a

Making Political Finance

and Advertisement
in the Visegrad Region
More Transparent

Basic report
Slovakia, Czechia, Poland, Hungary
November 2022
1
Introduction
Political advertising in the online environment
is on the rise in Europe, but the current
regulation, fragmented among individual
member states, does not correspond to
such a trend, with serious gaps in the trans-
parency of the expenses of political actors.
The amount spent on political ads in the
Visegrad countries in social media since
2019 exceeds the amounts declared by
political parties at elections by far.
Since January 2019, 280,000 political
or issue-based ads worth 12.5 million euros
were published in Hungary, 135,000 ads
worth 9.8 million euros in Poland, 135,000
ads worth 5 million euros in Czechia, and
110,000 ads worth 4 million euros in Slovakia.
Politicians, political parties and public
institutions are among the largest clients
purchasing advertising on social networks.
The European Commission responded
to these new challenges by proposing legisla-
tion aimed at the transparency and targeting
of political online advertising, which should
come into force ahead of the 2024 European
election. The proposed EU legislation also
gives the Member States the oppor-
tunity to reform the rules of political
campaigns on the national level.
To aid this effort is the goal of an
international project financed by the Visegrad
Fund, in which four non-governmental
organizations are involved: Transparency
International Slovakia (Slovakia), Whom to
vote for (Czechia), K-Monitor Public Benefit
Association (Hungary), Political Account-
ability Foundation (Poland). The series of
elections that recently took place in the
Visegrad countries was a good opportunity
to map the situation, point to malpractices
in online political advertising and propose
recommendations.
This introductory report summarizes
the first results of the work of individual
expert teams to be shared with media,
activists and the general public. It is an
1 Eurostat – Households – level of internet access, 3/2022
2 Eurostat – Individuals – frequency of internet use, 3/2022
3 Go4Insight, General use of social networks in Slovakia, 2–3/2021
initial mapping of the situation in individual
countries which are at different phases of
election cycles, without mutual comparison.
The experts agree that national
regulations fail to sufficiently take into an
account the rise of the phenomenon of
online advertising and the expansion of the
possibilities for circumventing the rules it
creates. The proposed recommendations
are a contribution to the discussion on the
implementation of the new European direc-
tive and the necessary legislative changes.
The monitoring results will be summarized
in more detail in a subsequent report, which
is scheduled to be published in the first
quarter of 2023.
Slovak country report
Media environment in Slovakia
In 2021, the internet was available1 to 90%
of Slovak households and 87% of the popu-
lation used2 it at least once a week. Accord-
ing to a March 2021 survey by the Go4insight
agency, up to 86% of the population of
Slovakia between the ages of 15 and 79
used one of the social networks3 at least
once a month, with Facebook still being the
most widespread network. Daily it was used
by 55% of people from a representative
sample and at least once a month by 76%
of people.
The growing importance of the
internet and social networks in Slovakia
is also reflected in political campaigns.
According to an analysis conducted by the
Kantar agency for Transparency International
Slovakia prior to the last parliamentary
elections in February 2020, political parties
invested about 3.6 million euros in online
advertising. This figure represents a quarter
of the total campaign advertising costs.
2
The summary of monitoring of the joint
municipal and regional elections 2022
Online advertising, especially in form of
sponsored Facebook posts, played an
important role in the campaign before the
joint elections which took place in October
2022. Several candidates for president of
self-governing regions or mayors of large
cities invested thousands of euros in this
method of addressing voters, the highest
amount (estimated at over 30,000 euros)
was paid out by the successful president
of the Košice self-governing region,
Rastislav Trnka.
The intensity of political advertising
on Facebook showed a significant increase
in the final days of the campaign, according
to the analysis of partial data obtained
from transparent bank accounts, which we
carried out at Transparency International
Slovakia.
Despite the fact that the public
could track part of the payments to social
networks directly on the transparent bank
accounts of political parties and candidates,
all of the data is not available to us. A large
part of the campaign (estimated to be
up to 40% of all expenses) was realized
through hefty payments to media agencies,
where the details of the use of these funds
remained hidden from the public. Another
issue is, that parties and candidates are not
obligated to separately declare online
advertising expenses in their final reports.
