In July 2024, the Hungarian Central Statistical Office began sending formal notifications via email regarding changes to the statistical codes of various activities. Although the required procedure takes only a few minutes, non-compliant companies may face penalties.
The 'statistical classification of economic activities' in the European Community, abbreviated as NACE, is a system used by the European Union (EU) to classify economic activities. The term NACE is derived from the French title: Nomenclature statistique des activités économiques dans la Communauté européenne. This classification is integral to a wide range of European statistics across economic, social, environmental, and agricultural domains.
Since the last version, NACE Rev. 2 was published in 2006, the EU economy has undergone significant changes, necessitating an update to this classification system. Over the past few years, Eurostat has collaborated with its partners in the European Statistical System to develop NACE Rev. 2.1, which is now in effect. Starting in 2025, European statistics will be based on NACE Rev. 2.1.
The Standard Industrial Classification of Economic Activities, commonly known by its Hungarian acronym TEÁOR, is based on NACE. Due to the changes in NACE, TEÁOR will also have to be updated. Effective from 1 January 2025, the familiar TEÁOR’08 will be replaced by TEÁOR’25. This update will result in changes to the declared main activity codes for many enterprises. TEÁOR’25 introduces significant changes compared to TEÁOR’08, with activities being split into multiple subcategories or merged in some cases.
Companies required to comply with this update must complete the "1764 form" and submit it electronically via the KSH-Elektra website. The form, which is supported by automation, offers the new activity codes, which now correspond to TEÁOR’25, but in case of uncertainty, there is a guide available online helping to choose the correct new activity code by entering the old one. The form has to be completed by indicating the revenue from the offered activities in 2023. If there is revenue from an activity not listed on the form, the company may insert its TEÁOR’25 code. It is essential that the data provided totals 100% of the revenue. The form will also automatically determine the revenue for the two highest-volume activities according to the new codes. The Hungarian Central Statistical Office requests the exact starting year for these two activities to be indicated.
Non-compliance is taken seriously, as the Statistics Act allows for fines. The government office can impose penalties of up to HUF 200,000 for natural persons (e.g., sole proprietors) and between HUF 100,000 and HUF 2 million for legal entities or organizations with legal personality.
By Denes Glavatity, Associate, KCG Partners Law Firm
