The Regulation of Public Institution Insolvency in Hungary

In the Hungarian legal system-after 50 years-, formerly known legal institutions (such as self-governments, private companies, public institutions) reappeared. These legal institutions are independent of the state, they have their own revenues and properties. Thus the possibility of their insolvency was brought up naturally. The Hungarian legal system does not provide an unambiguous definition of public institution. However, with an eye to foreign legal solutions and the Hungarian specialities, we can formulate the concept of public institution which includes organs that are actually separated from the state, that have autonomy, legal personality, independent budget, their own booking (accounting), and that perform tasks of public utility. These criteria are met by three types of organs: self-governments, public bodies, public funds. However, legal regulations concerning these types are not homogeneous. After 1990, when public institutions were established, the state drew back from several public functions and has striven to withdraw itself from the responsibility for inadequate financial administration ever since