According to the analysis of Trans-
parency, which we published in cooperation
with the technology company Gerulata
Technologies, candidates for presidents
of self-governing regions and mayors of
large cities paid on average 50 Facebook
posts during the campaign. Ondrej Lunter,
candidate for the president of the Banská
Bystrica region used Facebook promotion
to spread his message most often, a total of
398 times. A close second was the president
of the Košice region Rastislav Trnka with
333 promoted Facebook posts, whose paid
content popped up on the screen of the so-
cial network users approximately 16 million
times. In the case of the second most suc-
cessful advertiser, the mayor of Bratislava,
Matúš Vallo, it was roughly 6 million times.
The candidates tried to appeal to
voters mainly through topics close to the
competencies of municipal governments,
such as transport, education, and social ser-
vices. Among the sponsored as well as the
organically distributed content, however,
there were also critical statements towards
opposing candidates and even outright
anti-campaigns.
The practice of labelling paid adver-
tising with information about the customer
and the supplier, which is mandated by the
current version of the Slovak Election Cam-
paign Act, also proved to be problematic.
Such a label was missing from almost every
other political ad.
The politicians argued, that such
labelling is not necessary since the informa-
tion about post promotion is already pro-
vided by Facebook. However, the extent of
this information cannot be considered suf-
ficient, which was also confirmed to us by
the Ministry of the Interior. “Political adver-
tising published paid advertising, published
election posters and all other methods of
running an election campaign, including
sponsored posts on social networks, must
contain data about the customer and supplier
in the scope of first name, last name and
municipality of permanent residence, if it is
a natural person, and name, registered seat
and identification number of the organization,
if it is a legal entity,” the ministry pointed
out during the campaign.
Some candidates and political parties
modified their bad practice of not labelling
sponsored ads following our criticism.
Other issues we identified were
the so-called mayoral Facebook accounts,
and the abuse of city media channels and
budget for the promotion of politicians
running in the election. It is a widespread
practice that local governments do not only
communicate on social networks through
municipal or regional accounts, but also
through the profiles of mayors or presidents
of regions.
3
Such profiles managed from pub-
lic funds aid in building the popularity of
mayors and presidents of regions outside
of elections, whereas before the elections
politicians use them to conduct their cam-
paigns. Additionally, these political ads are
often interspersed with public service mes-
sages which have a positive PR undertone.
Therefore, it can be difficult for regular
Facebook users to distinguish campaign
posts from reports on the activities of
a municipality.
Before the elections, the official
Facebook pages of cities and regions are
also flooded with PR content that presents
the results of the work of politicians in
a positive light. It often takes the form of
production-intensive output, such as narrative
videos, which cost municipalities a lot of
money. Such covert advertising gives mayors
and region presidents in office an advantage
over their opponents. This is also one of
the reasons why, in the previous elections,
86 percent of mayors and region presidents
were re-elected for another term.
Status of the implementation
of the European regulation
The proposed regulation of the European
Parliament and the Council on transparency
and targeting of political advertising
no. LPEU/2021/740 was the subject of an
interdepartmental comment procedure in
Slovakia in June 2022. The European pro-
posal deepens and tightens several existing
obligations of Slovak political parties and
other entities, which are regulated by Act
no. 181/2014 Coll. on the election campaign
and Act no. 85/2005 Coll. on the political
parties.
The key rules in Slovakia, which apply
to all types of elections, are mandatory
transparent bank accounts and limits on
spending within the election campaign,
including political advertising. As a part of
the campaign, political parties and candi-
dates are obliged to label each paid political
advertisement, whether physical or online,
with information about its customer and
supplier.
The proposed European regulation
recommends extending the obligation to
label political advertisements to the period
outside the election campaign. It also speci-
fies the list of data that should be published
on a compulsory basis (in particular, data
on the amounts spent on advertising, their
connection to a specific campaign, or the
duration of the campaign). The data can
also be available in the form of a link, which
reduces the degree of their immediate
availability.
Equally important is the partial trans-
fer of responsibility for meeting statutory
