THE DUTIES OF MNV ZRT.

 

 

 

 

The duties of the Hungarian State Holding Company and the National Holding Board are set out in the most important framework rules of the State Assets Act; the Act defines the transactions, procedures, subject matters, concerning which the National Holding Board (hereinafter: Board) and/or MNV Zrt. have exclusive powers as regards state assets.

 

The shareholders’ rights over the Hungarian State Holding Company are exercised by the Minister of Finance on behalf of the State; the Minister may decide matters subject to powers of the General Assembly or, in certain specified cases – based on the legal requirement concerning single-shareholder companies – also matters that belong to the powers of executive officers.

 

The business management of the company is provided for partly by the State Assets Act and party by Act on Public Finances.

 

MNV Zrt. records the assets over which it exercises ownership rights on behalf of the State separately from its own assets, in line with which it unbundles own revenue and expenses from the revenue and expenses arising in the course of managing assets.

 

Among the provisions containing the general requirements for exercising rights, the Act fixes the procedure for establishing or dissolving state-owned companies and the framework rules to be applied in both cases.

 

With regard to this, the State Assets Act determines the general principles and goals associated with further privatisation and provides the framework rules for administering such privatisation. The technical details of implementation are set out in a government decree.

 

 

The duties and legal status of MNV Zrt.

MNV Zrt.:

a) prepares and implements the Board’s decisions concerning state assets;

b) keeps records of the state assets, and provides data based on these records;

c) manages the state assets in respect of which ownership rights are exercised by the Board directly or through civil law contracts;

d) regularly controls the management of state assets by persons and organisations contracted by it: it informs the Borad, the Audit committee, the audited body, as well as the Minister in charge of supervising state assets and the State Audit Office if necessary about its findings;

e) represents the State of Hungary in civil law matters associated with state assets;

f) it checks performance of the obligations assumed by buyers in sales contracts.

 

MNV Zrt. is a single-shareholder joint stock company established by the State of Hungary, its share is non-marketable. The Government has the power to prove and amend its Deed of Foundation. MNV Zrt. may not be transformed, divided or merged with any other company. Any decision on its termination may be adopted only by the Hungarian Parliament and only in a legislative act.

Unless otherwise provided by the State Assets Act, the rules of the Companies Act shall apply to MNV Zrt’s operation.

The shareholder’s rights of the State of Hungary in MNV Zrt. are vested with the Minister in charge of supervising state assets, with the exception defined in this Act. The powers of the General Assembly are exercised by the organisation or person representing shareholder rights.

Acting in the powers of the Supervisory Board, an Audit Committee controls the operation of MNV Zrt. The provisions of Article 38-39 of the Companies Act do not apply to the Audit Committee.

MNV Zrt’s activities are audited by the State Audit Office annually.

The rues applicable to the establishment, possible termination of the Company and the exercising of founder’s rights basically followed provisions in the fact concerning ÁPV Zrt. (the Deed of Foundation was adopted by the Government). The only difference compared to those rules is that there is no Supervisory Board in operation at MNV Zrt., all of the control functions are fully performed by the Audit Committee mentioned above.

Management of state assets

MNV Zrt. manages state assets by itself or it may let a body of the central budget, a natural or legal person or business company without legal personality manage state assets based on a contract such as rental, lease, usufructuary lease based on contract, asset management or assignment.

The primary goal of contracts concluded for managing state assets is to efficiently operate and preserve the condition of state assets, to preserve and increase their value and to promote the performance of state and public tasks.

MNV Zrt. may conclude only contracts that are the most favourable in respect of finance and economy for the State of Hungary based on expected revenue, savings or other benefits, while preserving and increasing state assets for asset management.

MNV Zrt. manages arable land in state ownership in accordance with the provisions of the relevant separate law and the landholding policy guidelines regulated in that law.

The rules of asset management

MNV Zrt. may conclude asset management contracts for managing state assets. Under such asset management contracts, the asset manager is entitled to hold, use and collect the benefits of the defined state-owned things. The asset manager must preserve the value of the asset, ensure that its condition is preserved in a good status, it is operated properly, and must pay the fee or perform any other obligation required under the contract.

Asset management contracts may also be concluded for delegating the right to exercise a right that belongs to the State, in which case the rules applicable to asset management of things must apply as appropriate.

The asset management right is created by the relevant contract, or in the exceptional cases, by law.

The Government specifies further rules on asset management and the rules for recording the state assets managed and the related revenue and expenses in decrees.