Closing of Investigation No VIZSG/10/2023 – “Remediation of the Szekszárd Lőtér Water Supply Area” and “Protection of the Southern Regional Water Supply Area of Szentendre”

In March 2023, the Integrity Authority (“Authority”) received a whistleblower report regarding two EU-funded projects for the protection of water supply areas. According to the report, the contractor may have modified the technical solution undertaken in the public procurement procedure during implementation, which may have influenced the implementation of the project and the conditions for public procurement competition. The Authority found the content of the report to be substantiated and launched an investigation into the responsible use of European Union funds.

The investigation concerned Project ID KEHOP-3.3.0-15-2016-00003, titled “Remediation of the Szekszárd Lőtér Water Supply Area”, totaling HUF 6.2 billion, as well as Project ID KEHOP-3.3.0-15-2021-00010, titled “Protection of the Southern Regional Water Supply Area of Szentendre”, worth a total of HUF 5.2 billion.

The objective of Call for Proposals ID KEHOP-3.3.0 was to assess contaminants left in underground waters and the geological medium, as well as to prepare remediation. Another objective of the call for proposals was to carry out the remediation of the contaminated areas.

According to the call for proposals, in projects involving remediation – such as the two investigated projects – it is necessary to define technical and professional outputs on the basis of which groundwaters and the geological medium in the affected areas are remediated to the target condition threshold.

During the investigation, the Authority reviewed the technical content of the remediation works, analysed the public procurement procedures, as well as contract modifications and the lawfulness of payments. 

The investigation found that the planned technical contents were substantially modified during the implementation of the projects. According to the independent experts involved in the procedure, the modifications can be considered professionally justified, and they were approved by the competent environmental protection authorities as well. However, it was established that in the investigated projects, remediation measures were implemented under less stringent conditions – by increasing the target threshold values and reducing the size of the intervention area – thereby giving rise to a suspicion of unlawful reduction in the technical content. For the purposes of assessing the legality of the performance and modification of the public procurement contracts, the Authority lodged a notification with the Public Procurement Authority, which subsequently launched an investigation to review the contracts. Although the Public Procurement Arbitration Board did not find any infringements regarding the contested technological modifications, it nevertheless initiated ex officio proceedings in both cases, following up on a contract review procedure initiated by the Authority, because of certain shortcomings in contract performance. As a result of the review procedures, a fine of HUF 2.5 million was imposed in each case on the contractor and the contracting authority, amounting to a total of HUF 5 million.

Based on the decisions of the Public Procurement Arbitration Board, the Managing Authority conducted irregularity proceedings and found that the beneficiary, the General Directorate of Water Management, had breached its fundamental obligation to ensure the responsible use of funds. As a result, it reclaimed HUF 50,780,950 in the case of Project ID KEHOP-3.3.0-15-2021-00010 and HUF 56,829,055 in the case of Project ID KEHOP-3.3.0-15-2016-00003 – totaling HUF 107,610,005 in funding – in line with the irregularity decisions that became definitive on 5 September 2025.

Furthermore, the Authority’s investigation found that the tasks relating to the maintenance obligation required in the Szekszárd projects were not performed, thereby giving rise to a suspicion of non-performance of the requirements set out in the call for proposals. 

The Integrity Authority requested the Managing Authority to conduct irregularity proceedings in connection with the Szekszárd project for shortcomings in fulfilling the maintenance obligation, and in both projects for the suspected reduction of the technical content.