April 2019 – The Hungarian Parliament
passed the Act on Foundation Trusts on 5 March 2019. This legal
concept has had a long and successful history in German-speaking
countries. The main purpose of lawmakers in introducing this
concept is to provide a legal framework – in addition to the
already operating trusts – to manage, preserve and enlarge
private equities owned by families for future generations. Please
find below a brief overview of the most noteworthy regulatory
features. The Act entered into force on 29 March 2019.
The purpose of a foundation trust
The main purpose of a foundation trust is to manage assets that
were given by the founder to the foundation trust in order to
achieve the objectives set out in the deed of foundation. This
objective could be – in accordance with applicable laws
– any private objective. As a practical example, the founder
– in order to prevent a division of the estate – makes
a devise to the foundation trust, which manages the
