The European Court of Human Rights (ECHR) recently adjudicated a Hungarian case that sheds light on the balance between the right to free speech and the enforcement of contractual confidentiality clauses. In Boronyák v. Hungary, the court’s ruling underscores the complex interaction between individual rights and contractual duties within the framework of Article 10 of the European Convention on Human Rights (the Convention), which protects freedom of expression.

Gergely Boronyák, an actor, entered into an agency contract with a production company Media Services and Support Trust Fund (Médiaszolgáltatás-támogató és Vagyonkezelő Alap, “MTVA”, a fund company owned and financed by the Hungarian State) to star in a television series funded by the state-owned entity. The contract included a stringent non-disclosure clause prohibiting the disclosure of confidential business information. When the series was terminated in 2012 due to low interest, Boronyák’s contract was also terminated. However, he later disclosed details about his remuneration in a media interview and during court proceedings related to a separate freedom-of-information lawsuit.

As a result, the production company sued Boronyák for breaching the confidentiality clause, seeking a penalty of HUF 10,000,000 (approximately EUR 26,000). The Hungarian courts upheld the company’s claim, and Boronyák’s subsequent appeals, including a constitutional complaint, were dismissed. He then took his case to the ECHR, arguing that the penalty violated his right to freedom of expression.

The ECHR’s analysis focused on whether the Hungarian courts had adequately protected Boronyák’s right to freedom of expression under Article 10 of the Convention while balancing it against the production company’s legitimate interest in maintaining business confidentiality. The court acknowledged that Boronyák had voluntarily entered into the contract, agreeing to the confidentiality clause. The Hungarian courts had determined that this obligation persisted even after the contract’s termination. Importantly, the ECHR noted that the national courts had considered the public interest aspect of the disclosed information, particularly given that it related to the expenditure of public funds.

The ECHR emphasized that while public interest in state budget expenditures is undeniable, the disclosure of such information should not automatically override contractual confidentiality obligations. The Hungarian courts found that the specific information Boronyák disclosed was not essential for public debate on state expenditure, as the public could access such data through other legal means, such as freedom-of-information requests, which had already been successfully used by the media outlet involved in this case. A critical aspect of the ECHR’s review was the proportionality of the penalty imposed on Boronyák. The court examined whether the fine was excessively punitive in relation to the breach and whether it struck a fair balance between the conflicting interests. The domestic courts had considered the significant breach of contractual obligations and the serious nature of the confidentiality breach, ultimately deeming the penalty appropriate.

The ECHR concluded that the Hungarian authorities had struck a fair balance between Boronyák’s freedom of expression and the production company’s right to protect its business confidentiality. The court held that the interference with Boronyák’s Article 10 rights was justified, as it was based on relevant and sufficient reasons, and fell within Hungary’s margin of appreciation.

This decision underscores that while freedom of expression is a fundamental right, it is not absolute and can be subject to restrictions, particularly when balanced against legitimate business interests protected by contractual agreements.

The inherent tension between non-disclosure agreements (NDAs) and free speech revolves around the limits of contractual freedom and the protection of fundamental rights. At the heart of this issue is the principle of “freedom of contract,” which asserts that individuals in a free society should be able to enter into agreements of their choosing with minimal external interference. This principle respects the autonomy of individuals to define their relationships and obligations according to their preferences and needs.  However, this freedom is not absolute and can come into conflict with the equally important principle of free speech. The right to express and disseminate information, particularly on matters of public concern, is a cornerstone of democratic societies. It ensures transparency, accountability, and the free flow of ideas essential for public discourse and the health of the democratic process.

This tension requires a delicate balance. On one hand, respecting the autonomy of individuals to freely enter into contracts is fundamental to personal liberty and economic efficiency. On the other hand, safeguarding the right to free speech ensures that private agreements do not undermine public interests and democratic values. Addressing this balance involves recognizing the legitimate purposes of NDAs, such as protecting privacy and business interests, while also ensuring that these agreements are not misused to stifle speech on issues of significant public interest. This requires careful consideration of the context in which NDAs are employed and the potential implications for broader societal values.

In this case, however, the social interest did not outweigh the business interests of the legal entity. The interview in question occurred concurrently with another legal process, during which the company’s public funding expenses had already been disclosed through court-mandated data sharing. As a result, the specific fees paid to the actor did not constitute information of such significant public interest that it would justify overriding the confidentiality agreement. Therefore, no violation of Article 10 of the Convention was established, as the disclosure did not serve a crucial public interest that would necessitate breaching the contractual obligations.

János Tamás Papp JD, PhD is an assistant professor at Pázmány Péter Catholic University, Hungary, and a legal expert at the Department of Online Platforms of the National Media and Infocommunications Authority of Hungary. He has taught civil and constitutional law since 2015 and became a founding member of the Media Law Research Group of the Department of Private Law. He earned his JD and PhD in Law at the Faculty of Law and Political Sciences of the Pázmány Péter Catholic University. His main research fields are freedom of speech, media law, and issues related to freedom of expression on online platforms. He has a number of publications regarding social media and the law, including a book titled „Regulation of Social Media Platforms in Protection of Democratic Discourses