Usufruct Right 2026: New Regulations & ECJ Ruling

The right of usufruct (haszonélvezeti jog) is one of the most sensitive areas of real estate law, which I encounter most frequently in my practice in connection with property transfers and family inheritance matters. The ruling of the Court of Justice of the European Union (ECJ / CJEU) in May 2026 shook the foundations of domestic regulation, particularly regarding agricultural land. This decision represents a significant opportunity and, at the same time, an obligation for those usufructuaries and owners whose rights were previously unilaterally cancelled by Hungarian legislation. Below, we clarify the essence of the new ruling and the practical steps to take.

The Ruling of the Court of Justice of the European Union and the Legal Background

What is the Role of the Right of Usufruct According to the Civil Code?

Under Section 5:35 of the Hungarian Civil Code (Ptk.), based on the right of usufruct, the beneficiary (usufructuary) may possess, use, utilize, and collect the fruits of the property owned by another person. This means that the usufructuary's right precedes that of the owner: the owner can only exercise their rights of use to the extent that the usufructuary does not exercise theirs.

In my practice, I most frequently encounter three types of usufruct. First, the usufruct right of the surviving spouse in inheritance matters, regulated under Hungarian law by Section 4:68 of the Civil Code. Second, usufruct established by contract (for example, concurrently with a purchase or donation), and finally, the statutory right of usufruct established in favor of parents.

The 2013 Land Law and Resulting Legal Disputes

The Hungarian Land Law adopted in 2013 took a drastic step: with effect from May 1, 2014, it cancelled usufruct rights existing on agricultural properties where the usufructuary was not a close relative of the owner. As a result, numerous individuals and companies lost their rights to use land without any compensation.

The ECJ already declared in a 2019 ruling that this provision flagrantly violated the free movement of capital and the right to property protected by the Charter of Fundamental Rights of the European Union.

The 2026 ECJ Decision: Inadequacy of Compensation

The subsequent ECJ ruling, announced on May 13, 2026, declared the Hungarian compensation rules to be in conflict with EU law. Under the previous Hungarian regulation, compensation was calculated based on an extremely rigid formula: one-twentieth of the market value of the land at the time of cancellation was multiplied by the number of years that elapsed between the cancellation and the re-registration.

According to the ECJ's latest stance, this method of calculation completely ignores the usufructuary's lost profit (elmaradt haszon). The right of usufruct is not merely a theoretical asset value, but it secured the opportunity to obtain regular income from the actual cultivation, leasing, and utilization of the land. The EU court ruled that the amount of compensation must align with the actual loss suffered by the usufructuary, and an automatic formula based on one-twentieth of the market value is not suitable for this.

Practical Steps for Affected Parties

Opportunities for Former Usufructuaries

If your usufruct right on an agricultural property, or that of your relative, was cancelled after 2014 due to the lack of close relative status, you may be entitled to a significantly higher compensation than previously determined based on the 2026 ECJ ruling. Under the ruling, Hungarian courts must review decisions based on the rigid formula and take into account lost rental fees or the value of lost crop yields.

I recommend not delaying the enforcement of compensation claims, as missing deadlines may result in the forfeiture of rights. The lost income must be precisely supported by prior lease agreements, agricultural documents, or expert opinions.

What Should Landowners and Buyers Watch Out For?

If you are purchasing agricultural land, it is of utmost importance to check whether there was a previously cancelled usufruct right on the property and whether any legal dispute has been initiated in connection with it. Following the ECJ ruling, there may be an increase in the number of proceedings requesting the re-registration of usufruct rights, which can impose a serious burden on current owners.

In my office, during the preparation of real estate sales and purchases, I always perform a deep check of the land registry extracts to identify the existence of rights that may have been cancelled previously but remain legally contestable.

The Brandl Case as a Precedent

The main case that triggered the 2026 decision (the Brandl case) was related to the termination of the usufruct right of a Hungarian company. The company deemed the compensation offered by law insufficient, and the Győr Regional Court (Győri Törvényszék) turned to the ECJ for guidance. The court's decision is now binding on all Hungarian courts in pending and newly initiated compensation lawsuits.

Usufruct Right Checklist for Real Estate Transactions

For legal clarity, I recommend taking the following steps before any transaction involving agricultural property:

• Retrieve the land registry extract: Check current and past entries, with particular regard to cancellations after 2014.
• Clarify the usufructuary's legal status: Examine whether the usufruct is based on spouse status, statutory provision, or contract.
• Verify close relative relationship: For agricultural land, check if a family relationship exists between the owner and the usufructuary.
• Obtain a waiver declaration: If the property is to be sold free of encumbrances, a written waiver declaration made by the usufructuary before an attorney is required.
• Assess compensation claims: In the case of previously cancelled usufruct, assess the amount of lost profits with the involvement of an expert.

Frequently Asked Questions About the Right of Usufruct

Are usufruct rights on residential houses and apartments also affected by this decision?

No. The 2026 ECJ ruling applies exclusively to agricultural land affected by the 2013 Land Law. Usufruct rights existing on residential properties (such as those registered in favor of parents or a surviving spouse) are not restricted or modified in any way by this decision.

How can lost income be proven in a compensation lawsuit?

Prior lease agreements, agricultural subsidy certificates, sales invoices, or accounting records can be used for proof. If the usufructuary cultivated the land themselves, a forensic agricultural expert can assist in determining the average yield the area produced during the lost years.

What does the re-registration of usufruct mean?

Following the EU condemnations, Hungarian law made it possible under certain conditions to re-register unlawfully cancelled usufruct rights in the land registry. Under the 2026 decision, the amount of financial compensation claimed alongside or instead of re-registration must be determined by the courts by taking lost profits into account.

How Can I Assist You?

The settlement of usufruct rights and the sale and purchase of agricultural properties require close attention and specialized expertise. In my office, I undertake the assessment of compensation claims related to the cancellation of former usufruct rights, legal representation in litigation, and the drafting of secure sale and purchase agreements for land.

Do not let your rightful compensation go to waste! Contact my office, and we will review your previous case in light of the latest EU ruling. Click here to request a consultation appointment!