Options for registering companies in Hungary
Hungary is a parliamentary republic in Central Europe and a member of the European Union. Its corporate framework recognises domestic companies and registered establishments of foreign companies.
Companies are governed principally by Act V of 2013 on the Civil Code and registered by the competent company courts. Company information is recorded in the Hungarian company register and made available through the Ministry of Justice Company Information Service.
The available entity types vary in legal status, tax treatment, capital thresholds and governance structure, shaping how foreign businesses operate and manage risk locally.
Hungary offers international investors the following legal structures for establishing a local presence:
Limited liability company (Korlátolt felelősségű társaság, Kft.)
A Kft. is a Hungarian commercial company with separate legal personality and member liability generally limited to the agreed capital contributions.
- A Kft. is a separate legal person with assets and obligations distinct from those of its members. Unlike a branch, it provides a separate corporate liability structure for Hungarian operations.
- A Kft. is commonly used for commercial, manufacturing, technology, service and investment activities. It conducts business and enters contracts in its registered company name.
- The minimum registered capital of a Kft. is HUF 3,000,000 under section 3:161 of the Hungarian Civil Code.
- A Kft. is managed by one or more managing directors appointed by its members.
- Corporate income tax is 9% of the positive tax base. The company remains subject to annual corporate tax returns, accounting obligations and applicable local business taxation.
- The company register records the Kft.’s registered office, capital, activities and legal representatives. Corporate documents and annual financial statements are filed electronically.
- In contrast to a branch, a Kft. creates a separate Hungarian legal person and liability structure. It cannot offer its ownership interests through a public securities offering.
Public company limited by shares (Nyilvánosan működő részvénytársaság, Nyrt.)
An Nyrt. is a public joint-stock company with separate legal personality and share capital divided into publicly tradable shares.
- An Nyrt. is a separate legal person whose shareholders are generally liable only for their share contributions. Unlike a branch, it holds its own rights, assets and obligations.
- An Nyrt. is commonly used for large enterprises and companies accessing public capital markets. Its shares are structured for public trading under the applicable securities framework.
- The minimum registered capital of an Nyrt. is HUF 20,000,000.
- An Nyrt. operates through the corporate bodies required under the Hungarian Civil Code.
- Corporate income tax is 9% of the positive tax base. Public companies also remain subject to accounting, audit, disclosure and annual corporate tax filing obligations.
- The company register records the Nyrt.’s issued capital, registered office, activities and legal representatives. Public securities activities are subject to financial-market regulation.
- Unlike a Kft., an Nyrt. supports public share ownership and access to public capital markets. Securities cannot be publicly offered without meeting the applicable regulatory requirements.
Branch office (Fióktelep)
A branch office is a registered Hungarian establishment of a foreign company and does not create a legal person separate from the foreign enterprise.
- A branch office is not a separate legal entity from the foreign company that established it. Unlike a Kft., its local rights and obligations remain connected to the overseas company.
- A branch office is commonly used by foreign companies for direct commercial operations in Hungary. It conducts registered activities as an establishment of the foreign enterprise.
- No separate company share capital applies to a branch because it is not incorporated as an independent Hungarian company.
- The branch operates through its registered legal representative and the foreign company’s governance structure.
- Income attributable to the Hungarian branch is subject to the 9% corporate income tax rate. Applicable accounting, annual tax reporting and local business tax obligations remain in force.
- The Hungarian company register records branches, registered offices, activities and legal representatives. Registration does not separate the branch’s ownership from the foreign company.
- In contrast to a Kft., a branch does not establish an independent liability shield in Hungary. The foreign company remains responsible for obligations arising from branch operations.
Representative office (Kereskedelmi képviselet)
A representative office is a registered non-trading presence of a foreign company used for representation, liaison and activities supporting the foreign enterprise.
- A representative office is not a separate legal entity and operates on behalf of the foreign company. In contrast to a Kft., it has no independent commercial personality.
- A representative office is commonly used for liaison, contract preparation, advertising and market-support functions. It is not an independent revenue-generating company.
- No separate company share capital applies because a representative office is not incorporated as a Hungarian company.
- The representative office acts through the person recorded as its local representative.
- A representative office cannot conduct independent commercial trading.
- The registered presence remains subject to applicable company-register, accounting, employment and tax-administration obligations. Its records remain connected to the foreign enterprise.
- Unlike a branch, a representative office cannot conduct independent revenue-generating operations. Commercial trading requires a branch or a separately incorporated Hungarian company.
Comparison of the common types of companies in Hungary
Information verified against Ministry of Justice and National Tax and Customs Administration.
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