent migrants and refugees, but I think you can also serve the rights of Hungarian people by protecting the rule of law and the interests of the whole country. That is something that can be common ground with the business community.” Technically, the draft bill is not a government measure; it was brought forward by three MPs (albeit all from the governing Fidesz party). By law, government-sponsored bills must include a due diligence investigation of the likely outcomes, and public consultation; those stipulations do not apply to privately brought bills,

even when they clearly chime with government rhetoric. “We had a meeting in the Ministry of Justice on April 20 where we received an invitation to detail our critique of the law. But the state secretary made it clear that, as this is not a government proposal, it had no power to withdraw the bill. That is the only occasion when we met anyone from the government regarding this matter, despite repeatedly asking for consultation.” The government has certainly spoken in public about the bill, with justifications made for it including the need to strengthen anti-terrorism and antimoney laundering measures. Most often, though, discussion of the bill is framed in terms of increased transparency. In a March 21 blog, government spokesman Zoltán Kovács wrote that he understood international concerns, before insisting they were misplaced: “After all, an ‘NGO crackdown’! It sounds terrible and would be legitimate cause for worry. But that’s not what’s happening in Hungary. The NGO legislation that’s currently under consideration calls for greater transparency, particularly transparency of groups operating with international funding [.…] Civic groups remain an essential part of every democratic society, but when they’re carrying out activities funded by a foreign interest, they should be transparent about that. [...] ‘Hungarian citizens must be given the right to know about all public actors, who they are and who pays them. We have the right to know,’ said Prime Minister Orbán. ‘So, we want transparency.’.” In another blog on April 11 he added: “This is about transparency in civil society. NGOs, not even those representing foreign interests, are not in jeopardy in Hungary.” Kapronczay insists TASZ wants that too. “Our organization is all about transparency. We already have to publish a financial report every year

in order to maintain our public benefit status [eligibility for 1% tax donations from Hungarian tax payers]. That is published on our website and the birosag. hu [National Office for the Judiciary] website. Our donors also require us to publish public accounts and display their names on our publications. Further to that we also publish a summary about our finances in an easy to understand format.” Persuasive though Kovács’ defense might be, not everyone accepts the government argument. The Independent newspaper reported on May 16 that the United Nations has called on Hungary to withdraw the proposed law. Quoting from a report prepared by special rapporteurs Michel Forst and David Kaye, it said financial transparency was ensured under existing legislation, adding: “The current bill would only discriminate against, delegitimize and stigmatize NGOs that receive all or part of their funding from abroad. If adopted, it would have a chilling effect not only on expressions of peaceful dissent but also on the legitimate work of NGOs and individual human rights defenders scrutinizing government and exposing human rights violations.” On May 17, the European Parliament also called on Hungary to withdraw the draft bill.

Direct Consequences Kapronczay says the logic of the rhetoric behind the bill impacts foreign multinationals. “It says foreign funding is against the interests of Hungary. Many companies here are foreign funded, so what does it mean to them? And many companies have CSR programs to fund civil groups, so is that frowned upon? These are very direct consequences,” insists Kapronczay. “What we would like to see from the business community is it taking a clear stance for these values…. NGOs are standing up for the values of the European Union, such as rule of law, which businesses operating in EU countries also benefit from. In my opinion, it is important that business also stands up for these, not only the free movement of capital. Moreover, standing up for values like human rights and democracy can have added value, because the customers who care about this do tend to have more money,” she argues. “Our organizations stand up for a fully independent judiciary; that is not only important for human rights, but also for resolving business disputes. It protects businesses from corruption and cronyism.”

Maina Kiai’s 2015 “Report of the Special Rapporteur on the rights to freedom of peaceful assembly and of association”, in which he looked at 37 countries (Hungary was not one), made the following conclusion: “The rule of law is stronger, transparency is greater and markets are less tainted by corruption. Indeed, the presence of a critical civil society can be viewed as a barometer of a State’s confidence and stability — important factors for businesses looking to invest their money.”

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EXPERT OPINION

Robust Growth on Real Estate Market Destined to Continue The overall picture couldn’t be better on the Hungarian real estate market: Capital keeps flowing in and investing promises handsome yields. Existing challenges mainly stem from construction bottlenecks induced by breakneck pace growth.

On the other hand, demand was put on hold for years here, which is now offset by the current above-average dynamics. However, in the meantime many left the country to work abroad, and consequently the construction sector is struggling to keep up with the exponential growth due to a dire lack of capacity. Rescue cannot be expected from foreign migrant workers, either. Those that run larger projects are confronted with extra difficulties in committing skilled labor. The labor shortage is pushing prices up. It remains to be seen how the market will handle the latter. “As for the office segment, a critical question concerns whether the vast number of newly developed office spaces due to hit the market in 2018 will truly find enough tenants at the end of the day,” Czike notes.

Gábor Czike, partner and head of the Real Estate and Construction Group of CMS Budapest. Many transactions were deliberately pushed over to 2017 to benefit from the reduced corporate income tax rate effective from January 1; without such moves, the 2007 peak in real estate investment would likely have been surpassed. Despite similarly record-high investment activity, the situation differs from that of 2007 on two accounts, Czike stresses. For one, interest rates are at an unprecedented low, which fuels Hungarian forint loans immensely. Furthermore, domestic investors have emerged on the radar, too, and are carving ever larger slices out of the investment cake. Hungarian real estate funds are faring well, and a constant capital flow is clearly visible. All this combines to create a much healthier market than back in 2007.

All segments are witnessing dynamic expansion. The retail sector is profiting tremendously from substantial year-onyear wage increases and the corresponding growth in consumer spending, József Várady, recently appointed partner of the Real Estate Group of CMS Budapest, adds. The residential property segment really took off in early 2016 thanks to a measure according to which VAT on newly built homes was cut from 27% to 5%. Logistics has registered equally strong figures in the past two years.

Another sign for market optimism is that regional real estate funds, though still small in capital volume, have appeared with Czech and Slovak funds buying on the Hungarian market – a phenomenon previously unheard of. Those investing into CEE real estate funds must count on somewhat smaller returns, though, than the standard profit rate of 6-10% of the property market, as real estate funds are obliged by law to keep some their assets in government bonds, the lower interest on which erodes the final total returns. The returns of retail investors in real estate funds are therefore closer to around 3%.

“The peak of 2007 brought EUR 2 billion in total investments, which had dropped to EUR 250 million by 2012,” Várady says. “Our practice detected the next robust upward trend in the second half of 2015, while 2016 approached pre-crisis investment levels at an estimated volume of EUR 1.7 bln-1.8 bln.”

According to Várady, finance is not an issue for the moment. The times are gone when it was nearly impossible to find a bank to back a real estate project. Instead the banks are now competing against one other to get on board. That said, banks seem to be carrying

Dynamic Expansion

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Finance not an Issue

József Várady, recently appointed partner of the Real Estate Group of CMS Budapest.

“We are real ‘omnivores’ when it comes to real estate. Our confidence in continuing positive trends and our own improving business perspectives couldn’t be manifested better than by the appointment of our second real estate partner.” out more thorough assessments prior to engagement and are evaluating risks more carefully than before the recession. The experts agree that the main driving engine of the current growth is connected to prevailing low interest rates, both locally and globally. It is worth noting that any sudden major change on that front could quickly turn optimism into gloom. Higher interest would also make foreign investors shift their focus to the potential political, macroeconomic or sociological risks related to Hungary that the market turns a blind eye to for now. But, sooner or later, interest rates are destined to go up, even though the probability of an interest raising cycle looks rather unlikely in the short-term. CMS has always treated real estate with special care, even in the years of hardship, and the firm prides itself having gathered expertise in every segment from greenfield investments to building shopping malls. “We are real ‘omnivores’ when it comes to real estate,” Czike says. “Our confidence in continuing positive trends and our own improving business perspectives couldn’t be

manifested better than by the appointment of our second real estate partner, József Várady.” This measure makes CMS Budapest the only international law firm in town with two such partners. The message over market confidence is further strengthened by the recent merger between CMS Cameron McKenna U.K. and Olswang and Nabarro. Thanks to the latter’s special focus on property, some 500 attorneys now deal with real estate at CMS U.K. This cooperation is bound to deliver mutual benefits. “Nabarro has not had a CEE representation, so a direct link with the CMS Budapest office opens new growth paths for CMS. And our Budapest office is looking forward to serving Nabarro’s legacy premium clientele that is seeking professional consultancy,” Czike concludes.

cms.law

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As highlighted by the CEE Real Estate Compass recently published by CMS and Colliers International, 2016 saw higher flows into CEE Real Estate than at any point since the last cyclical peak in 2007. Hungary has entered a particularly active phase on the real estate market. One main reason for the upswing is that prices are still very attractive for investors compared to other prime cities in the region, Gábor Czike, partner and head of the Real Estate and Construction Group of CMS Budapest, says.

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EXPERT OPINION

Tech and More; Innovation Back and Forth Over CEU Cont After two months, the so-called Lex CEU is still in the Legal Profession drawing lots of attention to itself. On May 17, the Gábor Papp Head of Professional Development HORVÁTH & PARTNERS DLA PIPER

There is at least one thing CDs, Walkmans, fax machines, Gameboys, landline phones and dinosaurs have in common: They are all extinct. (Well, almost; dinos tend to live their second renaissance, don’t they?) Why would the traditional way of providing legal services be any different? Why do we think that the legal profession might remain intact in the storm of the tech revolution? Well, we had better not! Highly ranked law firms seem to follow the new winds and have already recognized the advantages that cognitive computing and artificial intelligence (AI) can offer to the legal profession. Using artificial intelligence in the legal service sector is science-fiction no more. AI may be utilized in the industry in many ways, from document processing through litigation to advisory work. The importance of cognitive technologies is the most obvious in document-heavy areas of law, such as due diligence procedures, compliance works, investigations or litigation. To take one example, KIRA™ – an integrated contract analysis platform – easily processes large amounts of documents. Besides creating an electronic data room, it is capable of preparing the backbone of a due diligence report. Clearly this can save a lot of time for law firms, and money for clients. According to one recent experience at DLA Piper, by the use of this application it was possible to process and review half a million documents by a small team in only two days. Another potential use of AI in the legal service sector is calculating probabilities and predicting outcomes of legal disputes and proceedings. This tool heavily builds

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on a specific database (court dockets), and uses data mining and predictive analytic techniques to forecast outcomes of litigation. No doubt, such solutions seem to be far away from our domestic market everyday realities; nevertheless one should be aware that this is already happening in other parts of the globe. When it comes to advisory work, AI is now ready to take away commodity works. To put it simply, AI tools can solve any legal problem, provided that such a legal problem has been solved before and uploaded to the internet. Appealing indeed! Still, all of the above does not make AI a law professor. Cognitive technologies may ruthlessly find and adapt already existing solutions. Solutions, previously created by human lawyers. Give AI a brand new legal problem, with a blurry regulatory background, which is often the case in real life, and the cognitive technology will most probably be clueless. And this leads us to an important question: Is it only shiny and trendy apps that are capable innovation in the legal profession? I would doubt so. Clients expect valuefor money services and high-quality work performed at the same time. And that should be governed by humans. No toptier lawyer can afford to lose high quality assignments thanks to less effective organization or the lack of talented experts, just to name two crucial fields of innovative solutions. It is not a surprise then, that previously unseen project management mechanisms are infiltrating to the legal service sector. Project management is also essential for planning workforce and budget, as well as ensuring you keep to the allocated budget. Furthermore, meaningful and tailormade learning and development (L&D) programs have the simultaneous benefits of attracting talented graduates as well as increasing the level of job satisfaction, motivation and engagement of all fee earners by providing a strong value proposition. L&D programs convey the message that fee earners do matter to the firm, and that the firm is ready to invest in them. At the same time, innovative L&D programs build reputation, brand and the promise of a consistent quality on the market.

European Parliament approved a resolution urging the Hungarian government “to immediately suspend all deadlines in the act amending the National Higher Education Act, to start immediate dialogue with the relevant U.S. authorities in order to guarantee the future operations of the CEU issuing U.S.-accredited degrees and to make a public commitment that the university can remain in Budapest as a free institution.”

CLAUDIA PATRICOLO

CEU President and Rector Michael Ignatieff had earlier said the university, which issues Hungarian or American degrees, depending on the course the student takes, “is like a person with two passports – a U.S. one and a European one – and the government wants to take one away. Our dual accreditation is a basic guarantee of our academic freedom. The legislation forbids us to have two legal entities and would make it impossible for the university to continue to award American accredited master’s and doctoral degrees.” The act was signed into law on April 10 by Hungary’s President János Áder; without some kind of resolution, CEU says it will be forced to stop enrolling new students by January 1, 2018. The National Higher Education Act requires the university, founded by American-Hungarian financier George Soros, with whom the government has many disagreements, to operate a campus in both the United States and Hungary, even if CEU does not see any educational justification for an American center. Furthermore, the university should change its name and its operations must be underpinned by an intergovernmental agreement between the United States and Hungary. But the U.S. State Department has explained that the federal government has no legal competence to negotiate

“CEU is like a person with two passports – a U.S. one and a European one – and the government wants to take one away. Our dual accreditation is a basic guarantee of our academic freedom.” on higher education; that authority lies with individual American states. This approach seems to have puzzled the Hungarian government, which says it already has such agreements with the United States, and the Hungarian negotiator Kristóf Altusz has commented that he will only talk with the competent U.S. authorities.

