A construction similar to an authority contract is not known in foreign law, and in the strict sense it has no precedent.1 The leading English-language handbook on Hungarian administrative law uses the term ‘administrative agreement’ to describe the term ‘authority contract’.2 An authority contract is the only contract that replaces a public act3 according to the article describing Administrative Agreement in the Internet Encyclopedia of Law/Legal Science (abbr. IJOTEN). Civil lawyers dealing with the issue partly consider the authority contract to be the narrowest category, a specific type of administrative agreement, arguing that an administrative contract does not qualify as an administrative contract from a private law perspective.4

“Section 92 (1) A legal provision may allow or require that the authority conclude a written public administration contract with the client instead of issuing a decision in order to resolve a matter within its jurisdiction in the public interest and in the interests of the client. The authority contract is an administrative contract.”7

The IJOTEN entry points out that instead of an authority contract, the public administration body could even make an administrative decision, but it considers a contractual solution to be more advantageous both from its own point of view and for the client. According to civil law criticism, however, this agreement does not comply with the terms of the contract in any way, because there is a hierarchical relationship between the parties (due to the imperium of the public administration, i.e. its authority to exercise public power). Thus, there is no (or a lesser degree of) freedom of contract, the authorities are not equivalent, and in essence, this is a dictate disguised as a bilateral act forced on a client. According to public lawyers, an authority contract is the ‘ultimate value’ of administrative agreements. However, an authority contract is also a contract, based on the joint determination of the parties, since the client can decide not to undertake the contents of the contract or not to agree with the conditions that the authority would include in the contract. In the authority contract, therefore, many typical private law requirements are not expressed (the freedom of choice of parties, the freedom of type and the freedom of content are all significantly limited). In the case of an authority contract, the authority usually stipulates conditions in the contract that are normally not included in an official decision. That is, it contains advantages for both parties, but to differring extent. In the authority contract, the subordination-superiority does not apply (however, this is possible in legal relations based on organisational nature or ownership). The superior nature of the authority is present in the legal relationship itself, given that in the event of the failure of the contract, the public administration may return to issuing a unilateral official act. The Civil Code states with regard to authority contracts that the rules of the Civil Code relating to contracts shall apply to issues not regulated therein.