The Austrians won’t accept being forced out of GYSEV – they are taking Lázár’s ministry to court

From July, 752 kilometres of railway track will be transferred from the MÁV group into the operation of Austrian-Hungarian joint company GYSEV Plc., the Ministry of Transport has recently announced. This measure affects 13 railway lines in the north-western part of Transdanubia, with the freed-up vehicles eventually serving in the eastern part of the country. (The operation of the lines does not automatically mean the takeover of passenger transport activities; from 1 July, this will initially happen only on the Zalaegerszeg-Celldömölk section, with GYSEV assuming public service on the other lines gradually.)

At the beginning of the year, János Lázár had already announced that GYSEV’s resources would be more extensively integrated into Hungarian railway transport. He also mentioned that from the summer peak season, GYSEV would take on additional tasks.  The Minister of Construction and Transport made the announcement after the Hungarian state gained a qualified majority in the 150-year-old Austrian-Hungarian railway company, allowing it to make all significant decisions independently. As previously reported, the Hungarian side used shrewd manoeuvring to prevent the Austrian state from participating in the capital increase and raised its ownership stake above 75% at an extraordinary general meeting held just before Christmas. As a result of this move, the minority owner became entirely vulnerable to the Hungarian side.

GYSEV submitted its application for the registration of the forcibly implemented changes, including the capital increase and the new ownership structure, to the Company Court of the Győr Tribunal on 16 January. However, the Austrian co-owner did not accept getting the short end of the stick, and legal proceedings have begun. The plaintiff is the Austrian Ministry of Transport, while the defendant is GYSEV Plc., with the Ministry of Construction and Transport intervening in support of GYSEV. Virág Heinzelmann, the lawyer representing the Austrian state at the general meeting, submitted a declaration to the Company Court, stating that the Hungarian state’s capital increase had not been approved by the Austrian side. According to her, the Hungarian side acted unlawfully by excluding the Republic of Austria from the capital increase, despite the latter meeting all the necessary prerequisites.

The legal representative cited a provision of the Civil Code, which states that the validity of a general meeting resolution deciding on a capital increase is conditional on “shareholders of the given share class or category affected by the capital increase – as defined in the articles of association – providing their separate consent in accordance with the articles of association”. This condition was not met, as recorded in the minutes of the general meeting, which clearly state that the Republic of Austria did not approve the Hungarian state’s capital increase, rendering it invalid in the lawyer’s view. In her lawsuit, she challenged the disputed general meeting resolutions and requested the suspension of the registration process.

Heinzelmann also referred to fundamental principles of the Civil Code, such as good faith and fairness. Among the arguments, she noted that priority rights had been violated; in a cash capital increase, shareholders have a priority right to acquire shares, and the company must provide at least 15 days for them to exercise this right.

The Austrian submission suggests that the true purpose of the Hungarian state’s acquisition of over 75% ownership is to “use GYSEV’s vehicles and human resources for other purposes.” Furthermore, the situation now allows the Hungarian state to unilaterally amend the articles of association, decide on mergers or demergers,

or even shut down the company’s Austrian branches and railway network.

Mohos Márton / 24.hu

Whether the Hungarian side has such intentions remains unknown, but it is a fact that Lázár’s team has once dismissed the Austrian branch’s deputy CEO without prior consultation.

The Austrian legal representative justified the suspension request by stating that it would prevent the unilateral capital increase and amendment of the articles of association. GYSEV and the intervening MCT requested the rejection of the application, arguing that the plaintiff had provided no evidence, only assumptions, and that there was no immediate legal protection required. The court sided with Lázár’s team, rejecting the Austrian request for suspension. This means that despite the ongoing legal dispute, the Company Court may register the contested general meeting resolutions and the capital increase. At the time of writing, the Justice Ministry’s database already reflected the registration of the lawsuit for the review of corporate resolutions, and the Hungarian state’s HUF 890 million capital increase was in the process of being recorded. The judge was not convinced by the Austrian side’s arguments, as they only outlined potential future events without presenting supporting evidence.

However, this is not the end of the story, as the substantive part of the case is yet to come. Whether the disputed resolutions are unlawful or violate the company’s articles of association has not yet been examined in this procedure. The legal and factual basis of the claim will be assessed in the substantive proceedings, where a final decision will be made.

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