Discussions Without Delay On May 24, New York State Governor Andrew M. Cuomo issued a statement declaring his readiness to enter into discussions “without delay with the Hungarian government about the amendments to the Higher Education Act that particularly target CEU”. The university is registered in New York State, and is accredited by the Middle States Commission for Higher Education.

To sum up, cognitive technologies do not make highly qualified legal professionals redundant. On the contrary, innovative tech solutions alone may be worthless. These must be seen as tools allowing legal service providers to focus on the real legal issues, instead of spending empty hours on document review and processing. Hence, sustainable innovation in the case of the legal service sector stands less for pure tech, but rather for a system run by human experts leveraging technology. Innovation is clearly more than tech.

www.dlapiper.com

The CEU press conference on May 30.

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The news was warmly welcomed by CEU: “We have said since the beginning that the right solution is a new agreement between New York and Hungary. We hope an agreement can be reached that builds on the existing 2004 agreement between New York State and the government of Hungary to guarantee CEU’s academic freedom and strengthen its role, in Governor Cuomo’s words, as ‘a symbol of AmericanHungarian cooperation’,” said Ignatieff. On Friday 26, Cuomo had a phone call with Altusz as the first step toward a cooperation that could allow CEU remain in Budapest with its academic freedom and institutional integrity intact. “We will surely continue our academic program for 2017-2018. We already have full courses,” Ignatieff said during a press conference on May 30 announcing the talks between Hungary and New York State. Asked if the university had a plan B, Ignatieff told journalists CEU cannot afford such a luxury, because “we do not want them to think that if they push just a little bit harder we will go away. This is our home.”

Added Value CEU needs to remind to the government its added value to the country, he added. On June 23, Joachim Gauck, former President of Germany from 2012 and 2017, will be awarded with the 2017 Open Society Prize in recognition of his courageous defense of human rights and his distinguished record in the service of free societies. The award ceremony will also see the participation of the Nobel Prize wunner Mario Varga Llosa. “This is a part of what we are bringing to Budapest,” Ignatieff commented. Minister of the Prime Minister’s Office János Lázár was reported by national wire service MTI as commenting that, while some have been “whipped into a frenzy” over the matter of CEU, a number of countries have been prepared to negotiate with the government, citing the example of China. He also mentioned the U.S.-based McDaniel College, noting that the government has already held talks with its leadership, as well as the State of Maryland, where the school has its main campus, and both sides are ready to reach an agreement, he added. Lázár has insisted that the higher education amendment is not a direct attack against CEU, considering that the legislation will affect every university operating in Hungary. “The European Commission’s charge of infringement proceedings only concerns the provision of services, and not academic freedom, and the New Higher Education legislation conforms to the relevant European legal norms, and Hungary is therefore ready to face all investigations,” Lázár said. Even if the legislation is generally formulated, CEU certainly considers itself the specific target. Ignatieff says Hungarian government spokesperson Zoltán Kovács has made a series of inaccurate and defamatory statements about the university. “We do not

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“The European Commission’s charge of infringement proceedings only concerns the provision of services, and not academic freedom, and the New Higher Education legislation conforms to the relevant European legal norms, and Hungary is therefore ready to face all investigations.” seek a status that is ‘above the law’: we merely seek the legal right to continue in Budapest as we have done for more than 20 years. Lex CEU is an unacceptable infringement of our academic freedom, exacerbated by unrealistic deadlines. If the law is not repealed or modified, we cannot continue to operate in the city that is our home. If the government were listening, they would have heard our message clearly in Budapest.”

Will not Yield Lázár, meanwhile, has claimed that the European Commission’s resolution resulted from Soros’ enormous influence over Brussels, but vowed that Hungary will not yield to the exertion of political pressure. “The university is not owned by anyone,” replied Ignatieff. “It is a fully independent self-governing institution and claims to the contrary are both false and defamatory.” He clarified that there are not four CEUs, as stated by the government, which was considering all the legal entities that include the name CEU. “These entities do not function as universities. Since they carry out activities supporting the university’s operations, the term CEU appears in their name, but these are not to be confused with Central European University.” It seems that it is the students and possibly Hungary’s image itself that would lose out most should CEU close. There are

1,500 students

currently enrolled at the university from 117 different countries, plus almost 14,000 alumni and 980 staff. The university’s graduate programs have a high ranking (among the top 50 worldwide, when it comes to politics and international studies); it was named the second most international university in the world in the Times Higher Education list, published on April 26. The list features 200 universities around the globe, and is based on data collected for the World University Rankings.

EXPERT OPINION

Data Protection by Design Dr. Ágnes Tompa LL.M. Senior Attorney Head of Corporate / M&A Department Noerr & Partners Law Office

“Design is not just what it looks like and feels like. Design is how it works.” Steve Jobs The European Parliament and European Council adopted the General Data Protection Regulation (GDPR) last year, which will come into effect in May 2018. The GDPR will replace the current European legislation, the Data Protection Directive (1995). The current Directive has no equivalent to the concept of privacy by design. Privacy by design or data protection by design is the notion that the means and purposes of personal data processing are designed, from the beginning, with data protection in mind. The present system of various national laws transposing the Directive resulted in a fragmented regulatory system for data controllers operating in the European Union. What often happened was that a multinational company operating in different countries in the EU had to use several versions of its data protection policies in order to comply with the national laws. It meant different documentation requirements, different software and different methods of storing, deleting or forwarding data for each and every country within the same company. With the GDPR, a more standardized data protection law will come into force across the EU. The GDPR addresses the principle of data protection by design as a legal obligation for data controllers and processors for the first time, making an explicit reference to data minimization and the possible use of pseudonymization. Data minimization means that personal data must be adequate, relevant and limited to that which is necessary in relation to the purposes for which it is processed. Pseudonymization refers to the technique of processing personal data in such a way that it can no longer be attributed to a specific data subject without the use of additional information, which must be kept separately and be subject to technical and organizational measures to ensure nonattribution. This principle – together with the principle of data protection by default – encourages controllers and processors to include data protection measures from the start of the process, at the design stage of

their products and services. The principle requires organizations to implement both technical and organizational measures that will guarantee and protect the privacy of individuals. This involves organizations examining the amount and extent of personal data collected and processed, and affording consideration to how long such information is kept and how accessible it is. Under this provision, a data subject should be protected by the strictest privacy settings while still allowing for the data subject to receive or use the product or service. Even more, organizations need to approach all their project management and risk management methodologies and practices from the point of view of data protection by design. This will entail integrating core privacy considerations coupled with independent and robust Privacy Impact Assessments (PIAs). PIAs are of fundamental importance under the GDPR. They are an integral part of taking a data-by-design approach and making sure that all internal processes and eventual privacy codes are also compliant with the concept of data protection by design. Besides data minimization and pseudonymization, other methods can be staff training programs, audit and policy reviews, or implementation of new procedures. When implementing the principle, Article 25 of the GDPR suggests considering the following: • the state of the art (available technology); • the cost of implementation; • the nature, scope, context and purpose of the data processing; and • the risks to natural persons and their severity. As the measures to be taken are subject to the data processing activities of the relevant organization, before implementation, reviewing the above factors is unavoidable. In summary, organizations should consider the data protection implications of a given processing activity at an early stage, rather than merely at the time of collection or processing. Given the provisions of the GDPR, the obligations and responsibility on organizations in the area of data protection are only set to increase.

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Continues as Clock Ticks Down

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Top-ranked law firms BELOW IS THE LIST OF LAW FIRMS WITH INTERNATIONAL AFFILIATIONS OPERATING IN HUNGARY THAT HAVE BEEN RECOMMENDED IN THE MOST AREAS OF LEGAL ACTIVITIES IN 2017 (IN TOP CATEGORIES OF VARIOUS RANKING BODIES, E.G. BAND 1 WITH CHAMBERS EUROPE AND CHAMBERS GLOBAL AND TIER 1 WITH LEGAL 500 AND IFLR 1000). CHAMBERS GLOBAL 2017 BAND 1

CHAMBERS EUROPE 2017 BAND 1

LEGAL 500 2017 TIER 1

IFLR 1000 2017 TIER 1

TOTAL NUMBER OF RECOMMENDATIONS

3

8

9

4

24

1

4

4

4

13

1

4

5

1

11

1

3

5

1

10

1

2

3

3

9

-

1

6

-

7

1

3

3

-

7

-

1

3

3

7

1

3

2

-

6

CMS

Réczicza Dentons Europe LLP

Hegymegi-Barakonyi és Társa Baker & McKenzie

Horváth & Partners DLA Piper

Andrékó Kinstellar

Lakatos Köves and Partners

Oppenheim

Siegler Ügyvédi Iroda / Weil Gotshal & Manges LLP

Szecskay Attorneys at Law

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Top-ranked law firms CHAMBERS GLOBAL 2017 BAND 1

CHAMBERS EUROPE 2017 BAND 1

LEGAL 500 2017 TIER 1

IFLR 1000 2017 TIER 1

TOTAL NUMBER OF RECOMMENDATIONS

1

1

2

-

4

-

1

2

-

3

-

1

1

1

3

-

1

1

-

2

-

1

1

-

2

-

1

-

-

1

Forgó, Damjanovic & Partners

-

-

1

-

1

VJT & Partners

-

-

1

-

1

Nagy & Trócsányi

Allen & Overy

Faludi Wolf Theiss

Jalsovszky SBGK Attorneys at Law

Danubia Patent and Law Office LLC in cooperation with Sár & Partners

C H A M B E R S G L O B A L 2 0 17 LEGAL ACTIVITIES

Banking & Finance

BAND 1

Andrékó Kinstellar CMS Horváth & Partners DLA Piper

BAND 2

Allen & Overy Lakatos Köves & Partners Réczicza Dentons Europe LLP Siegler Ügyvédi Iroda / Weil Gotshal & Manges LLP

Corporate / M&A

CMS Hegymegi-Barakonyi és Társa Baker & McKenzie Réczicza Dentons Europe LLP

Andrékó Kinstellar Horváth & Partners DLA Piper Siegler Ügyvédi Iroda / Weil Gotshal & Manges LLP

Dispute resolution

CMS Nagy & Trócsányi Oppenheim Szecskay Attorneys at Law

Hegymegi-Barakonyi és Társa Baker & McKenzie Horváth & Partners DLA Piper Réczicza Dentons Europe LLP

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BAND 3

Faludi Wolf Theiss

Allen & Overy Lakatos Köves & Partners Oppenheim Szabó Kelemen & Partners

Lakatos Köves & Partners Siegler Ügyvédi Iroda / Weil Gotshal & Manges LLP

BAND 4

Gárdos, Füredi, Mosonyi, Tomori HP Legal | Hajdu & Partners Hegymegi-Barakonyi és Társa Baker & McKenzie Szecskay Attorneys at Law

Faludi Wolf Theiss Forgó, Damjanovic & Partners Jeantet-d’Ornano Nagy & Trócsányi Schoenherr Hetényi Attorneys at Law Szecskay Attorneys at Law VJT & Partners

Gárdos, Füredi, Mosonyi, Tomori Szabó Kelemen & Partners Attorneys

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Budapest Business Journal | June 2 – June 15, 2017

EXPERT OPINION

Nagy & Trócsányi: 25 Years of Problem Solving “People think we are problem solvers, and I like to think that is the case,” says Péter Nagy of the law firm he co-founded a quarter of a century ago. In part, it explains the continued success of the practice. ROBIN MARSHALL

But before we talk more about that, there is an elephant in the room we should address. For those who have followed the roller coaster ride of Hungary’s economy since the change of regime, the name is familiar. There weren’t many deals, especially in the early days, that Nagy & Trócsányi weren’t involved in. Those who have arrived a little later to the scene possibly know of it only through the name of the other co-founder, current Minister of Justice László Trócsányi. That, naturally enough, shapes perceptions. It also affects business. “The biggest challenge in the market today is that Trócsányi is minister,” says Nagy with a smile. “Since then, we do not get even one single case from the government, except from one or two pro bono cases. We have some ongoing matters, which we got before he was appointed to his post, but nothing new. From 1991, our experience was that in really important cases, the government would come to us. It wasn’t a lot of work, but one or two cases a year that were really challenging. We had mandates from almost all the democratic governments: We worked for the Antall,

“We were established as an independent law firm and we are still here, no matter how the market has changed. The firm was founded on our decision to make a good business based on high quality, complex case work, and that is still a key driving feature of the firm.” Horn, Orbán, Medgyessy governments as well. Of course, we are very happy he is serving as minister, but from a business point of view that [government work] is now insignificant and it used to be a big segment.” But you also get the sense that Nagy doesn’t just miss the business. “He [Trócsányi] is a well-respected lawyer, a university professor. His absence is painful.” And he is not the only senior partner on a leave of absence from the firm: Zoltán Csehi is currently serving as a judge at the European Court of Justice. “I keep telling them it is all very well, but

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Péter Nagy, co-founder Nagy & Trócsányi.

they should come back,” Nagy says. He is only half joking. With the collapse of the Iron Curtain and the change of regime in Hungary, Nagy returned to the country from New York, Trócsányi from Brussels. “The law changed on

October 1,

1991,

so we set up exactly on that day, and one year later had the law firm incorporated,” Nagy explains. The anniversary will be celebrated later this year, though how, exactly, is still being planned.

