HUNGARY Law and Practice Contributed by: Szabolcs Mestyán, John Fenemore, Balázs Rokob and Nóra Kertai, Lakatos, Köves & Partners
The non-payment of Eurocontrol charges may delay or prevent taking-off since, if so requested by Eurocon - trol, take-off shall be denied by the Hungarian air navi - gation service provider (Hungarocontrol). Although no express detention right is stipulated by domestic law, in practice, Hungarocontrol (on a contractual basis, on the basis of its terms of business/operation or on the basis of applicable international law) may require the owner to pay outstanding charges before allowing the aircraft to take off. Under Hungarian law, it is feasible to create a mort - gage over more than one aircraft. 3.3.2 Timeframe to Discharge a Lien or Mortgage The CAA has 55 days from the date of submission to deregister the mortgage from the Hungarian Aircraft Register. It is possible to request a priority process in which case the applicable deadline is 10 days. The deregistration of the mortgage over the engines of an aircraft from the security interest register is within the competence of a Hungarian public notary, and the process takes one to two business days. 3.3.3 Register of Mortgages and Charges The mortgage over an aircraft and engines is required to be registered with the Hungarian Aircraft Register and the Security Interest Register. Such registration is a perfection requirement under Hungarian law. Follow - ing the registration, the interests of the mortgagee will be noted on the certificate of registration of the aircraft and recorded among the security interests encumber - ing the assets of the security provider in the Security Interest Register. 3.3.4 Statutory Rights of Detention or Non- Consensual Preferential Liens The Hungarian government, other designated authori - ties or other governmental bodies may, in the case of extreme circumstances, effect (temporary) requisi - tion through ordering a special regime. Such circum - stances include: • a state of emergency;
Under the special regime, the exercise of fundamental rights may be suspended or restricted and therefore, among others, the expropriation or nationalisation of the aircraft, or the application of any other measure with the same effect, becomes available to the Hun - garian government. Compensation has to be paid, however, to the affected person or entity (with some exceptions). According to the Hungarian Criminal Code, an aircraft may be forfeited if used in connection with any crimi - nal activity. However, if the owner was not aware of the relevant offence (unless the forfeiture is prescribed by an international treaty), no forfeiture can be exercised. 3.3.5 Verification of an Aircraft’s Freedom From Encumbrances Security interests over the aircraft are indicated on the certificate of registration and in the Security Interest Register. A potential purchaser of the aircraft could obtain the certificate of registration directly from the Hungarian CAA and carry out an online search of the Security Interest Register to verify that the aircraft is free of encumbrances. 3.4 Enforcement 3.4.1 Differences Between Enforcing Security Assignments, Loans and Guarantees A security assignment over rights and claims is typi - cally enforced by the secured party collecting any claims and in the case of other rights by realising them by private sale or auction. A loan or guarantee constituting claims may be enforced by filing a lawsuit against the debtor and seeking court title for payment or performance. 3.4.2 Security Trustees’ Enforcement of Their Rights Under Hungarian law, a notice and acknowledgement of a security assignment is not necessary to establish a valid security assignment. However, the lessee may continue to discharge its obligations under the lease by payment to the lessor, unless notice of assignment or other appropriate proof of assignment is given to the lessee by the relevant assignor.
• a state of war; and • a state of danger.
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