The Hungarian Parliament recently adopted amendments to the notarial procedure, introducing significant changes that affect the reading of documents during notarial acts from 1 January 2025.
The new legislation allows parties involved in the creation of a notarial document to jointly decide to waive the reading of the document by the notary. This will apply regardless of whether the parties are natural or legal persons and whether they are represented by legal representatives.
The new amendment is welcome. The reading obligation is considered outdated and disadvantageous for the parties, since it prolonged the duration of the notarial procedure, i.e. the time that the parties spent at the notary's office. Furthermore, the mandatory reading emptied the institution of transactional representation and made notarisation more expensive.
The change is particularly important for branches of foreign entities. Currently, the notary must read out the notarial deed in full if one of the parties is a natural person or an entity without legal personality, such as a branch, even if acting through legal representatives. The reading can only be waived for legal persons, provided they act through legal representatives.
Under the new amendment, the parties to the document will be entitled to jointly request the notary to waive the reading of the notarial deed. The parties or their representatives must declare in a separate document to be attached to the notarial deed that they have read and understood the draft of the notarial deed. This declaration may be made in the form of a notarial deed or a private deed authenticated by a notary, a court, another authority or a Hungarian consular officer. Notaries can still decide at their discretion to read out the notarial deed, even if the parties request otherwise. If the reading is waived, the notary must inform the parties or their representatives of the conditions of direct enforceability of the notarial deed.
Crucially, the new amendment only abolishes the reading obligation but not the notary's other obligations associated with preparing a notarial deed, such as providing impartial legal service and information to the parties about the essence and legal consequences of the legal transaction.
The legislator reserved the notary's obligation to read out the notarial deed in some cases, based on the subject matter of the case or the reason inherent in the persons of the parties or their representatives. Therefore, the reading cannot be waived in the following cases:
- when the notarial deed contains a will or another testamentary disposition;
- when the legal statement can only be made personally;
- when the party or the representative is illiterate, unable to read or sign their name, does not understand the language of the notarial deed or is blind.
The amendment aims to reduce formalities where the parties are sufficiently informed and have acknowledged their understanding of the document. However, it also safeguards the interests of parties who may be vulnerable due to language barriers, disabilities or illiteracy, ensuring that the notary's reading of the document serves as a protective measure in such cases.
All in all, the recent amendment should be seen as an important and positive step, one that reflects the level of understanding of the transactions by market participants. It should make document notarisation less painful for the parties.
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