Hotel Association - Interest representation or putty union?

Sixteen years in the lobby of politics: what has MSZÉSZ given to the Hungarian hotel industry?

The Hungarian hotel industry needs strong advocacy, perhaps more than ever. The state has made the MSZÉSZ a regulator, data collector, supporter, market shaper and, in a sense, an indirect provider of ownership interests.

In this system, an organization that not only has access to decision-makers but can also engage in conflict with them if necessary would be particularly important for independent hotels, rural businesses, smaller operators, and market players without political connections.

The MSZÉSZ represents more than 650 members, approximately 480 hotels and more than 42 thousand hotel rooms, its membership covers approximately 70 percent of the domestic hotel capacity. This is not an insignificant professional club, but in principle should be one of the strongest domestic sectoral interest advocacy organizations, therefore, after sixteen years, one cannot be satisfied with the fact that there are general assemblies, regional meetings, award ceremonies, conferences, analyses and protocol meetings, but whose interests did it represent, with what effectiveness and with what degree of independence .

This is where the more unpleasant part of the story begins, which did not begin with Zoltán Somlyai.

Zoltán Somlyai became the president of the MSZÉSZ on January 1, 2025. He had no opponent: all seven regions of the association supported him. At the time of his election, he headed the hotel division of BDPST Hotel Management, which belongs to the business interests of István Tiborcz. The press also covered his appointment intensively because he had previously worked in the management of the Kempinski Hotel Corvinus when Ráhel Orbán began her professional career at the hotel.

This goes without saying: the Hungarian Hotel Association has been headed by a manager who manages the hotel interests of the Prime Minister's son-in-law. This does not call into question Somlyai's professional competence. He has a long managerial history in the hotel industry. But when it comes to the president of an interest group, it is not only professional competence that counts. Equally important are independence, the management of conflicts of interest and the ability of the president to represent the membership against his own employer's ownership group or its political network, if necessary.

Was it realistic to expect the head of BDPST Hotel Management to openly criticize NER's rise in the hotel market, the distribution of state funds, the political dependence of the tourism institutional system, or the competition-distorting effect of relationship capital?

We are not claiming that he received instructions. It is not necessary to claim this. Conflicts of interest exist even without instructions. It is already a credibility problem if the membership can rightly ask the question: how far does the president have the freedom to engage in conflict, if his own leadership position is tied to the same economic circle that he should be criticizing in a given case?

Somlyai resigned from his position as president in May 2026. The brief statement released to the public recorded the fact of his departure, without a detailed professional or organizational explanation.

But the problem didn't start with him, and it wasn't solved with his departure.

The business connections of the previous president, Tamás Flesch, did not strengthen the appearance of independence either.

Before Zoltán Somlyai, Tamás Flesch led the association for several terms. Tamás Flesch is the co-owner and managing director of the Continental Group. The Continental Group did not only operate hotels that were owned by it or with a politically neutral background. Its portfolio includes, among others, the Hotel Moments Budapest on Andrássy Avenue, which is considered one of the best in the world and whose ownership background included interests from Sándor Csányi, István Garancsi and Zsolt Hernádi, but also interests from Norbert Szivek and Zsolt Komonczi.

Hotel Moments is a successful hotel project, and Continental is a professionally recognized Hungarian hotel operator. The problem is that the president of the MSZÉSZ was operating the hotel assets of a business circle whose members are key players in the Hungarian political and economic system after 2010.

Sándor Csányi cannot simply be placed in the same political category as an average NER entrepreneur, nor can the political and state connections of Zsolt Hernádi and István Garancsi. However, the common point is clear: we are not talking about vulnerable independent hotel owners far from the power center of the Hungarian economy, but about actors with extremely strong economic and political interest-assertion capabilities.

Therefore, it would be misleading to present the election of Zoltán Somlyai as some kind of sudden NER turnaround. The presence of hotel operators connected to politically embedded ownership circles was already a given during the previous leadership. With Somlyai's appointment, this connection has at most become more direct, clearer, and more difficult to explain.

Who led the alliance before?

The presidential timeline can be accurately reconstructed from the MSZÉSZ's own yearbook. Dr. János Erdei, Andrea Kopócsy, dr. Ákos Niklai, László Könnyid, Tamás Flesch, Csaba Baldauf, and then Tamás Flesch again led the organization. Zoltán Somlyai took over the presidency at the beginning of 2025.

Of course, this does not mean that all presidents should be treated as representatives of the NER, on the contrary: the list of leaders includes hoteliers with long and recognized professional careers, coming from different ownership and institutional backgrounds. It is not that the post of president of the MSZÉSZ has been an extended arm of a government-affiliated enterprise without interruption since 2010. The change occurred gradually: in parallel with the increasing presence of the state and politically embedded economic groups in the hotel market, those professionals whose business careers were connected to this institutional system or ownership circle also appeared more and more prominently in the leadership of the association.

This is not a simple personal issue. It is the imprint of the power structure of Hungarian tourism.