Huge Demand Asked how the market has changed since those days, Nagy’s immediate answer is just one word: “Absolutely.” Initially he says there was “huge demand for lawyering in business law”. The first international law firms that moved to Budapest brought with them lawyers who either were not particularly good or who had no local knowledge, giving Nagy & Trócsányi a huge local advantage throughout the ’90s. Since then, Nagy says, the market has become increasingly more competitive. Foreign advocates at the international firms picked up local knowledge and took on more Hungarian lawyers. What is now the Big Four took increasingly large swathes of the tax business by aggressively cutting fees. Then came the recession. But the firm continued to find its own way, and difficult cases continued

to find their way to it. It is one of the advantages of being in business for 25 years, as partner Péter Berethalmi, who started his career with the firm as a junior lawyer in 1996, notes. “We are proud to mention that we have built up a lot of connections and good relations with international firms in these 25 years,” he says. “Take our membership of LexMundi: It is one of the most reputable networks, acknowledged in the rankings by Chambers.” Berethalmi says today the firm does a lot of litigation, real estate, banking and project finance, M&A, competition law and employment law. It also has strong energy business. Nagy says that is important for the bottom line. “These are big clients with real money, and the stakes are very high. That means they do not try to push down the fees or cap them, or cut back on the hours.” That is not the case in other sectors, Berethalmi points out. “Everyone wants lower fees and lower caps. Now, even after you have an agreed cap, there is often another round of negotiations to push that down!”

New Generation For all that, business is good, the partners agree. “Things are getting better and better,” says the co-founder. “We have more transactional work and, in the last couple of years, litigation. We have maybe two-dozen huge tax-related litigation cases we are working on, public procurements, bank law issues. If we cannot work for the government, we can still work against it,” he laughs. Berethalmi acknowledges some difficulties in recruiting, but says that is true of the industry in general, and is

Péter Berethalmi, Partner.

largely down to the different attitudes in the latest generation. “Five or ten years ago, if you went to a job fair, students were gathered around all the booths. Now you have to find them, make friends with them, engage with them on social media.” But he says he is annoyed by employers continually complaining about them. “I like the new generation, I do not have any problem with them. I think we should not judge them based on this [attitude]; we need to learn to cope with it.” And the firm continues to run its own education programs, to source and train talent. “We have maintained our student program, we usually hire two or three students in the summer, and try to pick our associates from that pool,” says Berethalmi. “And from those we try and pick our partners, like me. I think all but two of our partners were junior lawyers with us. Obviously not everyone can follow that path, but that is the goal.” The markets may have shifted “absolutely” in

25 years,

but it seems Nagy & Trócsányi has not. “We were established as an independent law firm and we are still here, no matter how the market has changed. The firm was founded on our decision to make a good business based on high quality, complex case work, and that is still a key driving feature of the firm,” says Nagy. “We still get the most interesting cases. If they are considered difficult, or even impossible, then people come to us.”

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EXPERT OPINION

EY Law: Making One-stop Synergies Work EY Law Hungary may be the biggest international law firm you have never heard of, though that does not mean it has not been busy, and will in any case likely change in the near future.

“EY started up its law firm in Hungary in about 2010, growing from tax controversy and litigation. We now have almost 30 people with law degrees; 30 people is bigger than some international law firms on the market here.”

ROBIN MARSHALL

According to partner Iván Sefer, EY Law has been “recruiting aggressively” as it builds up what he calls “bench depth”; indeed, he only joined himself in July 2016, lured away from a partnership with one of the biggest international firms in the city. “Some people told me I was committing professional suicide; others were really supportive and said ‘We really get what you are doing’,” he says with a shrug. What he was doing, in part, is illustrating a growing trend. EY is one of the Big Four consultancy firms, and all of them are building up their law practices at present. In one sense, it is going back to the future. The Big Four traditionally had large law practices until the Enron-Arthur Anderson scandal in 2001. Business is nothing if not cyclical, however; times have changed and initially it was the tax advisory service that first saw the demand for in-house lawyers, rather than having to outsource every time a court appearance was required. “EY started up its law firm in Hungary in about 2010, growing from tax controversy and litigation. We now have almost

30

people

with law degrees; 30 people is bigger than some international law firms on the market here,” the partner explains. And Hungary is not the only EY office growing. “The U.K. is growing very quickly, Germany is very strong, the Nordics too.” And it is not just graduates and trainees. Senior lawyers and partners, like Sefer, have joined EY Law globally from every major international law firm. “It’s good to see that and know I am not alone,” he jokes.

Obvious Advantages Despite the occasional raised eyebrow when he switched from established international law firm to Big Four service line, there are obvious advantages, once you think about it. “I get involved with assignments two-three months earlier than I would working for a traditional firm. That means I get to have a say in the structure and terms of the deal, as well as the banks that will be involved. From my perspective, it means I get to add value for my clients at a much earlier stage.” It also means he gets called into many more meetings that strictly speaking are not legal than he would have previously, but given the quality of people who work at EY, he says he welcomes this. “I find

BBJ_2511_special_report.indd 25

Mini-bio: Iván Sefer is a Tier 1 banking and finance lawyer according to the rankings of Chambers and Partners and Legal 500. Prior to joining to EY, Sefer had been a partner at CMS Cameron McKenna LLP. He is a member of the Budapest Bar Association since 2006, and is also a U.K. qualified solicitor since 2010. During his career, he has been on secondments in Vienna and London. Clients include most major banks operating in Hungary, international banking and financial institutions, large international and domestic sponsors and borrowers.

it very inspiring and even educational. Because I am involved earlier and see more – I am not just approaching it from what works legally –, we are able to give more well-rounded advice,” he says. “There are around 600 people working in this office. That means that whatever issue I come across, someone, somewhere, is doing or has done something similar. And I can just pop downstairs and ask them about that. It is a source of excellent intel.” That also, clearly, benefits the client. If they already get tax advice or transaction support, business advisory or assurance services from EY, and add law to the mix, they end up with a one-stop shop. That has efficiency benefits for the customer – and that continues to be a driving

“We recently hired the head of the Competition Authority’s merger clearance group to strengthen our competition law offering. We hired a couple of trainees today to start in a month’s time. It shows not only confidence that the work load is there, but also the pipeline.”

litigation is very strong, obviously (seven of the lawyers are dedicated to this one area), but right now, for example, we are doing a lot on EU GDPR – General Data Protection Regulation – work, which will come into force in 2018 and the shortening time frame is causing companies a lot of problems.” Other areas include M&A (on both buyer and seller side), banking and finance, with a lot being done around digital banking solutions, capital markets, employment law and real estate. “We recently hired the head of the Competition Authority’s merger clearance group to strengthen our competition law offering. We hired a couple of trainees today to start in a month’s time. It shows not only confidence that the work load is there, but also the pipeline.” That brings us back to how well-known the law firm is. Sefer says he was taught by his early mentors to actively look to bring in business himself, and still does that. Then there are referrals from the worldwide EY network of

78 offices

(truly global reach is another attraction for customers) and from other service lines within the Budapest office. The capital city has long had a fiercely competitive legal market; is he trying to win business by undercutting rivals? He says not. “We see ourselves as a multinational, full-service law firm. We are competing with the traditional international firms, both for work and for talent. Having seen both worlds, in terms of structure and way of working, there are many similarities. We are confident that the force on the market ­– but Sefer says the added value to our clients that EY Law integrated model can also improve the can bring through its ‘one-stop shop’ quality of the service offered. “We get approach, will be what determines to know the client much better, because continued success.” we know them across different service So, Sefer and his colleagues have lines. We understand their business, both work and satisfied clients; the their strengths and weaknesses, areas final piece in the jigsaw is increased of potential risk, what really interests recognition. He admits that not enough them or bothers them, and can tailor has been done to get the practice our advice accordingly to better fit their recognized by the legal ranking bodies. needs.” “Historically, EY did not put a lot of emphasis on gaining recognition in the legal directories. This is a shame, as Legal Offering the practice has a significant number In terms of legal offering, EY Law Hungary of valuable credentials to its name, covers pretty much everything in Budapest and we should better communicate our except criminal law (very few international capabilities to the larger market. We are working on that now.” law firms do that in any case). “Tax

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C H A M B E R S E U R O P E 2 0 17 Legal activities

LEGAL ACTIVITIES

BAND 1

BAND 2

BAND 3

Banking & Finance

Andrékó Kinstellar CMS Horváth & Partners DLA Piper

Allen & Overy Lakatos Köves & Partners Réczicza Dentons Europe LLP Siegler Ügyvédi Iroda / Weil Gotshal & Manges LLP

Faludi Wolf Theiss Gárdos, Füredi, Mosonyi, Tomori

Capital markets

Allen & Overy Siegler Ügyvédi Iroda / Weil Gotshal & Manges LLP

Andrékó Kinstellar Gárdos, Füredi, Mosonyi, Tomori Horváth & Partners DLA Piper Lakatos Köves & Partners

CMS Réczicza Dentons Europe LLP

Competition / Antitrust

Hegymegi-Barakonyi és Társa Baker & McKenzie Oppenheim

Allen & Overy CMS Lakatos Köves & Partners Réczicza Dentons Europe LLP Szecskay Attorneys at Law

Andrékó Kinstellar CHSH Dezső & Partners Horváth & Partners DLA Piper Schoenherr Hetényi Attorneys at Law

Corporate / M&A

CMS Horváth & Partners DLA Piper

Andrékó Kinstellar Hegymegi-Barakonyi és Társa Baker & McKenzie Réczicza Dentons Europe LLP Siegler Ügyvédi Iroda / Weil Gotshal & Manges LLP

Allen & Overy Lakatos Köves & Partners Oppenheim Szabó Kelemen & Partners Attorneys

Dispute resolution

CMS Nagy & Trócsányi Oppenheim Szecskay Attorneys at Law

Horváth & Partners DLA Piper Hegymegi-Barakonyi és Társa Baker & McKenzie Réczicza Dentons Europe LLP

Gárdos, Füredi, Mosonyi, Tomori Lakatos Köves & Partners Siegler Ügyvédi Iroda / Weil Gotshal & Manges LLP

Employment

CMS Hegymegi-Barakonyi és Társa Baker & McKenzie

Horváth & Partners DLA Piper Pál és Kozma Ügyvédi Iroda Réczicza Dentons Europe LLP Szecskay Attorneys at Law VJT & Partners

CLV Partners Forgó, Damjanovic & Partners Oppenheim Szabó Kelemen & Partners

Intellectual property

Danubia Patent and Law Office LLC in cooperation with Sár & Partners SBGK Attorneys at Law Szecskay Attorneys at Law

CMS Hegymegi-Barakonyi és Társa Baker & McKenzie Sár & Partners

Bird & Bird Oppenheim

Life sciences

Hegymegi-Barakonyi és Társa Baker & McKenzie Réczicza Dentons Europe LLP Szecskay Attorneys at Law

CMS KNP LAW Nagy Koppány Varga and Partners

Private equity

Hegymegi-Barakonyi és Társa Baker & McKenzie Réczicza Dentons Europe LLP

CMS Horváth & Partners DLA Piper Siegler Ügyvédi Iroda / Weil Gotshal & Manges LLP

Projects and energy

Andrékó Kinstellar CMS Faludi Wolf Theiss Oppenheim

Budapest Law Firm No. 5000 Hegymegi-Barakonyi és Társa Baker & McKenzie Horváth & Partners DLA Piper Lakatos Köves & Partners Réczicza Dentons Europe LLP Siegler Ügyvédi Iroda / Weil Gotshal & Manges LLP

Real estate

CMS Lakatos Köves & Partners Réczicza Dentons Europe LLP

Hegymegi-Barakonyi és Társa Baker & McKenzie

Andrékó Kinstellar CHSH Dezső & Partners Horváth & Partners DLA Piper Nagy & Trócsányi Siegler Ügyvédi Iroda / Weil Gotshal & Manges LLP

Restructuring / Insolvency

CMS

Andrékó Kinstellar Horváth & Partners DLA Piper Lakatos Köves & Partners Réczicza Dentons Europe LLP Siegler Ügyvédi Iroda / Weil Gotshal & Manges LLP

Faludi Wolf Theiss Hegymegi-Barakonyi és Társa Baker & McKenzie

Tax

Horváth & Partners DLA Piper Jalsovszky

CMS Hegymegi-Barakonyi és Társa Baker & McKenzie

Faludi Wolf Theiss Nagy & Trócsányi

Technology, Media, Telecommunications

CMS Réczicza Dentons Europe LLP

Allen & Overy Lakatos Köves & Partners VJT & Partners

Bán, S. Szabó & Partners Hegymegi-Barakonyi és Társa Baker & McKenzie Horváth & Partners DLA Piper Siegler Ügyvédi Iroda / Weil Gotshal & Manges LLP

Andrékó Kinstellar Lakatos Köves & Partners Noerr

-

I F L R 10 0 0 2 0 17 TIER 1

TIER 2

TIER 3

Banking

Andrékó Kinstellar CMS Réczicza Dentons Europe LLP Siegler Ügyvédi Iroda / Weil Gotshal & Manges LLP

Allen & Overy Horváth & Partners DLA Piper Hegymegi-Barakonyi és Társa Baker & McKenzie Lakatos Köves and Partners

Faludi Wolf Theiss Gárdos Füredi Mosonyi Tomori HP Legal | Hajdu & Partners Nagy & Trócsányi Oppenheim Partos & Noblet / Hogan Lovells Szecskay Attorneys at Law

M&A

CMS Hegymegi-Barakonyi és Társa Baker & McKenzie Réczicza Dentons Europe LLP Siegler Ügyvédi Iroda / Weil Gotshal & Manges LLP

Allen & Overy Andrékó Kinstellar Faludi Wolf Theiss Horváth & Partners DLA Piper Lakatos Köves and Partners Szecskay Attorneys at Law

