New regulations on illegal gambling activities in Hungary take effect

The Supervisory Authority for Regulated Activities of Hungary (SZTFH) informed that as of July 1, 2023, the provisions of the law on organizing gambling without a permit, concerning unauthorized gambling activities, will be applicable to transactions involving gambling.

Hungary fights unauthorized gambling sites

According to the legal regulations, Hungarian payment service providers are obligated to prevent the execution of financial transactions related to unauthorized foreign online gambling websites as of July 1, 2023.

Domestic payment service providers may only enter into and maintain framework agreements for payment account management and card acceptance agreements for payment transactions initiated using cash substitute payment instruments with gambling organizers approved by SZTFH and listed in the publicly available authoritative register published on the SZTFH website.

In Hungary, SZTFH has had the power to block websites and impose administrative fines on illegal gambling organizers. However, after July 1, 2023, the Authority’s toolbox for measures against illegal gambling organizers will expand.

In connection with website blocking, payment service providers are required by law to prevent the realization of transactions involving unauthorized online gambling through bank cards, targeting transactions abroad.

In exceptional cases, when the Authority prohibits the transfer related to unauthorized gambling without a permit as a payment transaction, it orders the financial blockage of the account used for deposit or withdrawal. Payment service providers execute the financial blockage based on the Authority’s decision.

The Authority is also entitled to impose administrative fines, including repeated fines, on payment service providers who fail to execute the financial blockage and communicate its decision to the Magyar Nemzeti Bank acting within its supervisory authority.

Registry of prohibited payment accounts

The Authority maintains a register of prohibited payment accounts subject to restrictions. The register, named “Registry of Prohibited Payment Accounts,” publishes the data required by law on the Authority’s website, accessible to everyone.

The published register includes the number of the prohibited payment account, and if identifiable, the organizer’s name, address, registered office, tax identification number, or contact information indicated on the gambling website used for communication. It also includes the brand name used for gambling and the date of publication in the format of year, month, and day.

After July 1, 2023, payment service providers continuously monitor this register and are obliged to execute financial blockage accordingly.