campaign transparency obligations to politi-
cal ad suppliers, who will have to “use reason-
able efforts” to ensure that the information
required to be published by the regulation is
complete. Should the information be incom-
plete, the suppliers are obliged to refrain
from publishing the ad. Since the regulation
also focuses on the preparation phase of
advertising, it is unclear how this regulation
will be applied in practice. We consider it
beneficial to focus on the online space, which
is currently largely neglected by Slovak legal
regulation and de facto left to the arbitrary
adjustment of application practice.
Policy recommendations
• A more explicit definition of online
advertising, in order to prevent circum-
vention of election moratoriums or other
provisions in the form of non-sponsored
content
• Introduction of the obligation to label
political ads with information about its
customer and supplier, regardless of the
duration of the election campaign
• Tightening of the rules for keeping trans-
parent bank accounts during election
campaigns in order to prevent the hijacking
of campaigns into the non-transparent
environment of media agencies
• Improving the quality of mandatory
reporting on political advertising
expenditures in annual reports of
political parties and reports on election
campaign expenditures, including online
advertising expenditures
4
• Improving the supervision of compliance
with the rules regarding the financing of
politics and political advertising, prefer-
ably by creating an independent control
authority, or at least by changing the
appointment procedure of the members
of the State Commission for Elections
and Oversight of the Financing of Politi-
cal Parties
Czech country report
Media environment in Czechia
New Media
Czech society, like other societies in the
developed world, is highly media saturated:
media content and media technology
objects play an important role in virtually
all aspects of its life, including political life.
Especially in the last two decades, or quarter
of a century, it has undergone many trans-
formations associated with the advent of
digital communication technologies and
especially the Internet. From the perspec-
tive of political science, these changes
are very relevant simply because they are
linked to the question of whether and how
socio-technical changes in the communica-
tion plane translate into possible changes in
the political plane - into changes in political
behavior, into changes in political communi-
cation and into active political endeavor.
Changes on the communication
plane can be considered neither closed
nor in any way monolithic. In the Czech
Republic, 81% of Czechs over the age of 16
already use the internet, and 70% of them
use a smartphone. Almost all 15-year-olds
have access to the internet at home and can
use a mobile phone.
Almost all households have a com-
puter and internet, and just under a fifth of
Czech households are without internet. The
majority of these are households of seniors
who, according to a survey by the Czech
Statistical Office, do not want the internet at
home or do not know how to use it. On the
other hand, 97% of children live in households
4 https://www.czso.cz/csu/czso/internet-pouziva-pres-80-obyvatel-ceska
with an internet connection and 92% have
a computer or tablet at home.
The use of smartphones is growing
dynamically. In 2019, 70% of people aged
16 and over already had one, and even 99%
of young people aged 16 to 24. In contrast,
three quarters of seniors prefer a mobile
phone without an operating system.
Surfing has long since ceased to be
the preserve of the young and college-edu-
cated. The number of users is also increas-
ing among the elderly. The proportion of
people over 65 who go online has tripled
since 2010, from 13% to 39% in 2019. Almost
half of 15-year-olds use the internet at home
for more than 4 hours at the weekend. On
a daily or almost daily basis, 78% of girls this
age are on social media and 66% of boys play
games online.
More than half of adults keep in
touch with their friends through social
networks. In 2019, 45% of companies in the
Czech Republic had a social media account.
Online banking and online shopping are
also growing in popularity among Czechs.
Almost two-thirds of adults (63%) already
have online banking, and 59% of people
shopped online in 2019. A significantly high-
er proportion of people use online banking
in our country than in all of our neighbors.4
New media in the political environment
of the Czech Republic today still means
mainly Facebook. Instagram, Twitter or
Tik Tok are used significantly less.
Parties and candidates often use the
possibility of targeting Facebook advertising
differently, e.g. geographically, by demo-
graphic divisions, etc.
But alongside this, they also use free
organic distribution of their posts.
Traditional media
Much of the media is owned by large fi-
nancial groups. Some of the media is also
owned by the former Prime Minister and
Chairman of the ANO party, Andrej Babiš.
These are significant facts that have a major
impact on how traditional media are used in
political campaigns.
5

