Hungary to create watchdog to oversee EV battery plants, boost fines for polluters

Hungary will raise the maximum fine for pollution ​by large manufacturers, including of batteries, to ​5 billion forints ($16 million), Prime Minister Peter ‌Magyar ​said on Thursday, in a shift from his predecessor's drive to attract EV battery plants. Former Premier Viktor Orban, who was ousted by ‌Magyar in an April election after 16 years, bet big on EV batteries, attracting foreign investment mainly from South Korean and Chinese manufacturers, and making Hungary a major hub in Europe.

Magyar said a new environmental ‌authority, which the government flagged earlier this summer, will strictly monitor battery manufacturing, recycling and decommissioning. "We ‌will not compromise on the health and safety of the Hungarian people for the sake of any single investment or any single investor," he said.

The government will also raise sanctions and fines for environmental violations to create a real deterrent ⁠effect, Magyar ​said. For the most serious ⁠environmental violations, the cap on fines will be raised to 5 billion forints, and the government will also introduce a 'three ⁠strikes' principle.

"If a large company violates environmental regulations for a third time within five years, there will be ​a minimum fine that is at least half a percent of the company's annual net ⁠revenue," he said. The prime minister cited the example of Samsung SDI's battery plant in the northern town of Göd, which had been ⁠fined ​several times between 2022 and 2023 for exceeding emissions standards.

For Samsung's plant, a half-a-percent minimum fine would be around 5 billion forints, Magyar said, calling it "a fine of a meaningful magnitude." Before the ⁠election, Samsung said its Hungarian factory, which temporarily had its environmental licence suspended, strictly complied with environmental ⁠and safety regulations.

In June, ⁠a government office suspended Chinese battery parts maker Semcorp's production licence after authorities found large-scale aluminium pollution in water samples taken from monitoring wells around the ‌plant. Semcorp ‌said it was investigating. ($1 = 312.0900 forints)