László Könnyid was also the president of MSZÉSZ, but later he became one of the key leaders of the state tourism management, not a hotel industry enterprise, but directly. He joined the board of directors of the Hungarian Tourism Agency, then took over the management of the Hungarian Tourism Quality Certification Board and subsequently worked as the CEO of the MTÜ from the beginning of 2024 to July 2025. It can be considered logical that a professional who is well-versed in the hotel industry and interest representation operations would be placed in the state tourism management.

However, we rightly wonder, if the former president of the advocacy organization will soon become the head of the state structure that regulates the sector, collects data, operates a rating system, and prepares development policy decisions, then where is the line drawn between advocacy and state tourism management?

Who represents the hoteliers against the state in this system, if personal passage is so natural between the two sides?

The hotel association should function as a counterpoint to state tourism management. In comparison, personal career paths show that there is not a wall but a revolving door between the two institutional worlds.

On one side of the system, someone negotiates with the state on behalf of the membership. A few years later, they can negotiate with the same membership on behalf of the state.

This is not necessarily corruption. It is not necessarily a political directive. But it is definitely a structural conflict of interest risk that a credible advocacy organization should address openly and in a regulated manner.

The phenomenon does not only appear in presidential positions. For example, Gábor Maráczi was an active player in the professional and management bodies of the MSZÉSZ for a long time. According to current organizational data, he is a member of the board of directors, and previously worked at the Hungarian Tourism Company. In May 2026, he joined Hunguest as portfolio development manager.

Hunguest is not simply one of the country's major hotel chains. The company is owned by Lőrinc Mészáros and its hotel developments have received significant state subsidies in recent years. This does not make Gábor Maráczi's professional qualifications questionable. Hunguest clearly needs an experienced portfolio development manager, and a professional has the right to accept a good management offer.

How credible can an alliance be if one of its leaders is the head of a hotel group that is one of the largest beneficiaries of state tourism development subsidies and whose owner is the most influential figure in the political-economic system?

And who represents the interests of those independent hotels that did not receive nearly 18 billion forints in development support, yet compete in the same labor market, for the same guests, and often in the same destination?

The fact that the MSZÉSZ boards include managers of large hotel companies is not a problem in itself, as a sectoral association needs the experience of large market players, but if, alongside the representation of large and politically embedded companies, the voice of independent, unconnected hotels operating solely on a market basis is not heard with the same force, it can lead to disproportions and loss of credibility.

Not a single person, but a closed professional circle

The same names, companies, and institutions have been appearing over and over again in Hungarian tourism for many years.

Someone will be a hotel manager one year, a member of the MSZÉSZ board of directors the next, later its president or vice president, then the head of the MTÜ, the certification body or one of the large hotel groups. Others simultaneously hold federal positions and represent the largest companies in the market.

Each career step on its own can be explained by professional experience. However, together they form a closed system.

In this system, the same narrow professional elite:

• leads the largest hotel groups;

• manages advocacy;

• participates in state tourism management;

• contributes to the operation of the rating system;

• advises the government;

• then it also appears as the executor or beneficiary of government decisions.

This personal visit does not necessarily prove a violation of the law. However, it shows why it is difficult to consider the MSZÉSZ as an interest group clearly separate from politics, state tourism management, and the largest ownership groups.

The problem is not that the players know each other. In a small market, this is inevitable.

The problem is when there is no one left to ask from the outside.

Who would have represented the independent hotels?

The ownership map of the Hungarian hotel market has changed significantly in the past sixteen years. Politically well-connected business circles have built up substantial hotel portfolios. Significant state subsidies have been received for developments, new capacities have appeared, and state tourism management has gained greater influence over the sector than ever before.

In this situation, an independent professional organization would have been needed that would consistently ask:

• According to what professional criteria were the grants distributed?

• What impact assessments preceded the creation of new capacities?

• Didn't the fact that some ownership groups received significant public financial assistance beyond market opportunities distort competition?

• How can hotels be protected that are trying to stay afloat without any relationship benefits, relying on equity, bank loans, and daily market work?

The MSZÉSZ should not have been expected to behave like a political party. It should not have been at constant war with the government either. However, it should have been expected to publicly and verifiably represent competitive neutrality, a transparent support system, and professional operations independent of political connections.

In comparison, it is difficult to recall a conflict that the MSZÉSZ consistently pursued that received such widespread publicity, in which the organization took decisive action against the expansion of the NER hotel market, the concentration of the support system, or the lack of transparency in state tourism management.

There may have been background negotiations. There may have been criticisms made behind closed doors. There may have been effective lobbying by the leaders of the association on a number of detailed issues. However, the credibility of a national advocacy organization cannot be built solely on undocumented background discussions.

Mandatory certification cannot be considered an absolutely independent system either.

One of the regularly mentioned professional achievements of the MSZÉSZ is the introduction and operation of the Hotelstars system in Hungary. The harmonized European system of requirements is a value in itself: it has brought about more comparable categories, more uniform criteria and a more professionally organized classification.

However, the professional usefulness of the system does not automatically imply its institutional independence.

In the Hungarian model, certification is no longer simply a voluntary professional trademark. The certification of accommodation facilities is mandatory by law, and the Hungarian Tourism Quality Certification Body appointed by the government is authorized to perform the task.