Good and bad practices described a party campaign ahead of the local and
by local issues senate elections, when he “supported
the candidates of his ANO party”.
Bad practice: Circumventing campaign In many cases, the campaigning
finance law, hidden campaigning - exam- took place in places where the ANO party
ples of popular anonymous social media was not running for local council or Senate
accounts/projects elections.
There are several popular social media ac- Part of this unacknowledged presi-
counts/projects that have been found to be dential campaign was a brief personal visit
linked to political parties or campaigns or by Andrej Babiš to the location in question,
are very likely to be linked. preceded by advertising on Facebook and
The processing and frequency of Instagram focused on the region in question
publication suggests that in some cases this and also by a listing on the ANO website.
is likely to be professional work. An example of an advertisement
Examples include the still active focusing on the Pilsen region, including
accounts/projects I am appalled! (Jsem a meeting in the town of Plasy, where
zděšena!) on Facebook5, Twitter6 and unsuc- the ANO party was not running candidates
cessfully on Instagram. This project works in and where there were no Senate elections10.
support of the ANO party and its chairman
Babiš.7 Status of the implementation
The Prague 1 Neighbours project of the European regulation
was a Facebook page pretending to be European regulation The proposal for
a community of people living in Prague 1. a Regulation of the European Parliament
However, it turned out that its content was and of the Council on transparency and
created by marketing specialists working targeting of political advertising11 is being
for the ODS party, which was in opposition discussed in the Czech Republic as part of
in Prague 1 at the time8. the overall package on protecting the integ-
rity of elections in the EU.
Good practice The Czech Government discussed
Instagram effectively made such a hidden this item at the end of 2021 with the con-
campaign impossible in the case of the I’m clusion that “In general terms, the Czech
appalled! account by limiting its reach9. Government agrees with the proposal”12.
Meanwhile, in the Lower House of
Bad Practice: Circumventing campaign the Parliament, the European Affairs Com-
finance law - the Babiš example mittee has dealt with the Directive. After
As a presidential candidate, former Prime a short discussion, the Committee agreed
Minister and Chairman of the ANO politi- to take note of the Government’s position13.
cal party, Andrej Babiš, before announcing Neither chamber of Parliament has yet
his candidacy, circumvented the campaign dealt with the directive.
finance law by disguising his campaign as