Jeantet-d’Ornano Nagy & Trócsányi Oppenheim

Project finance

Andrékó Kinstellar CMS Horváth & Partners DLA Piper Réczicza Dentons Europe LLP Siegler Ügyvédi Iroda / Weil Gotshal & Manges LLP

Allen & Overy Faludi Wolf Theiss Hegymegi-Barakonyi és Társa Baker & McKenzie Lakatos Köves and Partners

Oppenheim Szecskay Attorneys at Law

Energy and Infrastructure

Andrékó Kinstellar CMS Faludi Wolf Theiss Réczicza Dentons Europe LLPLP

Budapest Law Firm No. 5000 Horváth & Partners DLA Piper Hegymegi-Barakonyi és Társa Baker & McKenzie Lakatos Köves and Partners Oppenheim Siegler Ügyvédi Iroda / Weil Gotshal & Manges LLP

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LEGAL ACTIVITIES

Special Report | 27

L E G A L 5 0 0 2 0 17 TIER 1

TIER 2

TIER 3

Banking & Finance

Andrékó Kinstellar CMS Horváth & Partners DLA Piper Lakatos, Köves and Partners Réczicza Dentons Europe LLP Siegler Ügyvédi Iroda / Weil Gotshal & Manges LLP

Allen & Overy Faludi Wolf Theiss Hegymegi-Barakonyi és Társa Baker & McKenzie Szecskay Attorneys at Law

CHSH Dezső & Partners Deloitte Legal Szarvas, Erdös and Partners Law Firm Erős Ügyvédi Iroda/Squire Patton Boggs Forgó, Damjanovic & Partners Nagy & Trócsányi Oppenheim Partos & Noblet / Hogan Lovells Schoenherr Hetényi Attorneys at Law Szabó Kelemen & Partners Attorneys

Capital markets

Allen & Overy Andrékó Kinstellar Horváth & Partners DLA Piper

CMS Hegymegi-Barakonyi és Társa Baker & McKenzie Kapolyi Law Firm Lakatos, Köves and Partners Réczicza Dentons Europe LLP Siegler Ügyvédi Iroda / Weil Gotshal & Manges LLP

Forgó, Damjanovic & Partners Gárdos, Füredi, Mosonyi, Tomori Partos & Noblet / Hogan Lovells Schoenherr Hetényi Attorneys at Law Szecskay Attorneys at Law

Competition

Allen & Overy Andrékó Kinstellar CMS Hegymegi-Barakonyi és Társa Baker & McKenzie Lakatos, Köves and Partners Oppenheim

Faludi Wolf Theiss Partos & Noblet / Hogan Lovells Réczicza Dentons Europe LLP Schoenherr Hetényi Attorneys at Law Siegler Ügyvédi Iroda / Weil Gotshal & Manges LLP Szecskay Attorneys at Law

CHSH Dezsö & Partners Erős Ügyvédi Iroda/Squire Patton Boggs Forgó, Damjanovic & Partners Horváth & Partners DLA Piper Jalsovszky Klart Szabó Legal Szabó Kelemen & Partners Attorneys

Commercial, Corporate & M&A

CMS Hegymegi-Barakonyi és Társa Baker & McKenzie Lakatos, Köves and Partners Réczicza Dentons Europe LLP Siegler Ügyvédi Iroda / Weil Gotshal & Manges LLP

Allen & Overy Andrékó Kinstellar Erős Ügyvédi Iroda/Squire Patton Boggs Faludi Wolf Theiss Forgó, Damjanovic & Partners Horváth & Partners DLA Piper Oppenheim Szabó Kelemen & Partners Attorneys Szecskay Attorneys at Law VJT & Partners

bpv Jádi Németh Attorneys at Law CLV Partners - Csabai & Partners Law Firm Conybeare Solicitors Deloitte Legal Szarvas, Erdos and Partners Law Firm Jalsovszky Kapolyi Law Firm Nagy & Trócsányi Noerr Partos & Noblet / Hogan Lovells Sándor Szegedi Szent-Ivány Komáromi Eversheds Sutherland Schoenherr Hetényi Attorneys at Law

Dispute resolution

CMS Lakatos, Köves and Partners Nagy & Trócsányi Oppenheim Réczicza Dentons Europe LLP Szecskay Attorneys at Law

Erős Ügyvédi Iroda/Squire Patton Boggs Faludi Wolf Theiss Forgó, Damjanovic & Partners Hegymegi-Barakonyi és Társa Baker & McKenzie Siegler Ügyvédi Iroda / Weil Gotshal & Manges LLP VJT & Partners

Allen & Overy CHSH Dezsö & Partners Horváth & Partners DLA Piper Lohn Law Firm Partos & Noblet / Hogan Lovells Sándor Szegedi Szent-Ivány Komáromi Eversheds Sutherland Szabó Kelemen & Partners Attorneys

Employment

CMS Forgó, Damjanovic & Partners Hegymegi-Barakonyi és Társa Baker & McKenzie VJT & Partners

Andrékó Kinstellar CLV Partners - Csabai & Partners Law Firm Faludi Wolf Theiss Horváth & Partners DLA Piper KCG Partners Law Firm Réczicza Dentons Europe LLP Szecskay Attorneys at Law

Bird & Bird bpv Jádi Németh Attorneys at Law Erős Ügyvédi Iroda/Squire Patton Boggs Kinga Zempléni Law Firm Noerr Oppenheim Sándor Szegedi Szent-Ivány Komáromi Eversheds Sutherland Schoenherr Hetényi Attorneys at Law Siegler Ügyvédi Iroda / Weil Gotshal & Manges LLP Szabó Kelemen & Partners Attorneys TaylorWessing Hungary

Intellectual property

Oppenheim SBGK Attorneys at Law Szecskay Attorneys at Law

Bird & Bird CMS Danubia Patent and Law Office LLC in cooperation with Sár & Partners Hegymegi-Barakonyi és Társa Baker & McKenzie Lakatos, Köves and Partners

Forgó, Damjanovic & Partners Horváth & Partners DLA Piper Réczicza Dentons Europe LLP Sár & Partners

Projects & Energy

CMS Faludi Wolf Theiss Horváth & Partners DLA Piper Lakatos, Köves and Partners Siegler Ügyvédi Iroda / Weil Gotshal & Manges LLP

Allen & Overy Andrékó Kinstellar CHSH Dezsö & Partners Hegymegi-Barakonyi és Társa Baker & McKenzie Oppenheim Réczicza Dentons Europe LLP

bpv Jádi Németh Attorneys at Law Forgó, Damjanovic & Partners HP Legal | Hajdu & Partners KCG Partners Law Firm Schoenherr Hetényi Attorneys at Law Szabó Kelemen & Partners Attorneys Szecskay Attorneys at Law

CMS Hegymegi-Barakonyi és Társa Baker & McKenzie Lakatos, Köves and Partners Réczicza Dentons Europe LLP

Horváth & Partners DLA Piper Oppenheim Schoenherr Hetényi Attorneys at Law Siegler Ügyvédi Iroda / Weil Gotshal & Manges LLP

Andrékó Kinstellar CHSH Dezsö & Partners Erős Ügyvédi Iroda/Squire Patton Boggs KCG Partners Law Firm Noerr Partos & Noblet / Hogan Lovells Szabó Kelemen & Partners Attorneys Szecskay Attorneys at Law

Technology, Media, Telecommunications

CMS Horváth & Partners DLA Piper

Allen & Overy Hegymegi-Barakonyi és Társa Baker & McKenzie Lakatos, Köves and Partners Réczicza Dentons Europe LLP Siegler Ügyvédi Iroda / Weil Gotshal & Manges LLP VJT & Partners

Andrékó Kinstellar Bird & Bird bpv Jádi Németh Attorneys at Law Faludi Wolf Theiss Forgó, Damjanovic & Partners Partos & Noblet / Hogan Lovells Sándor Szegedi Szent-Ivány Komáromi Eversheds Sutherland Szecskay Attorneys at Law

Tax

CMS Horváth & Partners DLA Piper Jalsovszky Hegymegi-Barakonyi és Társa Baker & McKenzie Nagy & Trócsányi

bpv Jádi Németh Attorneys at Law Deloitte Legal Szarvas, Erdos and Partners Law Firm Faludi Wolf Theiss KCG Partners Law Firm Lakatos, Köves and Partners Reti, Antall & Partners Szecskay Attorneys at Law Vámosi-Nagy Ernst & Young Law Office

Real estate & Construction

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How to run an Award-winning law Firm

We asked the managing partners of three of Budapest’s award-winning law firms the secret of their success. ROBIN MARSHALL

Our panel was comprised of: Csilla Andrékó of Andrékó Kinstellar, part of The Lawyer’s Central European Law Firm of the Year; Zoltán Faludi of Faludi Wolf Theiss, part of Chambers’ Central & Eastern Europe Law Firm of the Year; and István Réczicza of Réczicza Dentons, Hungarian national winner of the IFLR Europe Awards 2017, and part of Chambers’ European Law Firm of the Year. See also opposite for a full-page interview with András Posztl, managing partner of Horváth & Partners DLA Piper, winner of Chambers’ International Law Firm of the Year in Hungary award. What does it take to run an awardwinning law firm in Hungary? Csilla Andrékó: Kinstellar is an independent regional international law firm which is run and operated in the same style as international law firms and has a strong corporate culture based on teamwork, commitment to quality and commercial focus. I have spent my entire professional career in an international firm environment and my style of running the office is clearly shaped by the time I was a partner of a U.K. Magic Circle law firm. Running a law firm is a very complex job and requires many things done simultaneously, including running the business, running the practice, managing your colleagues, sometimes being their psychologist/mother/ friend, and having a clear vision for the future. The last one is probably the most difficult, as it is purely second-guessing

in a very challenging and rapidly changing environment in Hungary and also globally. Clients nowadays are much more sophisticated than 10-15 years ago, require their lawyers to fully understand their business, help them face market challenges and be much more flexible on, for example, pricing their legal services. We have now moved from organizing ourselves purely in practice areas to a sector approach, focusing on eight sectors where our core clients operate. So, understanding the fundamental drivers of the markets, and the business of our clients, uncovering their untold and unmet needs, and concisely demonstrating the value of what we can offer, also keeping an eye on our competitors and nurturing our talents are critical to being able to make wise management decisions.

to take pride in the collective power and success of the team. As we are approaching the tenth birthday of our firm, it gives me great pleasure to look back on the past years and see what we have achieved.

Zoltán Faludi: A highly dedicated team of smart and creative people working at the forefront of legal innovation, being involved in landmark cases, aspiring to be the “newsmakers”: – this is how I would sum up the essence of our success. For a managing partner, it is highly rewarding to assist and be involved in the career development of the young generation of great lawyers and to work in a friendly and supportive team, to see the success of others and

What are the greatest challenges? Csilla Andrékó: In Hungary, successful law firms must adapt to – and embrace – a rapidly changing business environment. Some changes are so dramatic that everybody notices them, but others may creep up on a sector or industry over the years. As new business opportunities continuously emerge, law firms need to evolve in order to stay competitive. New kinds of competence and skills need to be developed if we

LEGAL WHO’S NEWS

Dentons Budapest Announces Hires, Promotions Dentons Budapest has announced the recruitment and promotion of several legal professionals, including two new partners, which the law firm expects to strengthen and substantially enhance capabilities in M&A and Private Equity, Real Estate, Competition and Antitrust, and Litigation and Dispute Resolution in Hungary. Annamária Csenterics joins Dentons as a partner in the M&A and Private Equity

BBJ_2511_special_report.indd 28

István Réczicza: To run a firm like ours, which won the IFLR National Law Firm of the Year Award two years running and the 2017 Chambers European Law Firm of the Year award, it is essential to find and to be able to keep the best legal professionals in the country and the region. The biggest challenge for an international law firm has always been to find the right balance between motivating high-quality lawyers to integrate into a large law firm and allowing them to remain professionally independent and competitive.

want to stand out from the “crowd” and keep up with our clients. Law firms are also experiencing pressure on their fee rates and in Hungary competition is particularly severe. We need to accept that structural changes are going on in the market, and we have to be able to respond to these challenges while running a profitable business. We need to develop our legal and management skills and come up with smart solutions for providing legal services, tailored to the special needs of the clients. Digitalization is a major challenge for the legal profession, although I think that because of the relatively small size and volume of Hungarian deals, financially it won’t be feasibly for a while to replace lawyers’ work with computer programs. Finally, in my opinion, one of the key challenges for the future is to attract and maintain the best lawyers because hard work and a long-term career prospect is not so attractive for the younger generation anymore. Zoltán Faludi: Wolf Theiss concentrates its energies on a unique, constantly evolving part of the world: the complex fast developing markets of the CEE and SEE region. This regional coverage means a flourishing diversity within the firm and also distinguishes us from our competitors – and at the same time provides a great challenge to constantly deliver at a regional level. In this highly competitive business, it is difficult to compete with the prices of local law firms, but fortunately many of our clients recognize the value of seamless service across the entire region. The award we have received also puts pressure on us to maintain the same level of service day by day to be worthy of it – a pleasant but demanding task – and to strive to receive it again. István Réczicza: Apart from attracting and maintaining a legal team comprised of the best professionals, it is crucial to recognize which areas of our legal practice merit long-term investment and which areas are likely to be profitable only in the short-term. Our key focus areas have long been regulated industries, energy, infrastructure and TMT, as well as our M&A, private equity, real estate and banking practice.

