The Hungarian business environment is recommended for those who want to open an IT company in Hungary, as this market is one of the most representative in Central Europe. Foreign investors should also know that Hungary is a member state of the European Union (EU) and, as such, the legislation applicable to companies here follows EU’s directives.
An IT company in Hungary is incorporated following specific steps, which are compulsory for all types of businesses registered here. However, it is important to know that this type of business may need to obtain special permits and licenses issued for the IT field; our team of Hungarian company incorporation representatives can provide assistance on this matter.
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The main steps for opening a company in Hungary
It is crucial to choose a legal entity which will best represent the interests of the investors. There are several legal entities which are available for foreign investors and it is important to know that the local legislation prescribes only few restrictions to foreigners performing business activities on the Hungarian market. Investors can choose from the following:
- private limited liability company;
- general partnership;
- limited partnership;
- joint stock company.
After the investor decides what legal entity is better suited for his or her activities, it is necessary to draft the statutory documents of the future company.
After this procedure is completed, the next step is to open a corporate bank account, in which the minimum share capital will be deposited, in accordance with the provisions stipulated in the statutory documents. Our team of Hungarian company formation consultants can provide more details on the provisions of the documents.
Please mind that based on the legal entity that you will select for your Hungarian business, the accounting procedures may vary. This can happen because the law regulates different accounting obligations in accordance with the company type, the size of the company or its annual income.
Our accountants in Hungary can explain what the main rules in this sense are and what will the obligations of your company will be, once you will start the business activity.
Legislative update concerning IT operators in Hungary
Businessmen who will open a Hungarian company need to abide by various rules of law, regulating the incorporation and functioning of a legal entity, its taxation and reporting, etc. Besides these, investors must be aware of industry specific regulations. Amongst many sectoral laws, IT businesses are required to implement the rules of the Cybersecurity Act, entered into force starting with 1st of January 2025.
The new law replaces 2 previous Acts and transposes the EU laws into the national law. Under the new rule, it is established that a foreign entity which operates an electronic information system, and which is not registered in Hungary, is required to appoint a local representative. The latter has the obligation to implement the rules of the Cybersecurity Act.
We mention that the new law applies to both private and public entities and that it regulates matters such as:
- the basic rules for cybersecurity;
- the regulations for certification in the industry;
- the procedures for cybersecurity incidents;
- the categories of entities which make the object of the law.
Under the new law, these entities must categorize their electronic information systems under one of the following 3 categories:
- basic;
- significant;
- high.
These 3 refer to the risks associated with the respective systems, as well as to the confidentiality and integrity measures they provide for the data processed. These systems have to be evaluated on a regular basis (every 2 years). Our specialists in company registration in Hungary can further advise on other obligations that are imposed under the new law.
What types of IT activities/systems are criminalized in Hungary?
With the development of the IT sector, various third parties have used different IT systems to steal digital data from companies, local authorities and individuals. At the moment, there are a variety of methods used in this sense by hackers. In Hungary, the legislation criminalizes these types of operations under the Hungarian Criminal Code, some of which are:
- hacking (regulated by the Section 423 of the Hungarian Criminal Code, resulting in at least 2 years of imprisonment);
- phishing (this operation constitutes computer fraud as per the Section 375 of the same Code);
- all types of malware, such as viruses, ransomware, trojans, can be punished with up to 8 years in prison according to the Sections 423 and 424 of the Act);
- possession of software and/or hardware used for cybercrime purposes can result in 2 years of imprisonment (Section 424);
- identity theft and/or identity fraud are criminalized in accordance with the provisions of the Sections 219 and 375 of the Criminal Code, and can result in imprisonment of 5 to 10 years.
There are other cyber-offences that are regulated under the Hungarian law, and our consultants can provide more information. Thus, it must be noted that individuals as well as those who want to open an IT company in Hungary can benefit from legal protection provided that they are the victims of activities such as the ones presented above.
Can IT companies export their IT technology?
Yes, companies that want to export their IT technologies, whether they refer to software or hardware, have the right to export such products, but not without prior approval, in the case in which the export is made in a country outside the European Union (EU). This is done as per the Regulation (EU) 2021/821, which is applied in Hungary.
Our consultants can provide more details on this rule of law and can offer full legal representation if you want to open a Hungarian company in the IT sector.
Competent authorities
The process of company formation in Hungary in the IT industry may fall under the supervision of any of the following (the institution can vary based on the rules of law applicable to a specific IT branch):
- the National Security Service;
- the Hungarian National Bank;
- the Authority for Regulated Activities.
Litigation concerning IT businesses in Hungary
Those who open an IT company in Hungary can enter litigation cases in accordance with the stipulations of the Hungarian Civil Code. These provisions refer to the fact that the IT operator/services provider did not meet its contractual obligations (breached the contract) or did not provide the necessary security or service levels.
An IT company can be exempt from liability in litigation cases provided that it is demonstrated that the event was created by certain circumstances that could not be controlled by the service provider. Litigation can also arise from criminal-related cases. In all situations, you can rely on our team of consultants in company registration in Hungary.
The IT industry in Hungary
When investing in Hungary, investors should know that the local economy is a part of the EU’s Digital Single Market, a project which aims at the development of the local economy through the use of digital services and products.
The local market is focused on IT services and products, as more than 95% of the Hungarian households benefit from fixed broadband services. Businessmen who want to open a company in Hungary in the IT industry are invited to discover the following data on the Hungarian IT sector:
- the Hungarian IT market is estimated at $2.14 billion in revenues in 2025;
- the most important segment is IT outsourcing, which accounts for approximately $797.47 million in 2025;
- by 2029, it is estimated that this market will expand to $2.81 billion;
- this sector is comprised of 4 main branches, namely IT outsourcing, IT consulting, business process outsourcing and other IT services.
Investors interested in receiving more details on the processes involved when opening an IT company in Hungary can address to our team of Hungarian company incorporation agents for assistance.