5 https://www.facebook.com/jsemzdesena
6 https://twitter.com/JZdesena
7 https://www.instagram.com/jsemzdesena/
8 https://auto-mat.cz/25610/chyba-facebooku-odhalila-skutecne-spravce-nezavislych-stranek
9 https://www.instagram.com/p/CYZQAwkqyOi/
10 https://www.facebook.com/ads/library/?active_status=all&ad_type=political_and_issue_ads&country=CZ&q=babi%C5%A1%20plasy&sort_
data[direction]=desc&sort_data[mode]=relevancy_monthly_grouped&search_type=keyword_unordered&media_type=all
11 https://ec.europa.eu/info/sites/default/files/2_1_177489_pol-ads_en.pdf
12 https://www.psp.cz/sqw/text/orig2.sqw?idd=208117
13 https://www.psp.cz/sqw/text/orig2.sqw?idd=205938&pdf=1
6

The current legislative framework

limits the total campaign expenditure for Campaign Spendings (Presidential Election 2020)
parliamentary, presidential, European and Press Radio TV Internet Banners
regional elections. It does not set limits for Press Radio TV Internet Banners
local elections.14
Andrzej Duda 242.13 161.97 4,044,300 4,660,876 8,243,960
These financial limits also include
Rafał Trzaskowski 1,707,830 1,791,427 3,293,000
all online campaign expenditure, including
negative social media advertising. Małgorzata Kidawa-Blońska 2,234,832 707,490 1,377,756

