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- October 16, 202612°
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Hungary launches a review of BYD incentives and its Szeged factory
The Magyar government has begun reviewing the incentives, tax cuts and publicly funded infrastructure projects provided to BYD during Viktor Orban’s tenure. The company was fined 10 million Hungarian forints for moving soil from the Szeged factory site to agricultural land, while allegations concerning working conditions are also under investigation.
As part of Hungary’s policy of improving its relations with the European Union, the Magyar government has begun reviewing investment agreements signed with China and other countries during the tenure of former Prime Minister Viktor Orban. The review also covers incentives, tax cuts, permits and infrastructure projects funded by public resources as part of the BYD investment.
Officials from Hungary’s Foreign Ministry said at the end of July that the previous government had promised BYD a substantial amount of incentives that had not been disclosed to the public. The officials also said an agreement had been reached to allow approximately 10,000 Chinese workers to enter Hungary.
The Szeged factory and worker allegations
Production is scheduled to begin this year at the electric vehicle factory being built in Szeged after BYD established its European headquarters in Hungary. Allegations emerged during the construction process that workers had been made to work long hours and had not been paid for overtime.
Some Chinese workers interviewed said they had been made to work seven days a week and up to 14 hours a day.
The former minister’s role at the company
Peter Szijjarto, who served as Hungary’s foreign minister under Viktor Orban, also sparked controversy after resigning as a member of parliament in July and taking an executive position at BYD.
Szijjarto could be examined for a possible conflict of interest, as he is alleged to have negotiated the terms of BYD’s investment in Hungary while serving as minister.
Fine imposed over soil moved at the factory site
BYD was found to have moved soil from the factory site to approximately 20 hectares of agricultural land without carrying out the required tests. An investigation was launched after pollutants were found in part of the soil.
Subsequent tests found that pollution levels did not exceed legal limits. The company was nevertheless fined 10 million Hungarian forints, and the investigation was reported to be ongoing.
BYD Vice President Stella Li said the company had complied with local rules and remained committed to the factory investment.
Environmental regulations targeting Chinese companies
The Magyar government has begun removing exemptions granted to battery factories that violate environmental rules. Several Chinese companies have been fined on the grounds of regulations concerning the storage of hazardous waste and environmental violations.
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