The Sovereignty Protection Office has the power to gather information on any groups or individuals that benefit from foreign funding and influence public debate, and Hungary’s secret services can assist in its investigations.
ADVERTISEMENTHungary has been accused of trying to intimidate civil society after it launched an investigation into Transparency International's Hungary branch.
The Hungarian government's newly formed Sovereignty Protection Office sent a six-page letter to the group on Tuesday, accusing it of "aiming to influence the will of the electorate".
In turn, the European Commission has issued legal proceedings against Hungary for its Sovereignty Office, saying it violates European democratic values and fundamental rights.
Hungary has a few weeks to respond, or the case could escalate to the European Court of Justice.
Budapest denies that the Sovereignty Protection Office is about stifling freedom of information. It insists that the office is independent of the government and aims to provide clarity on funding for NGOs.
Hungary's Minister of European Affairs János Bóka has insisted the office is impartial.
"When you refer to investigation or scrutiny initiated by this office, this is not something that is done by the government. This is something that is done by the office which is institutionally and personally speaking independent of the government," Bóka said.
A lawyer for Transparency International, a non-governmental organisation that aims to tackle corruption worldwide, said that the claims made against it by the office were false.
Miklós Ligeti, Legal Director at Transparency International Hungary, claimed the group were "scapegoated" after they submitted letters to it inquiring about Chinese state finance loans to the Hungarian government.
"China is giving major state finance loans to the Hungarian government to finance the Budapest railway. And this is a very obscure investment with no transparency requirements applying,” said Ligeti.
The Sovereignty Protection Office sprung out of a law passed in December by the nationalist governing party of Hungarian Prime Minister Viktor Orbán, Fidesz.
It has the power to gather information on any groups or individuals that benefit from foreign funding and influence public debate, and Hungary’s secret services can assist in its investigations.