German Lawmaker Urges EU to Scrutinize Orban’s Grab for Airport
(Bloomberg) -- A senior member of the German parliament has written to the president of the European Commission setting out his concerns over potential underhand tactics from Hungary in its attempts to buy Budapest Airport.
Gunther Krichbaum, head of the German parliament’s European affairs committee and a member of Angela Merkel’s Christian Democrats, asked Ursula von der Leyen to conduct a review of Hungarian Prime Minister Viktor Orban’s efforts to nationalize the airport in a letter seen by Bloomberg and confirmed by Krichbaum’s office. Writing on behalf of the committee, Krichbaum urged the commission to specifically examine whether Orban is respecting “the principles and law” of the European Union.
“Should the Hungarian government prevail and initiate a nationalization -- even by way of expropriation -- this would not only be a bad sign in terms of economic policy but also a highly problematic process from a legal point of view,” Krichbaum said in the letter dated June 28. “The Hungarian government’s effort will add to uncertainty among investors.”
Orban’s government has been trying to get its hands on the airport since last year. Bloomberg first reported in October that allies of Orban had approached the airport with an unsolicited offer. Earlier this month, the government itself made a non-binding offer to buy the airport, which people familiar with the matter said was below fair market value.
The airport’s German operator AviAlliance has repeatedly said it doesn’t want to sell and has expressed concerns about the Hungarian government’s use of hardball tactics to try and force their hand. These included blocking pandemic aid and permits to develop the facility, as well as harsh criticism in government friendly media of how the airport is run, which the operator considers unfounded. AviAlliance, which is also the biggest shareholder in the hub, declined to comment on the letter.
Von der Leyen has yet to reply to Krichbaum. However, the topic is still being discussed in Berlin. A group of members of parliament from different committees met behind closed doors on Thursday for an update on the situation, according to Krichbaum’s office.
The Hungarian government has been seeking to reduce foreign ownership in an increasing number of industries it considers strategic, and it has said the capital’s hub is key for tourism and broader economic development. The airport’s privatization started in 2005 and the Hungarian government sold its remaining stake in 2011, a year after Orban returned to power. The concession agreement lasts until 2080.
As he gears up for parliamentary elections next year, Orban is coming under fire on multiple fronts. The commission has delayed approval of Hungary’s recovery plan saying it doesn’t go far enough in combating corruption, potentially risking the timely arrival of billions of euros in funding. The EU’s executive arm has also launched legal action against legislation that expands a crackdown of LGBTQ rights.
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