Soros, the Hungarian-born US investor and philanthropist set up the Central European University (CEU) in his native Budapest in 1991, but it was forced to largely move to Vienna in 2019 after falling foul of the new law.
“The conditions introduced by Hungary to enable foreign higher education institutions to carry out their activities in its territory are incompatible with EU law,” the European Court of Justice said.
The National Higher education law was written to regulate all international higher eduction institutions, but was widely seen as an attack on the CEU by Prime Minister Viktor Orban.
Soros, who stepped down as chairman of the university’s board in 2007, also supports civil society and pro-democracy initiatives critical of Orban’s conservative and increasingly authoritarian government.
The European Commission took Hungary to court over the law and Tuesday’s judgement ruled that Hungary had failed to respect its commitments to the World Trade Organisation.
In particular, Budapest should not have discriminated against colleges such as the CEU by demanding that they offer the same degree courses in their state of origin — in this case the US — as in Hungary.
And it should not have required an international education treaty to have been signed between Hungary and the country in which the college was founded.
“That requirement is also contrary to the provisions of the Charter of Fundamental Rights of the European Union relating to academic freedom,” the ruling said.
It was not immediately clear whether the ruling would allow the university to move some of its operations back into Hungary, one year after it found it was impossible to continue operating there.
The college, registered in the US state of New York, and providing American-recognised degrees, educated a generation of Hungary’s post-communist elite.
But Orban’s camp saw it as a centre of liberal resistance to his hardline conservative rule.
Soros, who is Jewish, has become a hate figure for conspiracy theorists around the world in recent years and Orban’s government has accused him of plotting to flood Hungary with Muslim immigrants.
The Hungarian ruling Fidesz party and allied pro-government media regularly accuse the 90-year-old investor of working with EU officials in unproven plots against Hungary’s national interest.
With Hungary seen as having begun a slide into authoritarianism under Orban, Brussels has launched a so-called “Article 7” procedure probing whether Hungary is undermining democratic values.
The European Parliament and some member states are pushing to make payments from the EU budget, of which Hungary is a net recipient, contingent on Budapest fully respecting the rule of law.
And last week, a major annual EU report found that, in Hungary, “deficient independent control mechanisms and tight interconnections between politics and certain national businesses are conducive to corruption”.
Orban is furiously resisting calls for the budget to be linked to rule of law concerns and with Poland has threatened to block a huge post-coronavirus rescue package seen as vital to the EU economy.
And he has demanded the resignation of Vera Jourova, one of the EU’s vice-presidents, after she quipped that, rather than a self-described “illiberal democracy” Orban had created an “ill democracy”.