Do you know someone on the move? /// Send information to news@bbj.hu

practice group with more than 20 years of experience in domestic and cross-border M&A and private equity matters. She was admitted to the bar both in Budapest and New York, and is band ranked by Chambers and Partners in M&A and private equity. Sean Huber, an English and Australian dual qualified lawyer, also joins Dentons as a senior associate in the M&A and Private Equity practice group. Previously with Freshfields and Jones Day, he has more than ten years of experience in cross-border M&A and

private equity transactions in the CEE/ CIS region. Kamran Pirani, joining from White & Case London, has also recently been recruited by Dentonsʼ Budapest team as another English-qualified M&A and PE associate.

in numerous significant real estate transactions in Hungary and across the CEE region. Additionally, Tünde Gönczöl has been promoted to counsel in the Competition and Antitrust practice group, which she also co-heads. Márk Baja has been promoted to counsel in the Litigation and Dispute Resolution practice group.

Marcell Szőnyi, previously a counsel in Dentonsʼ Budapest office, has been promoted to the position of partner in the Real Estate practice group. He focuses primarily on real estate as well as corporate and M&A, and has been involved

“These personnel moves demonstrate the importance of our Budapest office as a hub for expertise in multiple practice areas across the entire region,” said István Réczicza, Hungary Managing Partner at Dentons.

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Special Report | 29

Investing in Talent and Technology to Drive Cost Benefits and win Clients Maintaining an awardwinning law firm relies, in part, in creating a virtuous circle where clients trust you enough to bring complex, interesting work that appeals to talented legal minds who are, in turn, motivated and working at the highest levels of efficiency and quality. It sounds relatively easy, but András Posztl, managing partner of DLA Piper Hungary says it requires a lot of effort.

“We have really invested in our people, particularly the juniors and support staff, especially in internal training in legal and client management skills.” these technologies and are offering them to local clients. We offer Kira, for example, which is a due diligence AI tool for mergers and acquisitions, to review documents. The Kira software comes up with a report, which has to be reviewed and quality checked, but it can save an awful lot of time for junior lawyers, and we can pass that cost benefit on to the client. Some already expect to be offered it as a solution.” So, the digital revolution is here; the use of legal technology “has become inevitable”, Posztl warns. “In Hungary, especially in complex matters and for larger clients, law firms will have to come up with an answer to this challenge.”

Segmentation

ROBIN MARSHALL

“Success doesn’t just come and take you by surprise,” Posztl tells the Budapest Business Journal in an exclusive interview. If it did, he would be very surprised indeed, for DLA Piper Horváth & Partners Law Firm (to give its full name) has just been named Hungary Law Firm of the Year by Chambers Europe, arguably the most prestigious of the various legal awarding bodies. Very unusually, it is the second year running DLA’s Budapest office has won the title. Talent is key, of course. Good lawyers tend to attract more work. Many sectors in Hungary are experiencing labor shortages, but the country has traditionally always turned out lots of attorneys; too many, some might argue. When it came to power in 2010, the Fidesz-led government started cutting back on the number of law degrees it would support, in order to redress the balance. Does that mean there is now a shortfall here, too? “The trend is there in general,” says Posztl. “There is a smaller pool of talents; however, a higher number are approaching us.” In other words, the DLA Piper brand (the law firm was virtually unknown in Hungary when Posztl’s team

joined it in

2004),

is proving attractive, as is the type of work the Budapest office can offer. This is vital, Posztl says, as unsatisfied and ambitious lawyers can find plenty of well-paid jobs in the U.S. and U.K. markets, or move to firms like Boston Consulting or McKinsey & Co., or even

BBJ_2511_special_report.indd 29

András Posztl, managing partner of DLA Piper Hungary.

become an in-house lawyer for the sort of firms who make up DLA Piper’s client list.

Accelerated Learning

“Generation Y talents expect a quicker career path, or some variable benefit from an accelerated learning curve,” the partner explains. Fail to provide that variation in work, or that stimulating challenge, and talents will soon look elsewhere, he says, although he does not seem put out by the demands of new joiners. “This is what it is like to run an outpost of an international law firm in the 21st century in this beautiful but sometimes challenging country,” he says with a laugh. Posztl says one crucial element DLA Piper recognized early was the need to offer plenty of training, so talents can build skills quickly. “We have really invested in our people, particularly the juniors and support staff, especially in internal training in legal and client management skills.” Partly as a result, clients seem happy to bring their work to DLA Piper. “On one side or another, I can say there was no complex, high quality transaction in Budapest where we were not at least

“Generation Y talents expect a quicker career path, or some variable benefit from an accelerated learning curve.”

invited to bid for the work. [….] According to Merger Market, we also had the highest number of

transactions

in 2016.”

But customers also bring their demands. “Clients expect high quality work done in the most cost-efficient way; they are looking for a value-formoney service,” says Posztl. That is driving the innovative use of technology, though not from domestic legal offices. “International firms have invested in

These factors combined – the battle for talents and the adoption of new technologies to offer more value for money – are driving what Posztl describes as “segmentation” of the market. Smaller domestic firms may find it harder to attract and keep the key talents and invest in developing AI solutions. They may even struggle to buy off-the-shelf software, and that means they will not be able to compete in a cost benefit contest with larger international or domestic firms. That, in turn, makes it more unlikely that complex work will come the way of domestic firms, further driving talent away. The virtuous circle we talked about at the beginning for DLA Piper could have become a vicious circle for smaller local firms. “By 2025, the local [law firm] landscape could be very different,” says Posztl. “We see more and more legal regulations at an EU level and even the local level. You have to be able to digest those very quickly in order to alert clients to what is coming. You have got to be proactive when you see draft legislation that might affect a client’s business model. We are seeing a lot of articles in the legal press about the Big Four investing in legal services because they recognize the need of clients for multi-disciplinary work, but on the other hand large international law firms also tend to diversify their advisory spectrum beyond the core legal tasks.” DLA Piper, at least, is well placed to plug into these trends, but it will be a mighty achievement indeed if it is named Hungarian law firm of the year for a third consecutive year. “It is very nice to get such titles, we really appreciate them, but positive feedback from our clients is the real award. I hope we can enjoy many hundreds of those awards this year as well.”

2017. 06. 06. 13:01


Special Report

30 | 3

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Budapest Business Journal | June 2 – June 15, 2017

CEU COLUMN

The Future of Financial Trading Transparency MiFID II and MiFIR are certainly a step in the right direction in lightening dark pool trades, but the potential effects remain unclear. Cecília Bán CEU BS MBA alumna

Péter Szilágyi

Associate Professor of Finance

CEU BUSINESS SCHOOL

The last 30 years have seen dramatic changes in financial trading. Exchanges that previously featured loud and vibrant trading floors are now much quieter digital spaces, and over-thecounter (OTC) trades once handled on the phone are today routed to electronic quotation and trading systems. Those who embraced computer-assisted trading early on, like Interactive Brokers founder Thomas Peterffy and Bloomberg co-founder and former New York City Mayor Michael Bloomberg, have come out as clear winners of this change. Technological innovation has taken the depth and sophistication of financial markets to unprecedented levels. It has increased competition by removing geographic barriers and allowing real-time data access and continuous multilateral interaction. It has permitted much higher volumes to be handled much more cheaply and at much higher speed, and in customized ways that would have been impossible or too expensive before. It has let traders, many leveraging algorithmic trading, to generate fair prices and control risk more efficiently than previously imagined. In theory, at least, it has helped create data trails that regulators can follow when suspecting

illegal activity. No wonder that CEU’s professional MSc in finance guided by industry dedicates an entire course to financial trading design and technology, and runs a fintech dual degree with the MSc in technology management and innovation. With all the benefits of having technologically sophisticated financial markets, their functional weaknesses and opaqueness now driven by their complexities were laid bare by the financial crisis. A key concern has been off-exchange OTC trading, and especially “dark pool trades” enabled by the fragmentation of trading venues. Dark pool trades are offered away from the public trade feed through crossing networks and private arrangements. Since they are unreported until sometime after they have been filled, they do not show up in real-time price formation. They still contribute to price discovery if incorporated into a post-trade transparency regime, since many of these trades would not have been made in a lit market. Nonetheless, regulators are stepping up over fears of opaqueness and predatory behavior. In the United States, the Securities and

Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA) have both implemented measures to lighten dark pools. Barclays, Credit Suisse and UBS have all been fined.

New Rules The European Commission’s response has been new securities market rules that entered into force in 2014: MiFID II, the update of the 2004 Markets in Financial Instruments Directive, and MiFIR, the Markets in Financial Instruments Regulation. From 2018, the MiFID I transparency regime for shares will be extended to other equity-like instruments and non-equities including bonds, derivatives, structured products and emission allowances. Both pretrade and post-trade transparency rules will apply, with trading interests and price quotes disclosed upfront, trading caps, and executed trades published near real-time. Post-trade rules will apply to trades outside regulated trading venues and institutions that qualify as so-called systematic internalizers. Many of the provisions

are subject to waivers, exemptions, shortcuts and even interpretation. But the list goes on and the objective is clear. MiFID II and MiFIR are certainly a step in the right direction in lightening dark pool trades, but the potential effects remain unclear. It may redirect trading back to exchanges in exchangelisted shares and other instruments that have seen a surge in off-exchange OTC trading. However, there are concerns that small players will be driven out by the cost of compliance, leading to even more oligopolistic markets. Many also expect a negative impact on issuers in European bond markets. On one hand, market makers may widen sellside quotes in a primary market where pre-trade prices and trading interests must be disclosed. On the other, the Financial Times points out in a May 19 article that deals may be firewalled from retail investors due to new risk disclosure rules. It also remains to be seen how smoothly the implementation of MiFID II and MiFIR will go. It was originally scheduled to

apply from

2017,

but the European Securities and Markets Authority (ESMA) and national authorities including the National Bank of Hungary could not install essential data infrastructures in time. This column is part of a series of opinion pieces from experts at the CEU Business School in Budapest. The opinions stated here do not necessarily reflect those of the BBJ.

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Special Report | 31

Law firms with international affiliations no. of offiCes WoRldWide yeaR established hungaRian offiCe

CMS Cameron McKenna Nabarro Olswang LLP London 1779

70 1989

gabriella ormai 1053 Budapest, Károlyi utca 12. (1) 483-4800 (1) 483-4801 budapest@cms-cmno.com

Compliance, data protection, restructuring and insolvency, state aid, private equity, consumer protection, financial regulatory, project finance

DLA Piper UK LLP London 2006

More than 90 1988

andrás posztl 1124 Budapest, Csörsz utca 49–51. (1) 510-1100 (1) 510-1101 budapest@dlapiper.com

Freshfields Bruckhaus Deringer LLP London 1743

27 2007

ulrike Rein 1053 Budapest, Károlyi utca 12. (1) 486-2200 (1) 486-2201 office@oppenheimlegal.com

Infrastructure and project finance, joint ventures and private equity, capital markets, financial restructuring and insolvency

Dentons Europe LLP London 2013

More than 140 2015(1)

istván Réczicza 1061 Budapest, Andrássy út 11. (1) 488-5200 (1) 488-5299 budapest@dentons.com

Investment protection, consumer protection

Association of European Lawyers, Clifford Chance, Multilaw – –

Approx. 400 1991

péter lakatos 1075 Budapest, Madách Imre út 14. (1) 429-1300 (1) 429-1390 mail@lakatoskoves.hu

Privacy and technology, state aid, trusts, business crime

PricewaterhouseCoopers Legal LLP London 1999

100 (approx.) 2000

lászló Réti 1055 Budapest, Bajcsy-Zsilinszky út 78. (1) 461-9888 (1) 461-9898 rap.central@ hu.pwclegal.com

Capital markets, risk & compliance, non-performing loans & distressed assets, restructuring & insolvency, private equity

Kinstellar – 2008

9 2000

Csilla andrékó 1054 Budapest, Széchenyi rakpart 3. (1) 428-4400 (1) 428-4444 marketing@kinstellar.com

Capital markets, project finance, private client, wealth and asset management, consumer protection, advertising

EuroJuris, Legalink, Legus, TerraLex, World Service Group, Dorda Brugger JordisBest Friends, Biolegis, INGLF, Sate Capital Group, The Network – –

– 1992

andrás szecskay 1055 Budapest, Kossuth Lajos tér 16–17. (1) 472-3000 (1) 472-3001 info@szecskay.com

State aid, data protection

CHSH Cerha Hempel Speigelfeld Hlawati Partnerschaft von Rechtsanwälten OG Vienna 1921

9 2004

Attila Dezső, tamás polauf 1011 Budapest, Fő utca 14–18. (1) 457-8040 (1) 457-8041 office@chsh.hu

cms.law 1

48

22

11

hoRVáth & paRtneRs dla pipeR

www.dlapiper.com/hu-HU/hungary/ 42

2

10

7

oppenheim ÜgyVédi iRoda www.oppenheimlegal.com

41

3

10

16

RéCZiCZa dentons euRope llp 4

www.dentons.com

32

13

9

lakatos, kÖVes és táRsai ÜgyVédi iRoda www.lakatoskoves.hu

29

5

6

Réti, antall és táRsai pRiCeWateRhouseCoopeRs legal

28

17

14

9

8

www.retianantallpartners.hu

7

andRékó kinstellaR ÜgyVédi iRoda www.kinstellar.com

27

9

4

sZeCskay ÜgyVédi iRoda www.szecskay.com

26

8

4

16

CHSH DEZSŐ és táRsai ÜgyVédi iRoda 9

www.chsh.com/hu/offices/budapest.html

BBJ_2511_special_report.indd 31

25

7

9

name of assoCiate nonhungaRian laW fiRm oR CoopeRation netWoRk WoRld hQ yeaR established

