Hungary has revised its anti-money laundering regime, introducing stricter obligations that took effect in 2025. International companies with Hungarian operations face tighter deadlines for updating their compliance programmes. Failure to act before the applicable grace periods expire can trigger supervisory sanctions, account restrictions, and reputational damage that is difficult to reverse.
Hungary's updated AML legislation strengthens know-your-customer (KYC) requirements, expands the categories of obliged entities, and tightens beneficial owner identification rules. Companies must review existing customer due diligence files and update their internal policies to reflect the new thresholds and reporting obligations. Supervisory authorities have signalled active enforcement from the first half of 2026 onward.
This alert summarises what changed, which business categories are now in scope, and the five immediate actions every affected company should take.
What changed and when it takes effect
Hungary's money laundering and counter-terrorism financing legislation – which aligns with the EU's successive AML directives – was amended to incorporate strengthened customer due diligence standards. The core provisions entered into force in 2025. Transitional arrangements for existing client portfolios run through the first quarter of 2026 for most obliged entities.
The principal changes fall into three areas. First, the threshold at which enhanced due diligence applies to occasional transactions has been lowered. Second, the definition of beneficial owner has been broadened. Any natural person holding or controlling – directly or indirectly – a significant ownership interest in a legal entity must now be identified and verified. This applies even where ownership is held through multiple layers of corporate structure. Third, ongoing monitoring obligations have been intensified. Obliged entities must be able to demonstrate, at any supervisory inspection, that client files are current and that transactions are being screened against updated risk profiles.
For companies engaged in correspondent banking arrangements, the revised rules impose additional pre-approval steps before establishing or continuing a relationship with a respondent institution. Correspondent banking relationships involving jurisdictions listed on the EU's high-risk third-country register require documented senior management approval and enhanced periodic review.
Hungary's financial supervisory authority, the Magyar Nemzeti Bank (Hungarian National Bank, which also functions as the prudential and AML supervisor for financial entities), has published revised supervisory expectations. Non-financial obliged entities are supervised by sector-specific authorities, and those bodies have issued parallel guidance consistent with the legislative changes.
Who is affected and threshold criteria
The updated regime applies to a broad range of obliged entities. The following categories are directly in scope:
- Credit institutions and payment service providers operating in Hungary
- Investment firms, asset managers, and capital markets intermediaries
- Accountants, auditors, and tax advisers providing services to legal entities
- Real estate agents and property transaction intermediaries
- Notaries and legal professionals handling client funds or company formation
International companies are affected if they maintain a registered branch or subsidiary in Hungary, hold a Hungarian bank account, operate through a Hungarian intermediary, or provide any of the listed services to Hungarian-resident clients. The nationality of the parent entity does not create an exemption.
For bank account opening and credit facility applications, Hungarian financial institutions are now required to collect and verify beneficial owner information before any account or facility is activated. This means that a foreign parent company seeking to open an account for its Hungarian subsidiary must provide a current. Documented ownership chain tracing back to every natural person who qualifies as a beneficial owner under the amended definition. Documents must typically be translated into Hungarian or English and, where originating abroad, apostilled or otherwise authenticated.
Threshold criteria trigger enhanced due diligence in the following situations: transactions or account activity above defined monetary thresholds. clients established in high-risk third countries. politically exposed persons (PEPs) or their close associates. and any transaction with no clear commercial rationale visible from the client's stated business profile.
For a broader view of Hungarian banking and finance regulatory obligations, see our service page covering banking and finance matters in Hungary.
To receive an expert assessment of your AML compliance exposure in Hungary, contact us at info@ferrazwhitmore.com.
Immediate actions for international companies
Companies with Hungarian operations should treat the following steps as urgent priorities ahead of the supervisory enforcement window opening in mid-2026.
1. Audit existing KYC files. Review all customer and counterparty files held by your Hungarian entity. Identify records that predate the 2025 changes and are therefore based on the prior, less demanding standard. Prioritise files for clients who are legal entities – these are most likely to require fresh beneficial owner verification under the expanded definition.
2. Update beneficial owner registers. Hungary maintains a central register of beneficial owners. Verify that the information filed for your Hungarian entity accurately reflects current ownership. Where the ultimate ownership chain has changed – through restructuring, share transfers, or new investment – update the register promptly. Discrepancies between the register and the company's internal records are a primary focus of supervisory inspections.
3. Revise internal AML policies. Your Hungarian entity's AML policy document must reflect the updated thresholds, the revised beneficial owner definition, and the new enhanced due diligence triggers. If your group operates a single global AML policy, a Hungary-specific addendum or schedule may be the most efficient solution.
4. Train compliance personnel. Staff responsible for onboarding clients, approving transactions, or managing correspondent banking relationships must be familiar with the 2025 changes. Documented training records are required and will be requested during supervisory reviews.
5. Review correspondent and capital markets relationships. If your Hungarian entity maintains correspondent banking arrangements or provides services regulated under capital markets legislation, assess each relationship against the revised risk criteria. Relationships involving high-risk jurisdictions require documented senior-level approval. For entities active in securities intermediation, the intersection of AML obligations with capital markets conduct rules is addressed in our overview of capital markets services in Hungary. Companies operating across multiple EU jurisdictions may also find it useful to compare Hungary's approach with recent AML developments elsewhere – our alert on AML updates in Portugal provides a useful comparative reference.
About Ferraz & Whitmore
Ferraz & Whitmore is an international law firm based in Lisbon, advising business clients across 46 jurisdictions. Our banking and finance practice supports international companies managing AML and regulatory compliance obligations in Hungary and across the EU. We combine Portuguese civil law expertise with English common law tradition to deliver practical, cross-border compliance solutions for financial institutions, multinationals, and in-house legal teams. As a law firm working with international clients who need a lawyer in Hungary with cross-border regulatory experience, we help map exposure, update compliance programmes, and engage with supervisory authorities. Our attorneys have advised on AML, KYC, and correspondent banking matters across both civil law and common law systems. To discuss your compliance position in Hungary, contact us at info@ferrazwhitmore.com.
Disclaimer: This publication is provided for informational purposes only and does not constitute legal advice. The information herein should not be relied upon as a substitute for professional legal counsel tailored to your specific circumstances. Ferraz & Whitmore assumes no liability for actions taken or not taken based on the contents of this material. For advice regarding your particular situation, please contact info@ferrazwhitmore.com.