Are you thinking of doing business in Hungary? Are You? When you do not have the right local help, it can be somewhat difficult to start and do business operations. The ideal location of Hungary has led to its becoming the center of manufacturing, services, and logistics. This country has a good balance between labor costs and quality, which makes it ideal for establishing a presence in the huge European market for businesses looking to establish a presence. It has an excellent infrastructure, preassembled industrial sites, and science parks.
The government offers incentives to encourage foreign companies to expand in Hungary (such as cash subsidies and tax breaks). This has contributed to the country’s economic growth by creating a favorable investment policy. In addition to a modernized economy and a competitive tax system, international companies seeking growth have also attracted the country.
However, despite the attractiveness of the Hungarian commercial environment, there are a few areas in which commercial operations can be challenging to overcome for foreign companies. The World Bank and the International Finance Corporation (IFC) place Hungary out of the 100 best countries in the world in terms of ease of obtaining electricity, protecting investors, and paying taxes, which is why it is essential to have local help to overcome these complicated areas.
10 Unique Challenges Of Doing Business In Hungary | Sort Things Before You Move!
Start A Company
Companies must have a lawyer to represent them when creating a corporate entity in Hungary. The lawyer will represent the company, create the deeds, and prepare all other legal documents to complete the Company Formation Hungary process. In any event, half of the membership sum (at any rate HUF 250,000) must be stored in the ledger demonstrated at the hour of membership. Applications should likewise be submitted to the Registration court before standardized savings can be built up.
Take Care Of Building Permits
Building permits require 26 procedures, which take 102 days to process. In addition to a declaration from the Municipal Planning Committee and a letter from the Fiscal Authority, many intergovernmental departments have to inspect companies before receiving a statement. Upon meeting the occupancy criteria, the building registration must be completed at the Land Registry Office and an Occupancy Permit issued.
The World Bank and the IFC rank Hungary among the 50 worst countries in terms of the ease of obtaining an electrical connection, which requires 252 days in total. Once the contract for the use of the electricity grid has been signed, they will install the meter and make the final connection.
Since it takes just over two weeks to register the property, the registration is, without a doubt, the most agile step of organizing the company’s residence. For legal assistance, please consult an attorney.
The Credit Process
Hungary does not have very high indicators outside of the legal rights index in terms of obtaining credit. Private agencies cover fewer than 20% of adults, and there is no public registry.
The World Bank and IFC place Hungary in the 128th place in the world in terms of investor protection, in large part due to low ratings and disclosure rates.
Completing the payment of taxes may require, on average, 277 hours of the company. The local tax on economic activities, the contribution to rehabilitation, the contribution for training, and research and development taxes are levies that most companies do not know.
Marketing In Other Countries
Taking business trips outside of the U.S. is relatively inexpensive, despite the lengthy procedures. It takes about 17 days to export merchandise and about 19 days to import it. In consequence, trade both within and outside the country decreases.
Resolving Insolvencies & Contract Compliance
Contract compliance can be completed in just over a year by completing 35 procedures. An insolvency case can take two years to be decided by a court, and the recovery rate is well below the OECD standard.
Doing business in Hungary requires a local representative on the ground. The representative will assist you in approaching the company, scheduling appointments, providing language assistance, and acting as an intercultural resource.
You can pass these mined fields with FirmaX Hungary’s local knowledge. You can register a company in Hungary for the best price on the market, no matter your plans, whether you want to move to Hungary or want to optimize your Hungarian operations.