This article was originally published on ECNL website – 23 January 2020, accessible here.

Civil society’s right to privacy has been under attack 
CSOs’ right to privacy has been facing increasing attacks over the past years. We have witnessed new rules proposed and/or enacted in the name of transparency, protection of national security, countering money laundering and terrorism financing. These rules affect how and what kind of information CSOs have to report and disclose to the public or the authorities, and often put disproportionate burden on the organizations. For example, the 2017 Hungarian Law on the transparency of organizations supported from abroad requires CSOs to comply with additional burdensome requirements on their foreign resources. As part of this, they have to report on each transaction they have had with donors, who have contributed at least 500,000 HUF (approx. €1,500) per tax year, and provide the donors’ names, location, etc. Failure to comply can result in high fines and possibly termination. The Hungarian Law was first of its kind in a European Union country, following the patterns of laws in Russia, Israel, India, among others. Since then the Dutch Ministry for Legal Protection has also published a draft Act on Transparency of Civil Society Organizations for public consultation. The 2018 December draft Act would require all CSOs operating in the Netherlands to publish so-called ‘donor overviews’ either directly on their website or via the Commercial Register. These overviews would include, among others, private information (i.e. the names and places of residence) of all donors whose donations reached or exceeded 15,000 EUR per year. The failure to do so would be sanctioned under the Economic Offences Act. In Romania there was also a proposal that would have imposed burdensome and disproportionate reporting requirements for CSOs.

What happened last week?
On January 14 there was an important development related to the Hungarian Law, which is currently before the Court of Justice of the European Union after the Commission brought an action for failure to fulfill obligations against Hungary. The Advocate General, Campos Sánchez-Bordona released an Opinion in the case, according to which the restrictions imposed by Hungary in the Law are not compatible with EU law.

Why is the Opinion important?
The Advocate General is of the opinion that the Hungarian Law violates the protection of private life and personal data. The publication of the names of the donors and the amounts of such donations is an interference in the private life of those persons as regards the processing of their personal data. The disclosure of the donor’s name reveals an affinity between the donor and the organization and may help to ideologically profile the donor. This may deter donors or dissuade them from helping to support CSOs.

The financial effects of the Law may also affect the viability and the survival of the organizations concerned, undermining the attainment of their social objectives. By making the financial contribution of potential donors more difficult the legislation directly affects those persons’ exercise of the freedom of association.

The Hungarian Law also restricts the free movement of capital, both with regard to the organizations affected and their foreign donors. The conditions of the Law apply solely in the case of donations coming from abroad hence they are much more likely to affect nationals of other Member States than Hungarian nationals.

Last but not least the Advocate General questions the legitimacy of the Law. According to the Opinion the protection of public policy and the fight against money laundering and terrorist financing does not legitimize general legislation which imposes, ex ante, such obligations on all CSOs. Moreover, the Advocate General considers that the EU legislation on the fight against money laundering and against terrorist financing is sufficient for the purposes of guaranteeing adequate protection.

While the Court of Justice is not bound by the Advocate General’s opinions, it plays an important role in the final decision and are referred to in later cases. According to empirical research the Court of Justice is 67 % more likely to annul an EU act if doing so was advised by an Advocate General. The process and arguments used in the case against Hungary provides grounds to counter similar laws and policies that introduce additional reporting and disclosure requirements for CSOs.

What does ECNL do?
ECNL, together with the European Foundation Centre and Open Society Justice Initiative, has been working on a Handbook on how to use EU Law to defend civic space. The Handbook aims to be a user-friendly guide for CSOs who want to know when and how they can use EU law arguments to assess national laws that may negatively impact their mission, activities and operations. Among others, it covers EU law arguments dealing with the four basic freedoms of the Internal Market and the rights and freedoms of the Charter of Fundamental Rights of the EU, including the right to privacy, data protection, freedom of association and freedom of expression. The Handbook was informally consulted with the EU Fundamental Rights Agency (FRA) and other key experts during the drafting process. The Handbook is expected to be published in early 2020 so stay tuned!


For more background:

  • Advocate General’s Opinion in English here and in Hungarian here
  • Joint statement of Amnesty International Hungary, Hungarian Civil Liberties Union and Hungarian Helsinki Committee here
  • CoE Expert Council Opinion on Romania’s Draft Law on Associations and Foundations here
  • Background from ECNL on the Hungarian Law on the transparency of organizations supported from abroad here
  • ECNL comments to the draft Act on Transparency of Civil Society Organizations of the Netherlands here

 

[Read also the article bu Hungarian Helsinki Committee on the Hungarian Law and CJEU Advocate General’s Opinion HERE]

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