Data protection, compliance and white-collar crime, restructuring and insolvency, automotive industry, state aid

Cms CameRon mCkenna nabaRRo olsWang llp magyaRoRsZági fióktelepe

otheR

top loCal eXeCutiVe addRess phone faX email

life sCienCes

publiC pRoCuRement

intelleCtual pRopeRty

dispute Resolution

CoRpoRate / m&a

enViRonment pRoteCtion

tmC

employment

eu

Competition

eneRgy

banking and finanCe

taX

Real estate

CommeRCial

legal speCialiity aReas no. of paRtneRs of hungaRian offiCe on may 1, 2017

no. of tRainees in hungaRy on may 1, 2017

Company Website

no. of attoRneys (With liCense to pRaCtiCe) in hungaRy on may 1, 2017

Rank

Ranked by no. of attorneys (with license to practice) in Hungary on May 1, 2017

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Budapest Business Journal | June 2 – June 15, 2017

name of assoCiate nonhungaRian laW fiRm oR CoopeRation netWoRk WoRld hQ yeaR established

no. of offiCes WoRldWide yeaR established hungaRian offiCe

Mining law, trust, workout

Ecovis International Berlin 2004

190 1991

Péter Kesseő-Balogh 1036 Budapest, Bécsi út 52. (1) 439-1166 (1) 439-1155 law@ecovis.hu

Corporate restructuring and insolvency, gaming and betting, IT, telecommunications, e-commerce, mediation

Ally Law Minneapolis, USA 1990

65 1996

tamás szabó 1024 Budapest, Lövőház utca 39. (1) 288-8200 (1) 288-8299 tamas.szabo@sz-k-t.hu

Compliance, data protection, consumer protection, restructuring and insolvency, private equity

Baker & McKenzie LLP Chicago 1949

77 1987

Zoltán Hegymegi-Barakonyi 1051 Budapest, Dorottya utca 6. (1) 302-3330 (1) 302-3331 budapestinfo@ bakermckenzie.com

Wolf Theiss Rechtsanwälte GmbH Vienna 1957

13 2007

Zoltán faludi 1085 Budapest, Kálvin tér 12–13. (1) 484-8800 (1) 484-8825 budapest@wolftheiss.com

Lex Mundi Houston, USA 1989

600 1991

Péter Berethalmi 1126 Budapest, Ugocsa utca 4/B (1) 487-8700 (1) 487-8701 budapest_office@nt.hu

Weil, Gotshal & Manges LLP New York 1931

19 1991

david dederick 1054 Budapest, Szabadság tér 7. (1) 301-8900 (1) 301-8901 david.dederick@weil.com

Compliance, white-collar crime, insolvency and restructuring, capital markets, data protection

Schönherr Rechtsanwälte GmbH Vienna 1950

14 2008

Kinga Hetényi 1133 Budapest, Váci út 76. (1) 870-0700 (1) 870-0701 office.hungary@ schoenherr.eu

Pharmaceutical law

Conference Bleue Alliance Brussels 2006

21 2007

Kornélia Nagy-Koppány, István Varga 1051 Budapest, Vigadó utca 2. (1) 302-9050 (1) 302-9060 knplaw@knplaw.com

International Lawyers Network Westwood, USA 1988

91 2005

pál Jalsovszky 1124 Budapest, Csörsz utca 41. (1) 889-2800 (1) 886-7899 office@jalsovszky.com

otheR

top loCal eXeCutiVe addRess phone faX email

life sCienCes

publiC pRoCuRement

intelleCtual pRopeRty

dispute Resolution

CoRpoRate / m&a

enViRonment pRoteCtion

tmC

employment

eu

Competition

eneRgy

banking and finanCe

taX

Real estate

CommeRCial

legal speCialiity aReas no. of paRtneRs of hungaRian offiCe on may 1, 2017

Company Website

no. of tRainees in hungaRy on may 1, 2017

Special Report no. of attoRneys (With liCense to pRaCtiCe) in hungaRy on may 1, 2017

Rank

32 | 3

eCoVis hungaRy legal www.ecovis.hu 9

25

8

9

sZabó, kelemen és táRsai ÜgyVédi iRoda 9

www.sz-k-t.hu

25

4

4

hegymegi-baRakonyi és táRsa bakeR & mCkenZie ÜgyVédi iRoda 10

www.bakermckenzie.com

23

15

9

faludi Wolf theiss ÜgyVédi iRoda 11

www.wolftheiss.com

20

8

3

nagy & tRóCsányi ÜgyVédi iRoda 11

www.nt.hu

20

7

10

siegleR ÜgyVédi iRoda / Weil, gotshal & manges llp www.weil.com 11

20

7

2

sChÖnheRR hetényi ÜgyVédi iRoda www.schoenherr.eu

17

12

7

4

knp laW nagy koppany VaRga and paRtneRs 13

www.knplaw.com

16

5

3

JalsoVsZky

www.jalsovszky.com 14

15

4

3

Hegymegi-Barakonyi és Társa Baker & McKenzie Ügyvédi Iroda

30 YEARS IN HUNGARY.

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sándoR sZegedi sZent-iVány komáRomi eVeRsheds sutheRland 14

www.eversheds-sutherland.hu

15

3

9

otheR

life sCienCes

publiC pRoCuRement

intelleCtual pRopeRty

dispute Resolution

CoRpoRate / m&a

enViRonment pRoteCtion

tmC

employment

eu

Competition

eneRgy

banking and finanCe

taX

Real estate

CommeRCial

no. of paRtneRs of hungaRian offiCe on may 1, 2017

no. of tRainees in hungaRy on may 1, 2017

no. of attoRneys (With liCense to pRaCtiCe) in hungaRy on may 1, 2017

Rank

Company Website

legal speCialiity aReas

Immigration, data protection, regulatory compliance, administrative law

Eversheds Sutherland London, Atlanta 1988 (UK), 1924 (US)

Allen & Overy London 1930

allen & oVeRy 15

www.allenovery.com

14

6

2

Special Report | 33

no. of offiCes WoRldWide yeaR established hungaRian offiCe

3

name of assoCiate nonhungaRian laW fiRm oR CoopeRation netWoRk WoRld hQ yeaR established

www.bbj.hu

Budapest Business Journal | June 2 – June 15, 2017

top loCal eXeCutiVe addRess phone faX email

61 1987/1999

Ágnes Szent-Ivány 1026 Budapest, Pasaréti út 59. (1) 394-3121 (1) 392-4949 office@ eversheds-sutherland.hu

44 1993

Zoltán Lengyel 1075 Budapest, Madách Imre út 13–14. (1) 483-2200 (1) 268-1515 –

Ÿ

katalin szamosi 1062 Budapest, Andrássy út 113. (1) 461-1000 (1) 461-1099 mailbox@sbgk.hu

sbgk ÜgyVédi iRoda www.sbgk.hu

14

15

5

6

bnt ügyvédi iroda 13

paRtos & noblet in Co-opeRation With hogan 16 loVells inteRnational llp

13

4

6

8

3

Ÿ

1969

Data processing and privacy, compliance, pharma, insolvency and restructuring

bnt attorneys in CEE – –

10 2003

Norbert Varga, Rainer tom 1143 Budapest, Stefánia út 101–103. (1) 413-3400 (1) 413-3413 info.hu@bnt.eu

Capital markets

Hogan Lovells International LLP London, Washington 1899/1904

50 2006

lászló partos 1051 Budapest, Vörösmarty tér 7–8. (1) 505-4480 (1) 505-4485 office@hoganlovellls.co.hu

Securities and stock exchange law, data protection

Ernst & Young Law Germany 2002

76 2010

iván sefer 1132 Budapest, Váci út 20. (1) 451-8100 (1) 451-8199 law@hu.ey.com

State aid advisory services, greenfield investment advisory, compliance, data privacy and digitalization, automotive sector specialization

16 1990

Zoltán nádasdy, Jörg K. Menzer 1011 Budapest, Fő utca 14–18. (1) 224-0900 (1) 224-0495 recepcio@noerr.com

www.bnt.eu 16

AIPEX Munich

www.hoganlovells.com

Vámosi-nagy eRnst & young ÜgyVédi iRoda a membeR fiRm of ey global www.eylaw.hu

13

16

12

2

noerr & társai iroda www.noerr.com 17

12

2

4

Noerr LLP Munich 1950

Thinking without boundaries The global legal brand that sets the standards Today’s business world is increasingly complex, with rapidly changing laws and regulations. Eversheds Sutherland is a full service international legal brand that will help you to meet the challenges of the change and give you the answers that allow you to prosper. If you need legal assistance in Hungary, contact us:

SÁNDOR SZEGEDI SZENT-IVÁNY KOMÁROMI EVERSHEDS SUTHERLAND Attorneys at Law T:+36 1 394 3121 office@eversheds-sutherland.hu H-1026 Budapest, Pasaréti út 59.

eversheds-sutherland.hu

© Eversheds Sutherland 2017. All rights reserved. DTUK000771_05/17

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12

11

2

Cathay Associates KeJie Beijing 2009

44 2007

Rupert Várnai 1037 Budapest, Szépvölgyi út 141. (1) 920-2040 (1) 247-2120 budapest@ cathayassociates.com

Telecommunication law

Norton Rose Fulbright LLP London 1794

More than 50 1989

eszter dávid 1013 Budapest, Pauler utca 11. (1) 354-4300 (1) 354-4399 office@bpss.hu

Insurance law

ADVOC London 1990

94 1992

istván gárdos 1056 Budapest, Váci utca 81. (1) 327-7560 (1) 327-7561 postmaster@gfmt.hu

bpv LEGAL – 2006

7 2000

Andrea Jádi Németh 1051 Budapest, Vörösmarty tér 4. (1) 429-4000 (1) 429-4001 budapest@bpv-jadi.com

IBLC (International Business Law Consortium) Salzburg 1998

90 1997

Chrysta Bán, péter s. szabó 1051 Budapest, József nádor tér 5–6. (1) 266-3522 (1) 266-3523 office@bansszabo.hu

Compliance, data protection, consumer protection, bankruptcy and liquidation, project financing, joint ventures and private equity, capital markets

Squire Patton Boggs (US) LLP Washington 1890

46 1991

Ákos Erős 1051 Budapest, Széchenyi István tér 7–8. (1) 428-7111 (1) 428-7000 budapest@squirepb.com

Mackrell International Woking, UK 1987

160 1990

andrás moldován 1051 Budapest, Dorottya utca 1. (1) 328-6010 (1) 328-6011 info@moldovan.hu

Rödl & Partner GbR Wirtschaftsprüfer, Steuerberater, Rechtsanwälte Nuremberg 1977

108 1992

sándor sárközy, stefan sieferer 1062 Budapest, Andrássy út 121. (1) 814-9880 (1) 814-9898 budapest@roedl.hu

Aviation law

LUTHER Rechtsanwaltsgesellschaft mbH Cologne 1992

18 2014

attila fest 1054 Budapest, Báthory utca 8. (1) 791-7060 (1) 791-7065 office@festandpartner.hu

Conybeare Solicitors, Gowling WLG, Berwin Leighton Paisner London 1997/2016/2001

1/18/14 2008

lászló hajdu 1013 Budapest, Pauler utca 11. (1) 799-8230 (1) 799-8231 office@hplegal.eu

Banking and finance, mergers and acquisitions, real estate law, energy law, tax litigation

Data privacy, marketing law, consumer protection

www.deloittelegal.hu

Cathay assoCiates VáRnai és táRsa 17 ÜgyVédi iRoda

12

3

www.cathayassociates.com

name of assoCiate nonhungaRian laW fiRm oR CoopeRation netWoRk WoRld hQ yeaR established

75 2009

Gábor Erdős 1068 Budapest, Dózsa György út 84/C (1) 428-6800 (1) 428-6801 deloitteinhungary@ deloittece.com

otheR

top loCal eXeCutiVe addRess phone faX email

life sCienCes

publiC pRoCuRement

intelleCtual pRopeRty

dispute Resolution

CoRpoRate / m&a

enViRonment pRoteCtion

tmC

employment

eu

Competition

eneRgy

banking and finanCe

taX

Real estate

CommeRCial ✓

no. of offiCes WoRldWide yeaR established hungaRian offiCe

deloitte legal ERDŐS ÉS TÁRSAI 17 ÜgyVédi iRoda

www.bbj.hu

Budapest Business Journal | June 2 – June 15, 2017

legal speCialiity aReas no. of paRtneRs of hungaRian offiCe on may 1, 2017

Company Website

no. of tRainees in hungaRy on may 1, 2017

Special Report no. of attoRneys (With liCense to pRaCtiCe) in hungaRy on may 1, 2017

Rank

34 | 3

Deloitte Legal

Ÿ Ÿ

bpss ÜgyVédi iRoda www.bpss.hu

12

17

gáRdos fÜRedi mosonyi 17 tomoRi ÜgyVédi iRoda www.gfmt.hu

bpv Jádi németh 18 ÜgyVédi iRoda www.bpv-jadi.com

bán, s. sZabó & paRtneRs 18 ÜgyVédi iRoda www.bansszabo.hu

12

11

11

5

2

4

1

9

8

4

7

ERŐS ÜGYVÉDI IRODA/SQUIRE patton boggs (us) llp www.squirepattonboggs.com

11

18

1

3

moldoVán és táRsai ÜgyVédi iRoda 19

www.moldovan.hu

sáRkÖZy RÖdl & paRtneR ÜgyVédi iRoda, RÖdl & paRtneR ÜgyVédi 19 táRsulás www.roedl.de

