Windfall reclaim opportunity in Hungary as the Court of Justice of the European Union finds additional mining fee contrary to EU law

Hungary introduced an additional mining royalty in 2021, initially for five construction materials (i.e. graded sand, graded gravel, graded sandy gravel, natural sandy gravel and cement). The scope of the additional mining royalty was extended in 2023 to ceramic masonry units, small solid bricks, ceramic lining bricks, ceramic facing bricks, ceramic roof tiles, ceramic wall tiles and ceramic floor tiles.

The additional mining royalty involves setting a reference price for in-scope products and requiring affected market players to pay an additional mining fee of 90% on the part of their selling price that exceeds the reference price.

In its judgment delivered in case C-144/24 Commission v Hungary, the Court of Justice of the European Union found that the additional mining royalty violates the freedom of establishment. Due to the primacy of EU law, this judgment requires Hungarian authorities and courts to disapply the rules on additional mining royalty, which creates a windfall opportunity to reclaim additional mining fee.

Given the complexity and potential value of the reclaim opportunity created by this decision, affected businesses may benefit from engaging advisers with expertise in pursing high-value windfall tax reclaim opportunities. Our experts, who are regularly involved in additional mining royalty refund cases, are available to assist in assessing the reclaim opportunity and advising on any potential claim.