The right of first refusal A right that allows the holder to step into an already negotiated sale. The holder accepts the purchase offer that the seller has already accepted and becomes the buyer in place of the original buyer, under the same terms and conditions. The basic rules are set forth in the Civil Code (Act V of 2013), and are supplemented by separate legislation for certain types of real estate.
Following the 2025 amendment to the Land Transactions Act, preemptive purchase procedures for agricultural and forestry lands will be conducted through a new publication and IT system starting January 1, 2026.
A real estate sale can still fall through even if the seller and buyer have agreed on all terms. If a right of first refusal applies to the property and the seller fails to properly notify the entitled party of the purchase offer, the entitled party may file a lawsuit to have the contract declared void as against them. The holder may then step into the buyer’s shoes by accepting the offer. Therefore, in the sale of co-owned property, agricultural land, or property in which a local government has an interest, it must be clarified before accepting the offer who holds the right of first refusal.
Table of Contents
- Who is entitled to a right of first refusal on a property?
- What should you do when selling a property if it is subject to a right of first refusal?
- What happens if the seller bypasses the person with the right of first refusal?
- Four Misconceptions About the Right of First Refusal
- Where does the right of first refusal appear in corporate law?
- Situations Where a Real Estate Sale May Be Delayed Due to a Right of First Refusal
- Frequently Asked Questions About the Right of First Refusal
Who is entitled to a right of first refusal on a property?
The right of first refusal may arise from a contract or from law.
In the case of joint ownership, a co-owner has a right of first refusal if another co-owner were to sell his or her share to a third party.
Under the law, the state, a local government, or another specifically designated entity may also be entitled to such rights. Such cases relate, for example, to farmland, World Heritage sites, and properties adjacent to expressways.
A contractual right of first refusal is established by agreement between the owner and the entitled party and must be set forth in writing. If the property has a single owner and neither a contract nor any law grants a right of first refusal, the seller is under no such obligation.
What is the order of priority if multiple preemptive rights apply to a single property?
If there are multiple entitled parties to the same property, the law specifies the order of priority. The under the law based on pre-purchase law prevents a contractual pre-purchase right. If however more under the law based on pre-purchase law collides with, the given separately laws and regulations provisions must examine. These may determine and the priority. Furthermore, the law that took effect earlier takes precedence.
What should you do when selling a property if it is subject to a right of first refusal?
Due to the right of first refusal, the sales process includes an additional step. The terms agreed upon with the buyer must first be offered to the party entitled to the right of first refusal.
- Check the title deed, any previous contracts, and whether any specific legislation grants a right of first refusal on the property.
- Before entering into the contract, provide the accepted purchase offer in writing, in its entirety, to all parties entitled to preemptive purchase rights.
- Please wait for the eligible party's statement within the applicable deadline.
- If the eligible party accepts the offer, enter into a contract with them, because the contract is formed between them under the terms of the offer.
- If the entitled party waives their right or fails to make a statement by the deadline, and the applicable law deems this a waiver, enter into the contract with the original buyer.
- Attach to the application for registration in the real estate registry a statement from the entitled party indicating that they are not exercising their right of first refusal.
The final step is prescribed by the implementing regulation of the Act on the Real Estate Registry, Government Decree No. 179/2023 (May 15). The timing of when the contract can be concluded with the original buyer depends on the group of eligible parties and the rules governing them.
How much time does the eligible person have to make a statement?
The deadline depends on the basis of eligibility and the type of property. For agricultural land, the eligible party must submit a statement of acceptance within 60 days of the start date of the public notice. For properties adjacent to expressways, the deadline is 15 days from the receipt of the offer. In World Heritage sites, the deadline is 30 days from the receipt of the request.
This time frame must be incorporated into the schedule agreed upon with the buyer. For example, the sale of farmland cannot be finalized within a few days due to the 60-day deadline. It is advisable to clarify the applicable deadline for the specific property from a legal standpoint before initiating the transaction.
What happens if the seller bypasses the person with the right of first refusal?
If the owner fails to disclose the offer, the contract entered into with the original buyer is void as against the person entitled to preemptive purchase. The contract is therefore concluded between the seller and the buyer; however, the parties may not invoke it against the person entitled to preemptive purchase.
This does not automatically make the entitled party a buyer. The entitled party must assert the invalidity of the contract in court and, at the same time, make a declaration of acceptance. The entitled party must also prove that it is capable of performing the contract. If successful, the entitled party will take the place of the buyer upon acceptance of the offer.
As a seller, a company may thus face a lawsuit even after a transaction has already been signed. The risk persists even if the right is based on legislation and is not listed on the title deed.