10

10

3

3

2

2

fest és táRsa ÜgyVédi iRoda 20

www.festandpartner.hu

9

2

2

hp legal haJdu & paRtneRs laW fiRm www.hplegal.eu 20

BBJ_2511_special_report.indd 34

9

2

2

2017. 06. 06. 13:01


sáR és táRsai ÜgyVédi iRoda 20

www.sarandpartners.hu

9

5

7

Data protection, e-commerce and internet law, software law, advertisement law

Mining law, renewable energy law, state subsidies, higher education law, clusters

MSI Global Alliance London 1990

European Law Firm Eindhoven, the Netherlands 1989

PONTES – 2005

desseWffy és dáVid Valamint táRsaik ÜgyVédi iRoda www.dessewffy.com

8

21

21

kapolyi ÜgyVédi iRoda www.kapolyi.com

pontes budapest 21 ÜgyVédi iRoda www.ponteslegal.eu

klaRt legal 21 ÜgyVédi táRsulás www.klartlegal.hu

bánki és táRsai ÜgyVédi iRoda koopeRáCióban a tayloRWessing e|n|w|c natlaCen WaldeRdoRff CanCola ReChtsanWÄlte 22 gmbh-Val www.taylorwessing.com

8

8

8

7

2

5

3

1

3

3

1

3

3

5

otheR

life sCienCes

publiC pRoCuRement

intelleCtual pRopeRty

dispute Resolution

CoRpoRate / m&a

enViRonment pRoteCtion

tmC

employment

eu

Competition

eneRgy

banking and finanCe

taX

Real estate

CommeRCial

no. of paRtneRs of hungaRian offiCe on may 1, 2017

no. of tRainees in hungaRy on may 1, 2017

no. of attoRneys (With liCense to pRaCtiCe) in hungaRy on may 1, 2017

Rank

Company Website

legal speCialiity aReas

sZéCsényi és táRsai ÜgyVédi táRsulás 22

www.szecsenyi.com

foRgó, damJanoViC és

22 táRsai ÜgyVédi iRoda www.fdlaw.hu

7

7

5

4

3

4

Special Report | 35

Gambling

EPLAW

Ÿ Ÿ

IBA (International Bar Association)

Ÿ Ÿ

TaylorWessing e|n|w|c Natlacen Walderdorff Cancola Rechtsanwälte GmbH Vienna 1986

Cyrus Ross Brussels

Ÿ

The Harmony Group Minneapolis, USA 1993

Real estate investments, ESOP, financial regulatory and compliance

Independent Legal Alliance, MME Legal Tax Compliance Zurich 2014

Ius Laboris Global HR Lawyers Brussels 2001

no. of offiCes WoRldWide yeaR established hungaRian offiCe

3

name of assoCiate nonhungaRian laW fiRm oR CoopeRation netWoRk WoRld hQ yeaR established

www.bbj.hu

Budapest Business Journal | June 2 – June 15, 2017

top loCal eXeCutiVe addRess phone faX email

Ÿ

ildikó komor hennel 1051 Budapest, Bajcsy-Zsilinszky út 16. (1) 457-0550 (1) 214-8419 office@sarandpartners.hu

118 1992

alice dessewffy 1126 Budapest, Nagy Jenő utca 12. (1) 413-3340 (1) 413-3341 office@dessewffy.com

27 1998

József Kapolyi 1051 Budapest, József nádor tér 5–6. (1) 267-3975 (1) 267-3949 info@kapolyi.com

7 2005

Gábor Bebők 1011 Budapest, Szilágyi Dezső tér 1. (1) 799-0140 (1) 799-0141 admin@hunlaw.hu

Ÿ

levente antal szabó 1011 Budapest, Corvin tér 10. (1) 796-3600 (1) 796-3636 info@klartlegal.eu

33 1995

orsolya bánki 1051 Budapest, Dorottya utca 1. (1) 327-0407 (1) 327-0410 budapest@ taylorwessing.com

19 1996

lászló szécsényi 1024 Budapest, Buday László utca 12. (1) 345-4535 (1) 345-4543 office@szecsenyi.com

77 2000

Zoltán Forgó, gábor damjanovic 1123 Budapest, Alkotás utca 17–19. (1) 214-0080 (1) 214-0078 office@fdlaw.hu

12 2014

eszter kamocsay-berta 1054 Budapest, Széchenyi rakpart 8. (1) 301-3130 (1) 269-0016 reception@ kcgpartners.com

125 2003

marianna Csabai 1126 Budapest, Tartsay Vilmos utca 3. (1) 488-7008 (1) 488-7009 info@clvpartners.com

1998

2014

kCg paRtneRs ÜgyVédi táRsulás www.kcgpartners.com

7

22

ClV paRtneRs Csabai és táRsai 22 ÜgyVédi iRoda www.clvpartners.com

BBJ_2511_special_report.indd 35

7

4

1

4

3

2017. 06. 06. 13:01


www.bbj.hu

no. of offiCes WoRldWide yeaR established hungaRian offiCe

otheR

life sCienCes

publiC pRoCuRement

intelleCtual pRopeRty

dispute Resolution

CoRpoRate / m&a

enViRonment pRoteCtion

tmC

employment

eu

Competition

eneRgy

banking and finanCe

taX

Real estate

CommeRCial

name of assoCiate nonhungaRian laW fiRm oR CoopeRation netWoRk WoRld hQ yeaR established

Budapest Business Journal | June 2 – June 15, 2017

legal speCialiity aReas no. of paRtneRs of hungaRian offiCe on may 1, 2017

Company Website

no. of tRainees in hungaRy on may 1, 2017

Special Report no. of attoRneys (With liCense to pRaCtiCe) in hungaRy on may 1, 2017

Rank

36 | 3

top loCal eXeCutiVe addRess phone faX email

BWSP, Globalaw Berlin 2012/1994

6 2002

arne gobert 1134 Budapest, Róbert Károly körút 70–74. (1) 270-9900 (1) 270-9990 office@gfplegal.com

Jeantet A.A.R. P.I. Paris 1924

7 2015

francois d'ornano 1051 Budapest, Széchenyi István tér 7–8. (1) 411-7400 (1) 411-7440 contact.budapest@ jeantet.org

Norton Rose Fulbright London

Ÿ

Károly Varga 1065 Budapest, Bajcsy-Zsilinszky út 53. (1) 302-9090 (1) 302-9092 halcsi@t-online.hu

57 2010

Gergely Bán, márton karika 1117 Budapest, Alíz utca 1. (1) 501-5360 (1) 501-5361 office@ban-karika.hu

bWsp gobeRt és táRsa ÜgyVédi iRoda www.gobertpartners.com 23

23

6

Jeantet - d'oRnano iRoda www.jeantet.fr

VaRga káRoly és táRsa 23 ÜgyVédi iRoda –

6

6

5

4

1

2

2

2

Entertainment

Ÿ

1998

bán és kaRika ÜgyVédi táRsulás www.ban-karika.hu

5

24

4

2

LAWorld Spain 1997

TELFA (The Trans European Law Firms Alliance) Brussels 1989

Customs law, EU customs law, insolvency and enforcement law, food law, commercial law, antitrust law

Schrömbges + Partner Partnerschaftsgesellschaft Rechtsanwälte Steurerberater mbH, Schulyok Unger & Partner Rechtanwälte OG Hamburg, Vienna 2008 / 1996

2 2005

géza katona 1125 Budapest, Fészek utca 16. (1) 225-2530 (1) 202-2842 central@katonalaw.com

Peterka & Partner advokátní kancelář s.r.o. Prague 2000

9 2013

ádám kollár, Veronika till 1051 Budapest, Vörösmarty tér 4. (1) 235-1090 (1) 235-1099 office@peterkapartners.hu

Studio Legale De Capoa e Associati Bologna, Italy 1986

6 2000

krisztina salló 1055 Budapest, Honvéd utca 38. (1) 312-1683 (1) 269-2999 budapest@decapoa.com

Data protection, sports

Bird & Bird LLP London 1846

28 2008

Peter Knight 1054 Budapest, Szabadság tér 14. (1) 799-2000 (1) 799-2088 budapest@twobirds.com

Data protection

World Link for Law Zurich 1989

80 2008

Balázs Lohn 1053 Budapest, Károlyi utca 12. Ybl-palota II. em. (1) 999-1233 (70) 902-1288 info@lohn.hu

Telecommunications and e-commerce

Warwick Legal International Network Canterbury, UK 2001

55 1997

Thomas A. Squarra 1016 Budapest, Avar utca 8. (1) 474-2080 (1) 474-2081 info@squarra.hu

bihaRy, balassa ÜgyVédi iRoda

www.biharybalassa.hu 5

24

katona és táRsai 24 ÜgyVédi iRoda www.katonalaw.com

24

peteRka & paRtneRs iRoda www.peterkapartners.com

salló ÜgyVédi iRoda 24 www.decapoa.com

knight biRd & biRd iRoda 24 www.twobirds.com

5

5

5

5

2

1

4

2

3

2

2

6

26

Ÿ

lohn ÜgyVédi iRoda www.lohn.hu

4

25

sQuaRRa & paRtneRs 25 ÜgyVédi iRoda www.squarra.hu

Ÿ= would not disclose, NR = not ranked, NA = not applicable

4

9

1

3

3

Tibor Bihary 1026 Budapest, Pasaréti út 83. (1) 391-4491 (1) 200-8047 office@biharybalassa.hu

This list was compiled from responses to questionnaires received by May 31, 2017 and publicly available data. To the best of the Budapest Business Journal’s knowledge, the information is accurate as of press time. While every effort is made to ensure accuracy and thoroughness, omissions and typographical errors may occur. Additions or corrections to the list should be sent on letterhead to the research department, Budapest Business Journal, 1075 Budapest, Madách Imre út 13–14., or faxed to (1) 398-0345. The research department can be contacted at research@bbj.hu.

NOTES: (1) Dentons (formerly Salans) have been in Budapest since 2006.

BBJ_2511_special_report.indd 36

2017. 06. 06. 13:01


4

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Socialite

Budapest Business Journal | June 2 – June 15, 2017

Discovering Transylvania in Budapest

Photo: MTI / Noémi Bruzák

David Holzer discovers that not even the rain can deter Hungarians from enjoying Székely folklore, and sets out to try and discover why that might be. DAVID HOLZER

It was raining hard by the time we got to the Székely festival at the Millenáris in Buda. But that didn’t bother the families streaming through the gate, past stalls selling grilled meat and blue and gold flags. There was even a bedraggled audience for the folk dancers. Székely refers to the tiny area known as Székelyföld (Székely Land) in Transylvania. In 1920, as part of the Trianon treaty that broke up Austro-Hungary after World War I, this region was given to Romania. I bought a beautiful blue and white cross, unlike anything I’d ever seen before. Apparently, each part of Transylvania paints its crosses differently. Mine was a Kászoni Székely kereszt (cross). As we were walking away, Ildikó ran up to us and gave me a metal badge showing the golden sun and silver crescent moon of Székely. I took it as a sign. We stopped and listened while an old man played a haunting tune on a wooden flute that made me quite forget where I was. He paused, took a sip from a glass of something potent-looking in front of him. Perhaps he wasn’t quite sure where he was either. We had our photo taken in Transylvanian costume at one of those face in the hole boards, next to a stuffed bear. I have a rather strange glint in my eye. I’m pondering the myth of Transylvania, which has always intrigued me. I don’t think Hungarians realize just how fascinated we Brits and Americans are by Transylvania.