The system cannot be considered independent in an absolute sense when the state, interest representation, professional rulemaking, and market actors are interconnected in the same narrow institutional space.

In a truly independent rating system, there would be a clear and verifiable separation between the advocacy, the requirements setter, the auditor, the decision-making body and the appeals forum. It would be publicly visible who appoints the raters, what conflict of interest rules apply to them, what their relationship is with the hotels they are assessing, how the appeals process works, and who monitors the rating body itself.

The question is not whether there is a need for rating. There is. The question is who qualifies, from whom they receive their authority, to whom they are accountable, and how independent they are from the actors whose market positions they decide on .

What has MSZÉSZ achieved?

The MSZÉSZ is of course not an idle organization. It organizes professional events, publishes analyses, operates its regional and professional communities, represents Hungary in international organizations, manages sustainability programs and transmits information to its membership - however, a significant part of these are not the result of advocacy, but rather a membership service.

Organizing a conference is not the same as changing a law. A ministerial presentation does not prove the success of the lobby. A joint photo is not a statement of results. The fact that leaders have access to government actors does not mean that they can enforce the interests of the membership against them.

The most important results regularly include the 5 percent accommodation VAT, the introduction of Hotelstars, professional analyses and various crisis management proposals. Several of these were indeed beneficial for the sector. However, the MSZÉSZ does not present in a clear, annual and accountable form what exactly was its own initiative in each decision, what the government accepted, what it did not, and what compromises had to be made.

There is no easily understandable annual lobbying balance sheet. There is no public list of results. There is no failure report. There is no table from which the hundreds of members could see exactly what regulatory or economic results were achieved for the membership fee they paid. Yet an interest representation should report not only on its successes, but also on its failures.

Why do many people call it a putty joint?

The term “squad” comes from Ferenc Molnár’s novel The Boys of Pál Street , where the boys operate an association with serious rules, positions and meetings that actually has no substantive purpose or results. The analogy fits the MSZÉSZ because while it apparently operates, deliberates, answers and communicates, it is still unclear to many what tangible interest representation results it has achieved for the benefit of the Hungarian hotel industry as a whole.

In the case of MSZÉSZ, this feeling is reinforced by several circumstances:

• The organization represents enormous market power, yet few strategic breakthroughs can be named that can be clearly and documentedly linked to it.

• For a long time, its leaders came from a circle of hotel operators that were commercially connected to key players in the political and economic elite.

• Its former president became the head of the state tourism management and certification system.

• A key member of the board of directors and the supervisory board took on a management position at Lőrinc Mészáros' hotel group.

• In the alliance's communication, cooperation, dialogue and partnership are much more visible than conflict, accountability or public criticism.

• It played an important role in the professional operation of the rating system, while issues related to the institutional independence of the system and the appearance of conflicts of interest did not receive sufficient publicity.

• The membership does not receive a public, itemized accounting that would clearly show what the association has achieved, what it has not achieved, and why.

This does not prove that the MSZÉSZ acted on political instructions. But it strongly suggests that in recent years it has consistently considered maintaining good relations with politics more important than engaging in public conflict .

Can the MSZÉSZ be renewed?

The professional knowledge, international network and membership of the MSZÉSZ are assets worth building on. However, renewal does not mean a new image or new committees, but a real change in structure and approach.

This is based on full transparency of the business and ownership interests of managers, real electoral competition for renewals, institutional separation of interest representation and the mandatory qualification system, and public accounting of annual interest representation goals and results. It would be equally important that smaller, independent hotels are not only formally present in decision-making, and that the association also undertakes public conflict when competitive neutrality or the interests of the sector are violated.

If this does not happen, the MSZÉSZ will probably not cease to exist, but will gradually lose its credibility. It may continue to operate formally, but fewer and fewer people will believe that it truly represents the interests of the entire Hungarian hotel industry.

The hotel association should not be abolished, but rather restored to its true role

The Hungarian hotel industry needs not less, but stronger, more independent and more accountable interest representation.

The professional preparedness of the leaders of the past sixteen years is unquestionable. The question is whether an organization whose leadership was so closely linked to state tourism management and the most influential market players was able to represent the interests of all its members with the same consistency.

If the membership and the profession do not receive a clear answer to this, then the "putty club" analogy is not merely an insulting epithet, but a criticism of the lack of credibility.

The real challenge for the MSZÉSZ is therefore not dissolution, but renewal. It must decide whether it primarily wants to be a convenient professional partner of the current power, or an independent, critical and consistent representative of the interests of the Hungarian hotel industry. The two are unlikely to coexist in the long term.

About the author:

Tamás Pakuts has been actively involved in aviation and tourism for almost 35 years, and in the hotel industry and catering for more than 25 years.

As a manager and consultant, he had insight into the operations of several airlines, as well as hotels, hotel chains, and shipping companies, successfully taking on a role in their operational management, crisis management, and development.

He is currently present in many countries around the world with his colleagues as an expert, consultant, and trainer in the hotel industry and aviation, and he and his colleagues are working on the development of numerous new, internationally noteworthy projects.