Hungary’s rule of law and judicial independence face fresh scrutiny after prime minister Viktor Orbán’s government announced plans for a new court system and police shut down an investigation into a case linked to his son-in-law.

Since taking office in 2010, Mr Orbán has used his Fidesz party’s dominant position to focus power in the hands of loyalists and replace independent watchdogs with allies who oversee areas ranging from banking to justice to the media.

The government now plans to rush through a Bill to create new public administration courts under the authority of the justice minister, who will control their budgets and have the final say on the appointment of judges.

Officials insist the new system will not be subject to political meddling and will ease the workload on existing courts, while ensuring efficiency and professionalism in handling disputes over a wide range of government business.

“In itself, setting up public administration courts should not be worrying – but given the Hungarian government’s track record, there are lots of reasons to be concerned,” said Marta Pardavi, co-chair of the Hungarian Helsinki Committee.

“The main question is, who will decide on sensitive cases like tax issues, public procurement, civil liberties or elections, when the government is being sued? Who will take those decisions and how will they be appointed?” she added.

“Seeing how Hungarian public administration currently works, it is quite obvious that [those judges] would be loyal to the government.”

The government allowed only a few days for public consultation on the Bill and hopes to pass it swiftly, so that transitional reforms can be implemented next year ahead of the planned introduction of the courts in January 2020.

Hungary’s centre-left Democratic Coalition opposition party warned that the new courts would “ensure that lawsuits against the state would land in the appropriate place, and the Orbán regime would have the last say in the courts”.

EU scrutiny

Hungary already faces EU legal action over its treatment of refugees and migrants and its legislative attacks on civil society groups and the liberal Central European University in Budapest.

The country’s use of EU funds is also under examination, and earlier this year the European Anti-Fraud Office (Olaf) said it had uncovered “serious irregularities” and possible conflict of interest in street-lighting contracts for Hungarian towns.

Those partly EU-funded projects – worth tens of millions of euro – were implemented by a company called Elios, which at the time of the alleged wrongdoing was jointly run by Istvan Tiborcz, who is married to one of Mr Orbán’s daughters.

Hungarian police announced this week that they had closed down their investigation into the matter, having found no evidence that a crime was committed.

“The outcome of the Hungarian authorities investigations ... is surprising. The Olaf report contained strong evidence on fraudulent irregularities,” said Inge Graessle, head of the European Parliament’s budgetary control committee.

“The outcome leaves and strengthens doubts on the independence of Hungary’s law enforcement authorities and reinforces the need of a real tool to protect EU financial interests in future,” she added.