Dracula and Vlad It started for me because, like most of us, I believed that Irish author Bram Stoker had based his 1897 Dracula novel on Vlad the Impaler. After all, Wallachian warlord Vlad III was a member of the House of Drăculești and his title is “Voivode [ruler] Dracula” in English. And both Vlad and the fictional Dracula fought against the Turks. In Romania, despite his brutality, Vlad is widely regarded as a just ruler. Even if, in modern Romanian, “drac” means devil. It would appear, however, that the assumption that Dracula was inspired by Vlad was actually made by researcher Basil Kirtley in 1958. Kirtley pointed to the shared name Dracula. But Irving Stoker, Bram’s son, claimed that the story of

BBJ_2511_socialite.indd 37

Dracula came to his father in a nightmare “after eating too much dressed crab”. A more plausible theory is that Stoker read Scottish author Emily Gerard’s 1885 essay “Transylvanian Superstitions”. In this, she refers to the “decidedly evil… vampire or nosferatu, in whom every Roumenian [sic] peasant believes as firmly as he does in heaven or hell”. Emily became familiar with Transylvanian folklore after her husband, Chevalier Mieczislas de Laszowski, a Polish cavalry officer serving in the Austro-Hungarian Army was stationed in Nagyszeben, then part of Austro-Hungary. Nosferatu is, of course, the name of the enormously influential

1922

expressionist

movie by FW Murnau. An unauthorized adaptation of Stoker’s Dracula, it wasn’t a commercial success because of copyright issues. But it made a big impact in Hollywood. Murnau moved to the States in 1926 and went to work for Fox Studios. As any good Hungarian knows, Fox was founded by Wilhelm Fried Fuchs, born in Tolcsya, a village in the far northeast of Hungary. The films made by German expressionist directors like Murnau were devoured in Hollywood and went on to influence horror movies and film noir.

was because he looked the part but also because his thick Hungarian accent limited the roles he could plausibly play. Tragically, Lugosi ended up as a morphine addict forced to appear in rubbish like Ed Wood’s zero-budget 1959 “Plan 9 from Outer Space” to feed his habit. Today, in a nice twist, the real Transylvania is a popular location for Hollywood movies. “Cold Mountain”, for instance, was shot in Râșnov. The town boasts its own splendidly kitsch version of the Hollywood sign, at the base of the citadel that overlooks its ancient cobbled streets. It’s clear, then, that the myth of Transylvania remains highly powerful. But what about the reality? Our friend Sándor is a frequent visitor to the country. I asked him why. “For Hungarians, Székelyföld is like a stem cell. In its people, we see our older Hungarian cultural values more clearly and purely. They haven’t changed as much as we have. I feel like I was born there, not Hungary. I go a couple of times a year, including to the Tusványos festival, which happens in late July. When I go to

Székelyföld, it’s as if I’m returning home. I miss it when I’m not there.” Apart from the people, Sándor loves the beautiful landscape. “There are the Carpathian Mountains to hike in, castles, churches and beautiful villages as well as spas, thermal baths and therapeutic salt mines. My favorite place is a village called Vargyas in Kovászna Megye.” Thinking about the stuffed bear we saw at the Székely festival, I asked Sándor if there were still bears in Transylvania. “Of course,” he said. “But I’ve been going for years and this was the first year I actually saw a bear in the wild. In any case, bears only attack if they feel threatened. A friend of mine saw one when he was out bicycling a few weeks ago and it just watched him go past. I’m sure he went a bit faster, though.” What about the food? “I love the csorba soup, which is truly Transylvanian. I also like the mici, the grilled meat rolls. And the Köményes pálinka is very good. It starts at 50% proof, so it’s much stronger than ours.” I think this was what the old man playing the wooden flute at the Székely festival was drinking. After talking to Sándor, I understood why a rainy Saturday morning in Buda was no deterrent to the Hungarians visiting the Székely festival. As happens so often in this country, I envy the fierce pride Hungarians have in their folk culture. I’ve yet to see Transylvania, but Sándor makes it sound every bit as beautiful and wild as the myth. And I have to see the sign at Râșnov, as well as maybe a bear or two.

Find out more about the cultic Tusványos festival at www.tusvanyos.ro For excellent Transylvanian food in Budapest, try Kárpátia at Ferenciek tere 7-8.

PROMOTION

Collective Imagination Although Hollywood created the modern myth of the vampire, it’s worth remembering that cultures as far back as the Mesopotamians, Hebrews, Ancient Greeks and Romans believed in them. But, the casting of Hungarian actor Bela Lugosi – AKA Béla Ferenc Dezső Blaskó – as Dracula in the 1931 film certainly helped cement the idea of vampires as especially Eastern European in the collective imagination of movie audiences. Lugosi, who arrived in the States as a seaman on a merchant ship, went on to become a horror movie great. This

We are happy to announce that KANPAI IZAKAYA, at

SZENT ISTVÁN KRT. 17. IN DISTRICT FIVE, is currently going

under renovation work, and will be relaunched with the new name of CHIYOKO (Asian food bar) AS OF JUNE 1, offering new menu and even higher standards than earlier, awaiting our returning and new guests. On the day of opening and the following weekend (June 1-4) everybody who orders food at our bar will receive an alcoholic or alcohol-free Japanese cocktail for free of charge.

2017. 05. 31. 18:30


38 | 5

Socialite

www.bbj.hu

Budapest Business Journal | June 2 – June 15, 2017

Staying in the Pink This Summer

With the ubiquitous Kékfrankos grape, replete with its lively red fruit and vibrant acidity, Hungary is well-equipped to make refreshing rosé, just the ticket for a balmy Budapest summer evening. Many wineries actually choose to build on Kékfrankos’ crispy base with a few percent of some other grapes which either offer a touch more weight or different flavor spectrums to flesh out the fruit. ROB SMYTH

Up in the relatively cool north-eastern climate of Eger, János Bolyki made his 2016 rosé from around

70%

Kékfrankos

70% Kékfrankos and 30% Merlot. It is zesty and fresh but also with good mouthfeel, ripe strawberry on the nose and palate, as well radiating a pleasingly pink color. In addition to Kékfrankos, down in the warmer climes of Szekszárd, the Sebestyén cellar also worked in the PROMOTION

BBJ_2511_socialite.indd 38

über fruity Zweigelt and spicy Syrah. The grapes were given two-three hours of skin contact and the resulting wines were blended later. This one has juicy summer peach on the nose and palate, in addition to the usual raspberry and strawberry. It is round and balanced and the touch of carbon dioxide further refreshes the finish. The Zweigelt gives this otherwise pale colored rosé a smidgen of purple. Csilla Sebestyén, who runs the winery together with her brother, Csaba, describes 2016 as an ideal vintage for rosé since it didn’t get too hot, thus preserving the all-important acidity. Incidentally, Zweigelt is the crossing of Kékfrankos (or Blaufränkisch, to give it its Austrian name) with St. Laurent, created by Dr. Fritz Zweigelt in 1922 at the Teaching and Research Center for Viticulture and Horticulture (LFZ) in Klosterneuburg, Austria. A late entrant to the rosé game is Heimann, also from Szekszárd, and the family’s aim is to make a fuller style, which it managed with aplomb in 2016 with a blend of Syrah, Pinot Noir, Merlot, Kékfrankos and Kadarka – the latter being a signature Szekszárd grape that’s

renowned for its fragrant fruit and spice. Heimann’s Mammaróza Rozé 2016 captures Szekszárd’s full-on fruitiness, which is likely due to a combination of the agreeably warm climate and loess soil. It exudes ripe raspberry, grapefruit and rhubarb, and is full-bodied for rosé but still fresh, and its deeper pink color gives a clue about it more concentrated character. The Pinot Noir grapes were grown specifically to make rosé, while the Syrah and Merlot were plucked preregular harvest from the vines growing grapes that were otherwise harvested later to make red wine, explains Zoltán Heimann Jr. All of these were given twothree hours of skin contact. Meanwhile, the Kékfrankos was made via the saignée method (i.e. “bled off” from the red wine after one night of maceration). From Balatonboglár, on the southern side of Lake Balaton, a go-to rosé has long been from Konyári, whose 2016 sees a double act of Merlot and Kékfrankos, supported by a backing band of Malbec (an extremely rare red grape in Hungary), Cabernet Franc and Syrah, to bring a mouth-watering mélange of various fruit and spice. I am sad to report that János Konyári, who championed the red wine cause in south Balaton and has made some of Hungary’s finest red wines period, passed away after a long illness in May, at the age of 66. This groundbreaking winemaker, who was also consultant at the larger IKON winery, leaves the family business in the extremely capable hands of his son Dániel, who has been making the wine in close tandem with his father for years. One winery that has decided to play to the strengths of its terroir and devote almost all its attention to rosé is Nagygombos from the Mátra wine region. Owner Károly Barta, who is also the proprietor of the eponymously named Barta winery in the Tokaj region, asserts that the climate isn’t quite warm enough to make consistently high quality red wine but is ideal for rosé. He says that, whichever way the vineyards face, the resulting rosé wines always capture nice

acidity and the limestone nyirok and sandy loess soils help develop the allimportant fragrant fruity aromas. The wines are made by his daughter Anna Tákacs-Barta, who keeps the rosés back from release until spring, when she feels they are sufficiently developed. They work with an array of grapes, including even Gamay of Beaujolais fame.

Gróf Grassalkovich Gamay Noir rosé 2016 Some have compared the Kékfrankos grape to the Gamay (full name Gamay Noir) of Beaujolais, so it’s interesting to see how it weighs up in Mátra terroir. Half of it was fermented and aged in used oak barrels and the other half in tank, with the time in oak bringing more in the way of texture. Thankfully, the oak doesn’t override the fruit and it still has plenty of Gamay’s primary grapey appeal. Nice acidity, good fruit and distinctive. A great buy at HUF 1,400 from Artizan (www.sorfront.hu). Note that such a wine can also age and the 2015, a quarter of which was vinified in oak, is currently in great shape and well worth picking up.

Funky Fuxlis Down to a Half Dozen in 2016 Siller, which is usually made with two or three days of skin contact during which some color and tannin are extracted from the grapes, serves to bridge the gap between rosé and red wine. Szekszárd’s Fuxli category is intended to denote premium quality Siller, although some producers of very good Siller decide not to put their wines forward for consideration. Just six 2016 wines have been released as Fuxli this year, but they are a fine half dozen, all exuding different qualities and characteristics. They are made by Eszterbauer, Garai, Heimann, Hetényi, Sebestyén and Takler. Fuxli can be a blend or made from a single varietal with Kékfrankos and Kadarka usually in the mix, but all the important red grapes in the region can come into play. HUF 9,000 from Bortársaság for the six.

2017. 05. 31. 18:30


Socialite | 39

5

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Budapest Business Journal | June 2 – June 15, 2017

Planetarium’s 40th Anniversary Gift is Closure

Budapest’s planetarium is closing its doors in its 40th year of operation because the building is in a dangerous condition, while its technology has long been obsolete. The institution desperately needs the Hungarian state to step in with public money, which Henrik Lőrincz tells the Budapest Business Journal could happen, if a decision is made this fall. CHRISTIAN KESZTHELYI

The TIT Planetárium Budapest building in the trees of the beautiful Népliget looks like a long-forgotten memento of post-war times. As the visitor steps into the building, it feels as if you have traveled back in time a few decades. The huge, almost two-ton German projector in the midst of the 23-meter-diameter dome will actually

turn

50

next year. “If we enter the planetarium today, we do not enter the future but the past,” Lőrincz says of the institution with a passion one would expect from an astronomer and presenter who works there. He argues that, rather than the history of space, people are interested in the future and want to learn about traveling to Mars, for example. “We do not want to be a museum,” Lőrincz insists. The Hungarian planetarium opened its doors on August 20, 1977, after long years of planning. Hungarian astronomer György Kulin had promoted the idea much earlier, but the debate over the location of the institution meant the Zeiss Universal

Henrik Lőrincz.

ll planetarium projector, manufactured in 1968, sat in its box for several years. At various times, Gellért Hill, Városliget and Népliget were suggested. Eventually, the building was constructed at its present site based on the plans of architects from the Budapest University of Technology and Economics (BME). Although the technology in the institution is old, it could still run shows if the roof structure was not in such a poor condition that even light rain leads to many leaks. The operator, Tudományos Ismeretterjesztő Társulat (TIT or Society for Dissemination of Scientific Knowledge), a non-profit organization, says the conditions are dangerous; it will close the planetarium in June, at least, until the roof can be renovated.

approximately 95% of its technology is 40 years old. However, TIT does not generate enough money to cover those costs. “A planetarium does not offer a bonanza business anywhere. It is an educational institution that is closer to a school in nature than a cinema,” Lőrincz tells the BBJ. The planetarium has around 100,000 visitors annually, a figure that has been steady over the past few years. With ticket prices at around HUF 1,0001,500, the planetarium can anticipate an estimated annual revenue of HUF 100 million, according to the on-spot estimates of Lőrincz. “No such profit is made here that could be used to cover the renovation costs,” the astronomer says, stressing that public money is the only solution. As far as TIT is aware, the Hungarian state is willing to intervene and Parliament is expected to discuss the matter in the fall session. But some ownership matters must be settled beforehand. First and foremost, the land on which the building rests is an “unshared mutual property” — just like the entire Népliget — of the state, the local government and the Budapest municipality. This means all the three legal entities would need to okay the renovations. Additionally, the building

itself is 85% owned by TIT and 15% by the Hungarian government. Negotiations are under way at this moment, Lőrincz says, and the most probable solution will be that the state takes over ownership of both the land and the building, and will then provide the money needed for the renovation and modernization works. But TIT is open to anything as long as the planetarium can once again start operating as a modern institution, just as it was back at its opening. If just the roof is repaired, Lőrincz estimates the costs at about HUF 25-30 million, and shows could soon be screened again using the existing technology. A full modernization, however, would take around two years, for which period the planetarium must be closed. But it would be worth the wait, the astrologer envisages. Modern planetarium technology boosted by smart devices and 4k high definition LED projectors would bring a truly elevated experience with the possibility of 3D imaging. Furthermore, thanks to having smart-device powered technology, after modernization it would be able to project images of new discoveries onto the dome just hours after NASA has made the details public on its website.

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Three-phase Plan

DISTANT SONGS Aeneas Humm - baritone (CH) Judit Polgár - piano (CH/H) 8th June, 7 p.m. LANDSCAPES Ferenc Snétberger – guitar (D/H) Markus Stockhausen – trumpet (D) 9th June, 7 p.m.

The full renovation and modernization of the attraction would require three phases and

cost

HOUSE MUSIC Domonkos Csabay, Marcell Szabó – piano 10th June, 7 p.m.

HUF 3 billion.

The first step is the renovation of the roof structure: With the exception of the dome in the middle, the whole roof needs to be changed. The second stage is the renovation of the other parts of the building, while the third and the largest phase would be the technological upgrade of the space theat;

ANIMA MUSICAE CHAMBER ORCHESTRA TURNS SEVEN 20th June, 7 p.m. REMEMBERING ANNIE FISCHER Budapest Wind Quintet Péter Kiss – piano 5th July, 7 p.m.

GEORG BASELITZ: FIRSTLY, YOU ARE WELCOME, 2014 © ALBERTINA, VIENNA – BATLINER COLLECTION PHOTO: JOCHEN LITTKEMANN, BERLIN

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