Social media campaign posts must be Szymon Hołownia 31.8 425.41 911,322 691,587 1,270,035

identified by the sponsor. Robert Biedroń 26.61 3.5 123,292 496,303 502,227

Candidates must use transparent Krzysztof Bosak 1.13 442 148,589 178,902 554,138
accounts for campaign financing and keep Source: NEC
separate campaign accounts from the par-
ty’s day-to-day operations.
Similar rules apply to other persons Additionally, the COVID19 pandemic
independent of the candidate parties who has also positively impacted the increase
are involved in the campaign. It is not yet of campaign finance resources allocated to
clear how the new European legislation will online advertisement.
be translated into Czech law. The most used social media platforms
in 2022 were YouTube, Facebook (with
Messenger), Instagram and TikTok, while
Poland country report Twitter taking only the 9th spot. Therefore,
Facebook seems to be the most important
Media Environment in Poland internet advertisement platform for political
Media landscape in Poland is diversified, advertising, followed by Google. [Graph 2]
with public and private TV and radio sta-
tions present across the whole country, but
distinctively divided along political lines.15 Population, Users and Social Media Platforms in 2022
Internet is accessible to 93.3% of house- Total population 37.77

holds, with insignificant differences be- Total Internet Users 32.86

tween urban and rural areas.16 Social Media Users 27.2

TV is still the main source of informa- You Tube 27.2

Facebook 17.7
tion for 52% of the population, while Inter-
Facebook Messenger 15.8
net was selected by 32%, radio by 5% and Instagram 10.7
printed press by only 2% in 2021. The impor- TikTok 7.7
tance/popularity of the Internet has Snapchat 4.9

increased by 16 percentage points during LinkedIn 4.6

the last four years, while there was a decrease Pinterest 4.2
Twitter 2
by 12 percentage points in the case of TV.17
Increasing role of Internet in provid- Source: Datareportal.com

ing information to the population was

reflected in election campaign spending
during the Presidential election in 2020.
Five out of six the most important candi-
dates have spent similar amount on their
promotion on the Internet and on TV. [Graph 1]

14 https://frankbold.org/poradna/korupce-a-transparentnost/korupce-a-jednani-uredniku/hospodareni-s-verejnymi-prostredky/rada/financova-
ni-politickych-str
15 Presidential Election, 28 June 2020 | OSCE
16 Główny Urząd Statystyczny /Main Statistical Office/ Digital Society in Poland in 2022
17 CBOS (Public Opinion Research Centre) Report
7

Campaign Finance Regulations – to anyone interested (source documents

Good and Bad Practices are available first to authorised entities, and
Financing of election campaigns is regu- later to the general public). Mistakes in fi-
lated in several legal acts, like the Election nancial report may result in financial penal-
Code (KW), Act on Political Parties, the ties for the respective election committee.19
Accounting Act or the Criminal Code and In October 2021, Parliament passed
the following principles regarding election an amendment to the Act on Political
campaign spending should be listed as the Parties introducing reporting obligations
most important: for political parties. Every donation and/or
• should be transparent, contract received/signed by a political party
• should be organised and run solely by has to be registered in an electronic format
election committees, created for the on an on-going basis, and be published on
campaign period and acting on behalf a publicly available Public Information Bulle-
of a candidate or political party, tin of the respective political party.20
• should not exceed legally binding expend-
iture caps established for election Bad Practices
campaign spending, Campaign finance reports from every elec-
• should take place within a defined period tion committee are due three months after
of time allocated to the election campaign, the election day, hence, there is no infor-
• each election advertisement should include mation about campaign spending on an
the name of the election committee which on-going basis during the election campaign
funded the material, period. Reports are not available in any
• each election committee should report to electronic format (but only as hard cop-
the National Election Commission (NEC) ies) thus making any analysis of campaign
on financial spending on election cam- finance difficult and time consuming.
paign no later than three months after The regulation, introduced to
the election day. the Election Code in 2018, which allows
a third-party to campaign and to provide
The Election Code restricts election com- an in-kind contribution to candidates or
mittees to seek sponsorship only from their political parties, with no established limits,
founding party (or coalition of parties), has a negative impact on the transparency
organisation or natural persons – citizens of campaign finance.21
permanently living in Poland. Similar restric- Political actors may also release po-
tions apply to political parties. litical ads outside of the official campaign
There are no separate regulations period (and they do so very often). This
addressing campaign and campaign finance practice is not regulated and makes it very
in social media but the NEC has confirmed difficult, if possible at all, to monitor such
in an interpretive statement that general ads’ sponsorship and their origin.
rules apply accordingly.18 This applies to Insufficient regulations related to
campaign silence period as well. the use of administrative resources during
election campaigns resulted in frequent
Good Practices misuse of state resources, especially by
NEC publishes its resolutions with approv- candidates close to the ruling party or the
al (or disapproval) of financial reports government. A process of imposing the so
received from election committees and called ‘party tax’ on employees of state-owned
political parties and makes them available enterprises, which was recently revealed by

