HUNGARY Law and Practice Contributed by: Tamás Éless, Sarolta Édua Szabó, Ulrike Rein and Zsolt Farkas, Oppenheim Law Firm
ian Arbitration Act shall apply. Section 14 of the Act stipulates that the party that wishes to challenge an arbitrator shall send a reasoned statement regarding the challenge to the arbitral tribunal within 15 days of becoming aware of the composition of the arbitral tribunal, or within 15 days of becoming aware of the underlying reasons for the challenge. If the challenged arbitrator does not voluntarily with - draw from office, or if the other party does not agree to the challenge, it is up to the arbitral tribunal to decide on the motion for challenge. If the challenge was unsuccessful using the proce - dures described above, the challenge shall be decid - ed by the Budapest Metropolitan Court upon request of the challenging party submitted within 30 days of the receipt of the decision on the rejection of the chal - lenge, or by the Board of the Commercial Arbitration Court if the dispute is administered by the Commer - cial Arbitration Court. If the Board of the Commercial Arbitration Court rejects the challenge, the challenging party may, within 30 days, request the Budapest Met - ropolitan Court to decide on the challenge. The decision of the Budapest Metropolitan Court on the challenge is final and binding, and cannot be appealed. Until the order is served, the arbitral tribu - nal – including the arbitrator to whom the motion for challenge relates – may continue the proceedings and render its award. According to the case law of the Hungarian Supreme Court, the failure of an arbitrator to disclose a circum - stance that may give rise to doubts regarding his or her impartiality is automatically considered a ground for setting aside the arbitral award (Gfv.30.141/2010/24). 4.5 Arbitrator Requirements Under Section 13 (1) of the Hungarian Arbitration Act and Section 23 (1) of the Rules of Procedure of the Commercial Arbitration Court, an appointed arbitrator must disclose any circumstances that are likely to give rise to doubt regarding his or her impartiality or inde - pendence, prior to accepting an appointment. The arbitrator shall comply with this obligation throughout the whole proceeding – ie, from his or her appointment
up to the closing of the arbitration proceeding and the rendering of the arbitral award. Under the Hungarian Arbitration Act, the members of the Board of the Commercial Arbitration Court may only appear in arbitral proceedings as party-appointed arbitrators; they cannot be nominated by the Board of the Commercial Arbitration Court.
5. Jurisdiction 5.1 Challenges to Jurisdiction
Hungarian law recognises the principle of compe - tence-competence, which means that the arbitral tribunal may rule on its own jurisdiction, including a challenge to the existence or validity of the arbitration agreement (Section 17 (1) of the Hungarian Arbitration Act). 5.2 Circumstances for Court Intervention In accordance with Section 17 of the Hungarian Arbi - tration Act, the arbitral tribunal may rule on an objec - tion to its jurisdiction either as a preliminary issue or in its final award. In the former case, any party may – within 30 days after receiving notice of such a rul - ing – request the Budapest Metropolitan Court to rule on the jurisdiction of the arbitral tribunal. The arbitral tribunal may continue its proceeding and render an award until it is served with the ruling of the Budapest Metropolitan Court on the jurisdiction of the tribunal. 5.3 Timing of Challenge An objection to the jurisdiction of the arbitral tribunal shall be raised no later than the time the statement of defence is submitted. The fact that a party has nomi - nated or participated in the nomination of an arbitrator shall not preclude the party from raising an objection to the jurisdiction. An objection alleging that the arbi - tral tribunal has exceeded its competence shall be raised immediately in the event of an alleged excess of competence; however, the arbitration panel may accept an objection at a later stage if it considers the delay in the objection to be justified. As noted in 5.2 Circumstances for Court Intervention , parties have the right to go to court to challenge the jurisdiction of the arbitral tribunal if the arbitral tribunal
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