Environmental protection in focus: new national supervisory authority and tougher sanctions

The National Authority for Living Environment Supervision will commence operations on 1 January 2027, with broader powers and more stringent enforcement tools than previously available. Under the proposed legislation, the most serious environmental violations could result in fines of up to HUF 5 billion, while repeated infringements could trigger penalties with a minimum amount equivalent to at least 0.5% of the offender’s annual net revenue.

Environmental protection has been given a prominent role in the new government's agenda. Earlier this year, the “Clean Hungary Programme” outlined the key pillars of the country's new environmental strategy, including “strict inspections and swift sanctions against polluters.” In line with this objective, authorities launched inspections of battery industry investments during the summer of 2026, which in certain cases resulted in the suspension of operations at specific manufacturing facilities.

This trend is further reinforced by the establishment of the National Authority for Living Environment Supervision, announced in early September 2026, which is expected to begin operating with nationwide jurisdiction on 1 January 2027.

The new Authority will consolidate responsibilities relating to environmental protection, nature conservation, climate protection, animal welfare, water management, water protection, and forestry supervision. In addition, environmental oversight of the battery industry, which has been treated as a strategic sector in Hungary in recent years, will become a key focus area within the Authority. As stated in the proposal:

“The Authority will be responsible nationwide for environmental permitting, inspections, and enforcement related to battery manufacturing and battery waste management.”

The effectiveness of the new Authority would be supported by stricter sanctioning mechanisms, which are currently subject to public consultation.

Under the proposal, the maximum environmental fine that may be imposed for non-compliance with environmental permits or integrated environmental permits would be increased. For companies generating at least HUF 100 million in annual revenue and carrying out activities subject to complex regulatory permits, the current maximum fine of HUF 2 billion would be increased to HUF 5 billion.

In addition, for repeat environmental offenders with significant revenue, not only the upper limit but also the minimum amount of the environmental fine would be defined. Under the new rules, the fine would amount to at least 0.5% of the company’s previous annual net revenue, but no less than HUF 5 million.

Furthermore, the legislative proposal would remove the current HUF 500 million cap on waste management fines applicable to legal entities. This amendment would provide authorities with an even stronger enforcement tool against companies failing to comply with obligations arising from extended producer responsibility (EPR) regulations.

It is important to note that these stricter sanctions are largely based on legal obligations that are already in force today, and whose breach may currently result in fines of up to HUF 2 billion. Consequently, companies should place particular emphasis on environmental compliance, full adherence to regulatory obligations, and the establishment of robust reporting processes, as these remain the most effective means of mitigating future risks and avoiding sanctions.

Deloitte’s specialists can support companies in designing and strengthening their compliance control environment in several key areas, including:

Battery Regulatory Readiness Review

For participants across the battery industry value chain, Deloitte offers a targeted readiness assessment focused on preparedness for anticipated regulatory inspections and heightened environmental expectations.

The review covers, among others:

• Alignment between permits and actual operational practices
• Management of hazardous substances and emergency preparedness
• Compliance with BAT (Best Available Techniques) and monitoring requirements
• Controls over waste management and supply chain service providers

As a result of the assessment, companies receive a prioritized, risk-based action plan designed to enhance compliance, reduce regulatory risks, and support the maintenance of long-term operating permits.

EPR and Environmental Product Fee Compliance Support

Deloitte provides comprehensive support throughout the entire lifecycle of EPR and environmental product fee obligations, including:

• Review of registration requirements
• Design of data collection, reporting, and disclosure processes
• Compliance process health checks
• Management and outsourcing of ongoing compliance activities

By strengthening compliance frameworks in these areas, companies can better prepare for the increasingly rigorous environmental enforcement landscape expected from 2027 onwards.