In 2010, Hungary’s Fidesz-led government decided to amend a law that regulates the operation of pharmacies. The amended “Gyftv” law, in particular, required pharmacists, who are basically Hungarians, to become the majority shareholders of the pharmacies they work in.
In addition to that, another regulation prevented investors from holding shares in more than four pharmacies, which blocked any expansion of pharmacy chains in the market. Approximately 40% of existing pharmacy chains belong to investors from other EU member states.
Budapest’s move triggered the reaction of foreign investors, who claimed that the new regulations violated the EU single market rules and pose a threat to the liberalisation of the sector which started in 2006.
There are also fears that it could set a precedent and create spill-over effects in other EU pharmaceutical markets.