"The Foundations will pursue all available legal avenues to defend the fundamental rights that are threatened by the legislation", OSF said in the statement, vowing to continue the organisation's work in Hungary through funding from the German capital.
"The government of Hungary has denigrated and misrepresented our work and repressed civil society for the sake of political gain, using tactics unprecedented in the history of the European Union". He cited Prime Minister Viktor Orban's landslide reelection in April as giving the government a mandate for a stronger law.
A Hungarian government billboard featuring George Soros, with the words translated to "Don't let George Soros have the last laugh" is seen at a transit stop in Budapest on July 6, 2017.
Mr Soros denies Mr Orban's accusation that his foundation is part of a plan to bring unsustainable numbers of migrants to Europe.
The foundation supports and funds democracy and civil society initiatives in more than 100 countries worldwide.
The nationalist leader ploughed tens of millions of euro in taxpayers' money into an anti-Soros media campaign that critics called anti-Semitic, and he said on Monday that the Stop Soros law is a top priority. It would also impose a 25 percent tax on foreign donations to NGOs that back migration.
Orban's Fidesz also ran an anti-immigrant billboard campaign, underwritten by the Hungarian government, which showed a picture of Soros laughing alongside the words, "Let's not leave Soros the last laugh".
The prestigious Soros-founded Central European University (CEU) is also waging a battle against Orban after a higher education law was passed past year that it says threatens its survival in Hungary.