18 Państwowa Komisja Wyborcza/National Election Commission (pkw.gov.pl)

19 No report submitted by the political party may result in this party’s deregistration.
20 Anticorruption Act / Ustawa z dnia 14 października 2021 r. o zmianie ustawy – Kodeks karny oraz niektórych innych ustaw (sejm.gov.pl)
21 Art. 106 par. 1 Election Code. Presidential Election, 28 June 2020 | OSCE; third-parties campaigning are not obliged to provide any reports
related to campaign finance issues.
8
the press, points to a regulatory gap in this
area.22
Due to the lack of separate state
regulations related to campaigning in social
media, internal regulations of internet
advertisement platforms, like Facebook, are
the only applicable ones. This creates a situ-
ation of full dependency on internal policies
of such platforms, including data availability
and integrity, if any monitoring or control
of campaign should be implemented.
Status of the implementation
of the European regulation
The proposed Regulation on the transpar-
ency and targeting of political advertising
has been widely consulted with the Polish
government during public consultations
and discussions in the Parliament.
So far, several NGOs and professional
organisations, like Panoptykon Foundation,
Batory Foundation or Lewiatan Confedera-
tion, resented their comments and recom-
mendations regarding the Regulation. Main
issues discussed included i.e. (i) making the
definition of political advertisement more
precise, (ii) increasing the protection of per-
sonal sensitive data, (iii) making targeting
techniques more controllable, etc.
The Polish Government has generally
approved the proposed Regulation, however,
discussion in the European Commission is
still pending.
The discussion concerning the in-
stitution which should be selected as an
independent body to monitor campaigning
process has not yet brought any results,
however, there is a general understanding
that such institution is needed. Currently
there is no clear candidate with certain
trust, capabilities and willingness to moni-
tor the campaign.
Overview of policy reform in political
spending and ads transparency in your
country
Implementation of the Regulation will
require a comprehensive approach to legis-
lation regulating the election process in
22 Members of management of some state owned companies have contributed (in a unified form and at the same time) to campaign funds of several
candidates of the ruling coalition, i.e./ Ludzie Orlenu płacili na kampanię Szydło. Fala oburzenia w sieci - Wiadomości (onet.pl)/ONET News.
Poland. Despite the fact that some reg-
ulations are already in place, i.e. need to
identify the sponsor of the political adver-
tisement or a need for political parties to
report any donation or contract on an on-
going basis, other solutions will have to be
correspond with the existing legal system.
This should include but not be limited, to
the following issues:
• identification or establishing an independ-
ent monitoring body with capacity
to execute new regulations,
• inclusion of on-line campaign into the
election process and adjustment of legal
provisions to new situation,
• need for a clear definition of the concept
of political advertisement published on
Internet advertisement platforms – one
that is coherent with political materials
being used offline,
• need to implement tools which provide
the access to necessary data from Inter-
net advertisement platforms,
• implementation of the requirement to
report campaign spending and income by
candidates, political parties and election
committees on an ongoing basis and in
an electronic format,
• inclusion of any third-party campaigning
and campaign financing into the main
campaign finance construct in order to
increase transparency and provide a tool
for comprehensive monitoring system,
• adjustment of court procedures to new
solutions and challenges related with
social media campaigning.
Policy recommendations
• Internet advertisement platforms shall
disclose and make easily accessible for
anyone interested all ads released by
political actors and on political matters
for a period of at least 6 years,
• Each political advertisement should in-
clude information on sources of funding,
• Internet advertisement platforms shall
verify the sponsorship of political cam-
paigns and display details about the
sponsor as part of the ads,
9
• On the EU territory, Internet advertise-
ment platforms should permit political
ads only if those are sponsored by entities
headquartered in the EU or international
organisations,
• Internet advertisement platforms should
provide means for automatic data pro-
cessing for monitoring institutions, NGOs
and researchers at minimal,
• Internet advertisement platforms should
recognize ongoing election processes and
require advertisers to declare in which
one they are campaigning,
• Internet advertisement platforms should
provide specific and clear reasons why an
ad has been presented to a user,
• Policies should not be limited to social
media only, but same policies implemented
for electronic advertisement channels
including in-game ads.
Hungary country
report
Media Environment in Hungary
Traditional media
As the state is the largest advertiser in the
media, the allocation of public advertising
has traditionally played a major role in the
market. The distribution of public advertis-
ing in Hungary can make newspapers profit-
able or unprofitable.
The media market has become in-
creasingly distorted recently. The Central
European Press and Media Foundation
(KESMA) set up by the government in 2018
owns and controls nearly 500 media outlets
‘voluntarily offered’ to KESMA by pro-gov-
ernment owners. Over the last few years,
the number of independent outlets has
decreased while the government has taken
control over the whole media at the local
level.
Since 2010 state advertisers favor
companies linked to the government, while
independent outlets are often ignored.
In 2020, 86% of state advertisements went
to pro-government owners.
Social media
The rules on political advertising do not spe-
cifically reflect advertising outside the tradi-
tional media. Neither the campaign financing
rules nor the powers of the control institu-
tions are specified for online political adver-
tising. Although the general nature of the law
would allow it, the State Audit Office and the
Hungarian State Treasury assigned to monitor
political financing interpret their powers nar-
rowly and do not dedicate capacity to assess
the costs of advertising in social media. As a
result, online political advertising is not even
as scrutinized as advertising in the traditional
media captured by the government.
A good example of the shortcomings
is the 2020 by-election campaign of Ms Zsófia
KONCZ. According to the candidate’s sub-
mitted report, she used 1 076 245 HUF state
campaign subsidies, and used an additional
3 504 365 HUF of her own funds for ‘mate-
rial expenses.’ As KONCZ did not declare
Facebook accounts in her state subsidies
(although this would be possible), she could
only finance his internet campaign from his
own resources. But in the case of KONCZ,
who built a 20+ thousand fan page during
the election campaign, her Facebook page
shows spending of 5.6 million, which exceeds
her own spending declared. Thus, it is likely
that KONCZ either did not fully report the
resources used or did not disclose the cost
of Facebook ads at all. This could be because
they were paid by someone else, which raises
the question of illicit campaign financing. It is
safe to say that the limit on campaign spend-
ing was exceeded by the candidate: one
million in spending (which does not include
an FB account) and the 5.6 million in Face-
book data alone are more than the amount
allowed under the Hungarian law.
Good and bad practices described
by local issues
Good practices
Regarding national elections, an act provides
