Have the rules on the designer and copyright of architectural works changed?
As we reported in the first article in our series on the New Construction Act, the majority of the rules in Act C of 2023 on Hungarian Architecture (“HAA”) took effect on 1 October. The second article of our series dealt with certain key changes in the regulation of advertising under the HAA. In the recent Part III of our series, we will discuss the rules that apply on the designer, as the mandatory supervision and liability insurance of the designer, as well as the articles on the copyright of architectural works.
1. Designer
The HAA incorporated some of the provisions of Act LXXVIII on the Development and Protection of the Built Environment (“DPBE”) relating to the designer continuously into the current legal environment. However, certain provisions have been amended.
The term “designer” is still used to refer to individuals engaged in the practice of architectural and engineering design. The activities of design and that of the technical expert in the field of construction are closely related. It is a legal requirement that both activities are carried out only by individuals who are registered as designers and technical experts. [HAA, Section 68]
Architectural Design Activity
Section 185 (1) of the HAA defines the concept of architectural design activity. This encompasses the preparation and examination of the architectural documentation essential for the construction, expansion, renovation, alteration, restoration, modernisation, demolition, removal, conversion of use, and supervision of the design of a building, a portion of a building, a group of buildings, landscape and garden architecture.
Supervision by the Designer
According to the DPBE the supervision was part of the designer’s duties only if he had been specifically commissioned by the employer to perform such work. The employer was obliged to appoint a designer to supervise only for construction activities subject to simple notification, such as the construction of residential buildings with a total useful floor area of less than 300 sqm. By contrast the current provisions of the HAA explicitly require the involvement of the designer – who drew up the architectural documentation – as supervising designer during the execution of the plans. Therefore, the designer shall carry out tasks of the supervisor even in the absence of a specific mandate. Thus, the designer is obliged to oversee the implementation of the drawn-up plans and to assist in the resolution of any technical issues that may arise. [HAA, Section 187]
Pursuant to the enabling provisions of the HAA the Government will issue a decree setting out the detailed rules for mandatory supervision by the designer, such as certain mandatory elements of the contract for the activity and in particular the amount of the consideration. However, these rules have not yet been published. [HAA, Section 225 (1) 40.]
Responsibilities of the Designer
The new legislative environment has broadened the scope of the designer’s responsibilities in the execution of their duties. The following table shows how the list of the responsibilities has changed. [HAA, Section 68 (5)]
It is evident that any divergence from the plans and obtaining the occupation permit will require the approval of the designer. According to the justification of the HAA, the legislator’s aim was to safeguard the architectural quality and aesthetic appeal of the buildings. Therefore, it is stipulated that any deviation from the plans during the construction requires the consent of the designer, which is also needed in order to obtain the occupancy permit. In the legislator’s view, this would prevent any negative impact on the appearance of the building resulting from alterations that do not require a building permit.
Section 68 (7) of the HAA states that if the designer does not have the right to exercise the profession, the building authority may impose an administrative fine of up to HUF 1,000,000. The sanctioning of cases where a designer has exceeded his or her qualifications is left to the competence of the chamber. The chamber may sanction the disciplinary offence in the ethical-disciplinary procedure with a warning, a fine, a ban from holding office in the chamber for up to four years, suspension of membership for up to one year, or expulsion from the chamber. [HAA, Section 43]
Liability Insurance of the Designer
A new development of the HAA is its requirement for compulsory liability insurance for those engaged in architectural design activities. The earlier rules only required liability insurance for buildings subject to simple notification. The government has been granted the authority to establish the detailed regulations. [HAA, Section 68 (8)]
The amendment to Government Decree 266/2013 (VII. 11.) entered into force together with the HAA. In accordance with the Decree, the designer is required to obtain liability insurance that covers all damage resulting from the design activities they undertake. The insurance coverage is determined in a banded system.