Four Misconceptions About the Right of First Refusal
„The owner is free to sell if there is no registered right of first refusal.” This is incorrect. A statutory right of first refusal may exist even without registration, and the owner must still disclose the offer in such cases.
„If the beneficiary does not respond, the sale is approved.” If a eligible no replies, the sale only then can be continued down the original with the customer, if a eligible for him/her guaranteed, legislation or the general civil legal rules based on guiding deadline without success has passed, and other priority enjoyer eligible nor wishes to practice a right.
„Only a co-owner may have a right of first refusal.” This is also incorrect. Under the law, the state, a local government, or another specified entity may also be entitled to this right.
„Once the contract is declared void, the entitled party automatically becomes the buyer.” The entitled party must assert the invalidity in court and, by means of a declaration of acceptance, take the place of the buyer.
Where does the right of first refusal appear in corporate law?
A right of first refusal also arises in connection with the transfer of corporate interests, such as business shares. These rules are set forth in Book Three of the Civil Code. If a company’s real estate assets change hands through the sale of a share, the corporate law provisions must also be examined. The documents and declarations required for registration in the real estate registry are part of the administrative procedure.
Situations Where a Real Estate Sale May Be Delayed Due to a Right of First Refusal
In the following situations, the outcome depends on the specifics of the particular property and the relationship between the parties, and it can be difficult to reverse a misstep later on.
- If there are multiple entitled parties with respect to the same property—for example, a co-owner and a local government—the order of priority determines whose statement of acceptance prevails.
- A previous contract contains a right of first refusal, and the question is whether this provision was validly established in writing and whether it has been registered.
- The property is agricultural land, is located within a World Heritage Site, or is adjacent to an expressway; therefore, different deadlines and procedures apply to it.
- Since the offer was not communicated, the contract is void with respect to the entitled party, and the entitled party may step into the buyer’s shoes in the lawsuit.
- Although a right of first refusal has been registered, the statement from the entitled party is missing; therefore, registration of ownership cannot be requested.
In these situations, a legal review prior to accepting a purchase offer protects the company and its decision-makers. Our Work in Real Estate Law As part of this process, we help identify preemptive rights, prepare the notice of the offer, and handle the statements from the entitled parties. Other topics include Our Articles on Real Estate Law can be found there.
Before accepting a purchase offer, in addition to reviewing the title deed, you must also verify whether any specific legislation grants a right of first refusal, as such a right may exist even without registration. In the case of farmland, the 60-day deadline for filing a declaration must already be incorporated into the timeline of the agreement concluded with the buyer.
Frequently Asked Questions About the Right of First Refusal
Who has the right of first refusal if I sell my property?
In the case of joint ownership, the co-owner may be the state, a local government, or another specifically designated entity, as provided by law. A right of first refusal may also be granted by contract; this must be set forth in writing. If there are multiple entitled parties, the law specifies the order of priority.
What should I do if I want to sell the property but it is subject to a right of first refusal?
The accepted purchase offer must be communicated in writing and in its entirety to all entitled parties prior to the conclusion of the contract. If the entitled party accepts it, the contract is concluded with that party under the terms of the offer. In the case of a registered right of first refusal, the entitled party’s statement that they are not exercising their right must be attached to the registration of ownership (unless the law provides for an exception).
How much time does a person eligible for preemptive purchase have to respond?
The deadline depends on the type of property. For agricultural land, 60 days following the first day of public notice; for properties adjacent to expressways, 15 days from the receipt of the offer; and for properties located in a World Heritage Site, 30 days from the receipt of the inquiry.
What happens if the seller does not disclose the offer to the entitled party?
The contract entered into with the original buyer is void as against the entitled party. The entitled party may enforce this in court if he or she makes a declaration of acceptance and proves that he or she is capable of performing the contract. In that case, he or she takes the place of the buyer.
If the right of first refusal has not been registered, can I sell the property freely?
Not necessarily. A statutory right of first refusal may exist even without registration. In such cases, the owner must still notify the entitled party of the accepted offer.
If the company is selling real estate for which a right of first refusal may apply—whether based on co-ownership, municipal authority, the government, or a contractual provision—the first step is to identify all eligible parties before accepting the purchase offer. We determine who is entitled to the right of first refusal, prepare the written notice of the offer, and handle the statements of acceptance or waiver from the entitled parties, as well as the relevant provisions of the purchase agreement. You can also meet with us in person at our Budapest office, and we are available at [email protected] titled, the +36 1 200 3447 by phone, as well as at the on our Contact page via the form provided.
