Freedom of Information

Hungarian Football Federation resists highest court ruling and demands payment for disclosing data about allocating taxpayer funds

Last year Transparency International Hungary (TI) won a lawsuit it brought against the sports associations in the Curia of Hungary to get access to data about corporate taxes allocated for them, that is, the so-called TAO money that they are receiving. Notwithstanding the ruling, the Hungarian Football Federation (MLSZ) refused to hand over the documents free of charge, demanding HUF 400,000 (approximately 1250 euros) from TI. MLSZ also wants Transparency International to sign a non-disclosure agreement, that is, the data that TI pays for could not be published.

The Orban government introduced a new system in 2011 allowing companies to transfer a fraction of their corporate tax (TAO in Hungarian) to government-approved sports associations (soccer, hockey, handball, basketball, water polo) or cultural associations. That is, companies do not pay that part of their corporate tax to the state but to the sports or cultural organization.

Since this system was introduced, the majority of the sports-TAO went to various soccer teams through the Hungarian Football Federation, with the largest beneficiary being the Puskas Football Club of Felcsut (led by Orban’s childhood friend and Hungary’s richest man, Lőrinc Mészáros).

The donors of the TAO contributions and the exact amount that went to each team was not made public for years, nor how these funds had been spent. The government argued that these contributions did not constitute public funds being donated by companies.

Last year, the Curia, the highest court of Hungary, ruled that TAO contributions were, in fact, public funds as they are essentially lost funds for the state budget. Consequently, any data regarding them are to be made available to the public.

In July 2016 Transparency International Hungary filed a freedom of information request with the sports associations to find out about the amount of financial support transferred by companies to each of these sports associations and how these funds had been spent.

The sports associations declined to disclose data citing tax secrets and protection of personal data, prompting TI to file a lawsuit against them. The court at first instance supported the argument of the sports associations, but TI appealed and won.

As a consequence, the court ruled that the football, ice hockey, handball, basketball and water polo associations must hand over the support certificates – that is, the documents proving how much TAO money they received.

The final court ruling filed a request for review to the Curia, which ruled in May 2018.

The binding, unappealable ruling by the Curia approved the second ruling and reaffirmed the judgment of the appeals court and ordered the sports associations to hand over the relevant documents to TI.

However, the Hungarian Football Federation, which channeled most of the TAO funds to individual football clubs, refuses to hand over the requested data to TI.

In early December 2018, the Football Federation informed TI that there would be material and labor costs incurred by copying the 40,000 pages of documents as per the Curia’s ruling. Consequently, MLSZ demands HUF 10 per page from TI, a total of HUF 400,000.

In addition, MLSZ also insists on TI signing a non-disclosure agreement, allegedly in the protection of the personal and confidential data in the documents.

TI inquired about the types of personal data and requested MLSZ to waive the HUF 400,000 payment on the grounds that TI cannot afford to pay that amount and MLSZ is legally obliged by the court’s ruling.

Miklos Ligeti, director of the legal department of TI, called MLSZ’s fee cynical and argues that ‘it adds a further obstacle to having transparency in the state subsidies of some mass sports.’

Ligeti also pointed out in his letter to the Federation that the financial compensation requested is also unfair in light of the fact that the football industry received HUF 230 billion, which should not necessitate charging for the documents. In turn, MLSZ replied that it still insists on the compensation and the non-disclosure agreement.

As a reminder: Atlatszo was asked to pay HUF 2.5 million for the TAO documents last year, but MLSZ eventually handed over the documents free of charge regarding the TAO finances of the requested football clubs (with close ties to strongmen of the state), such as Felcsút, Fradi, Kisvárda, Mezőkövesd, Videoton, for the period of 2015-2017.

Written by Katalin Erdélyi

English version by Péter László

You can read the original, Hungarian language version of this story here.

Cover image: one of the documents proving that Lőrinc Mészáros’s football club in Felcsút received TAO funds, that is, taxpayer money.