that media outlets shall submit a price
list of its advertising services to the State
Audit Office within 5 working days of the
announcing the election date. The price
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list shall be registered and published on its
website. The press shall publish the same
price list on its website.
Although there are no laws governing
campaigning for local elections, it is common
practice for local newspapers to interview all
candidates during the campaign period.
Bad practices
The 2022 general election also saw a number
of deficiencies at local level. Mayors used
their office and the social media platforms
of the municipality to support and promote
a candidate or party. Local newspapers pub-
lished by the municipality were also used for
campaigning purposes, promoting a candi-
date or a party, e.g. by providing information
on local investments and developments
run by the governing party. These spending
influencing the election remained invisible to
the State Audit Office, despite the fact that
all of them were financed from public funds.
Status of the implementation
of the European regulation
The proposed Regulation on the transpar-
ency and targeting of political advertising
will require all member states to designate
one competent authority enjoying full
independence both from the sector and
from any external intervention or political
pressure.23 As the independence of Hun-
garian state agencies has generally been
compromised, it is doubtful whether the
designated contact authority can meet the
requirement of independence.
The broad definition of a political
actor brings GONGOs within the scope of
the Regulation, which is to be welcomed.
Until now, the campaigning activities of the
GONGOs have been completely invisible to
the state authorities. However, the scope
of the Regulation can also be used to place
administrative burdens on NGOs critical of
the government.
What is the compliance of the national
legislation with the EU framework
The Regulation will require the Hungarian
legislation to be amended comprehensively.
The most important consequences of the
Regulation will be that (1) online advertising
will clearly fall under the material scope of
political advertising, and it should therefore
be considered by public authorities as a plat-
form that influences political competition.
Another (2) significant development will be
the understanding of entities having impact
in politics (‘political actor’). This is a broader
term than the current Hungarian legislation,
which limits transparency rules only to can-
didates and parties in election campaigns.
The designated authority will also have the
power to issue fines to providers of political
advertising services, (3) which competence
will require a judicial remedy and therefore,
the amendment of law on court procedures.
Policy recommendations
Financing political parties
The real campaign expenditures of parties
should be estimated, and based on it, the
annual state funding for parties should be
redetermined.
At least a part of the state funding
should be adjusted to the value or number
of donations paid by individuals to the party,
while maximizing these amounts, to encour-
age parties to raise additional revenues and
strengthen their social embeddedness.
To prevent business interests from
buying into politics, the annual amount of
donations from a single donor should be
limited to a few million HUF.
The economic activities that parties
and their organizations might carry out should
be limited. Economic activities beyond those
related to the parties’ objectives (e.g. publi-
cations, dissemination of policies) should be
made transparent.
It should also be set by law that each
party has access to loans under the same
conditions.
Parties and their institutions (foun-
dations or companies run by the party)
should fall under the scope of freedom
of information act.
Parties should prepare annual reports
to be submitted to court in the same way
as organizations governed by private law.
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Reports should be audited by an independ-
ent auditor for any income above HUF 50
million. A list of donors above a threshold
should also be part of the report. Disclosure
is also required of the register of non-mon-
etary donations and the estimated value
above a threshold. Reports must also cover
the expenditure of the party’s parliamen-
tary group, the party foundation and the
company owned by the party.
Leaders of parties with a budget of
more than HUF 50 million but having no
parliamentary or municipal mandate should
also be subject to the same asset declaration
requirements as of MPs.
Parties should keep all their income
and expenditure in up-to-date transparent
bank accounts. Party organizations may keep
sub-accounts under the same conditions.
Details of all transactions, except personal
data, should be made publicly accessible.
Expenditure or incomes not appearing in
these accounts should be considered illegal.
Financing political advertising in general
The concepts of political advertising should
be principally redefined to cover all adver-
tising activities that are likely to influence
voter behavior or public policies, regardless
of the form of the medium.
Political advertisement on social
media should be subject to (national) laws
governing political advertising.
Financing campaign activities
Rules on general elections’ campaign financ-
ing should also be extended to municipal
elections, EU parliamentary elections and
national or local referendums, in particular
when they take place in the same period.
Registered media outlets should
provide free advertising opportunities of
equal quality and with a specified amount
of coverage to political parties during the
election campaign.
During the election campaign, candi-
dates and parties should be eligible to place
advertisements on public premises without
limitation, while they should be responsible
for their removal.
With the exceptions of dissemination
carried out by the bodies responsible for
the administration of elections, state and
municipal activities disseminating infor-
mation related to the campaign should be
prohibited during the election campaign.
Law should make clear that public
officials are not allowed to campaign on
their own or contribute to the campaigns of
others. If incumbent officials stand for elec-
tion as a candidate, they should keep the
public and candidate activities separate.
The amount spent by candidates and
parties on advertising during the campaign
should be limited to a few million HUFs.
During the campaign, the adver-
tisements of parties and disseminations
of public bodies, as well as the data of
advertisements promoted by third parties
(companies, CSOs) should be registered in
a transparency notice and in a searchable,
public online database run by the State
Audit Office. The disclosure should include
inter alia the name of advertiser, the spon-
sor, the price of an ad, the amount paid
for the ad, the publication period, a link
to the ad, the contact point.
Candidates should keep a public
campaign diary that includes events in
which the candidate participates, making
offline campaigning more transparent.
The diary should include programmes that
are not funded by a party or candidate but
are merely attended. Failure to disclose
information should result in sanctions.
Powers of the State Audit Office
should be clarified and its decisions should
be subject to a judicial review. Stricter con-
flict of interest rules for the SAO’s leader-
ship should apply to exclude former rep-
resentatives or leaders of a political party.
SAO should keep a public register of
the results of the procedures carried out
upon complaints. SAO should be required
to report on the results of its audits right
after the elections and to make recommen-
dations to the regulatory framework.