| Annual net income | Coverage of the insurance |
| x < HUF 20 million | Per insured event: HUF 10 million
Total for the duration of the insurance or annually: HUF 20 million |
| HUF 20 million < x < HUF 100 million | Per insured event: HUF 20 million
Total for the duration of the insurance or annually: HUF 40 million |
| HUF 100 million < x < HUF 1 billion | Per insured event: HUF 50 million
Total for the duration of the insurance or annually: HUF 100 million |
| HUF 1 billion < x | Per insured event: HUF 100 million
Total for the duration of the insurance or annually: HUF 200 million |
Architectural Design Contract
The regulation known from the DPBE, according to the contract must be concluded in writing and must specifically stipulate the possibility and conditions of using a co- or sectoral designer, and that the designer’s fee is due upon delivery of the design documentation, unless otherwise provided, has been supplemented by the fact that the designer preparing the architectural documentation undertakes in the contract to perform the designer supervision during the construction.
In addition to the HAA, the Government Decree 266/2013 (VII. 11.) also contains provisions on architectural design contracts. The amendment to the Regulation, which also entered into force on 1 October 2024, introduced significant changes to the content of the contract. Pursuant to Article 17 (1) of the Regulation, the contract shall include the following:
a) a precise description of the design activity,
b) the requirements for the construction documentation, the level of detail of its elaboration,
c) the number of copies of the documents to be produced and the obligation to transmit them electronically,
d) the deadlines for completion, taking into account the staged handover of the plans,
e) the amount of the designer’s fee, the form and method of the settlement and the certificate of performance, and the method and deadline for payment,
f) a possible technical collateral,
g) the designer’s declaration of its mandatory liability insurance and the insurance policy,
h) provisions on copyright,
i) provisions for reviewing and monitoring the plan,
j) the rules for any plan amendments that may be necessary,
k) the detailed rules of the supervision by the designer, if the designer performs such task,
l) in the case of an e-logbook, the identifier of the designer and the contractor.
2. Copyright of Architectural Works
Recommended License Fee
The HAA did not amend substantially the provisions of the DBPA that entered into force on 1 January 2019. The provisions have been implemented between Sections 191 and 192 of the HAA. Under the current provision, the national chambers continue to regulate in their common regulation the recommended fees that the holder of copyright or other intellectual property rights in an architectural work or architectural documentation may charge the owner of the building for repeated exploitation of the design in connection with a building already constructed on the basis of it.
The legislator deemed it necessary to impose a fee in order to prevent the designer from abusing their copyright in the event that the owner of the building wishes to carry out a construction activity which requires the reuse of the copyrighted documentation. By establishing the recommended fee as a reference point, chambers can provide guidance to parties in the negotiation of agreements and in the resolution of copyright disputes before the courts.
The State as Copyright Holder
A special situation arises if the Hungarian State is the copyright owner of the architectural work. In this case, the fee for the exploitation shall be charged in accordance with the chambers’ recommendations. This can happen in the case of architectural documents created by state, council or municipality-owned design companies that have dissolved without succession. [HAA, Section 191 (5)] In the case of state, council or municipality-owned design companies that have dissolved by succession, the copyright and other intellectual property rights, until proven otherwise, belong to the State as part of the national property. The latter is most likely to be the case for companies privatised after the change of regime in Hungary.
Interestingly, the Constitutional Court also examined the transposed provisions in its decision 3404/2021 of 15 October 2021. The petitioner filed a constitutional complaint concerning the succession of the copyrights by the State. In the petitioner’s view, the legal presumption of succession of the copyrights to the State has deprived copyright holders of their rights, and therefore violated legal certainty. The Constitutional Court dismissed the complaint on the grounds that the legislation did not seek to change the legal position of those who lawfully own copyright or other intellectual property rights. In fact, the legislation merely reversed the burden of proof by requiring the successor to the former state, council or municipality-owned company to prove that the state expressly transferred the copyrights at the time of privatisation. The provision is therefore not contrary to the Constitution.
Register of Architectural Copyrights
The HAA did not amend the provisions of the Register of Architectural Copyrights. The register is part of the National Register of Architecture. The copyright register is available at this link. In a following part of our series, we will provide a comprehensive overview of the provisions on the registers in the HAA.
The copyright of architectural works and the register of architectural copyrights have been discussed in more detail in our previous articles. As there are no substantive changes in the HAA, these articles continue to apply in the current legal environment.
Authors: Zsanett Szabó and Csongor Fillár
