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Arbitration
Austria
The Vienna International Arbitral Centre recently initiated a comprehensive review process aimed at modernising, overhauling and streamlining its rules. The process included a widely distributed user survey, a number of discussion rounds and a roadshow. The process is finally nearing completion and the centre is preparing to release the revisions publicly.
The Supreme Court recently clarified the relationship between state immunity and enforcement of an arbitral award in a case concerning art loaned by the Czech Republic to a Vienna museum for an exhibition. The Czech Republic argued that the works of art under dispute were cultural objects serving the country's sovereign aims, and thus exempt from enforcement proceedings. The Supreme Court rejected this defence.
The Supreme Court was recently faced with an inexecutable arbitration clause and clarified the interpretation of arbitration agreements and their boundaries. The court held that arbitration agreements must be interpreted primarily under procedural law; if an agreement refers to an arbitral institution which no longer exists, the agreement becomes inoperative only if it is impossible to reconstruct a comparable arbitration court.
The Vienna Commercial Court recently refused to set aside an arbitral award issued by a United Nations Commission on International Trade Law tribunal seated in Vienna that had awarded Danish-Polish Telecommunications Group €400 million against Telekomunikacja Polska. The court's decision is in line with the trend of Austrian case law to uphold arbitral awards.
The Supreme Court recently handed down a decision relating to the arbitrability of shareholder disputes in which it generally confirmed their arbitrability, but declared them to be subject to certain criteria. The decision is in line with the general approach to uphold arbitral awards taken by the Supreme Court since the introduction of the arbitration law. In fact, only in rare cases has the court set aside arbitral awards.
Commercial Property
Austria
Overview
Including: Real Property Law; Tenancy Law; Real Estate Investment Funds Act.
Parliament recently introduced the Act on Late Payment, implementing the new EU directive on the same topic. The act aims to improve payment behaviour by introducing new due dates and increased interest rates. The act introduces new payment dates for rent agreements, depending on the type of property and parties involved, while taking into account the needs of tenants.
In light of a Constitutional Court decision, Parliament recently passed a bill amending the provisions on the Land Register registration fee. As of January 1 2013, the fee for all types of property acquisition is generally calculated on the basis of the fair market value of the real estate. The amendments have a considerable impact on ancillary costs of such acquisitions.
The Act on the Presentation of Energy Performance Certificates 2012 implements the EU Energy Performance Directive, which replaced EU Directive 2002/91/EC. The act introduces disclosure requirements for advertisements in commercial media, more stringent sellers' and landlords' obligations in relation to energy performance certificates and an effective regime of administrative penalties.
Parliament recently passed the Fiscal Stability Act 2012, introducing a number of measures intended to consolidate the budget. As these measures, among other things, introduce new taxes or increase existing taxes on real estate transactions, the act has sparked a huge outcry by the industry and will have a significant impact on the Austrian real estate market.
Real estate investors are increasingly renting out fully furnished apartments to tourists or business travellers for short periods. While short-term leases are highly attractive to respective lessors, owners of neighbouring apartments within a complex are usually not fond of such agreements, due to the high turnover of guests. The Supreme Court recently dealt with cease and desist proceedings instituted by apartment owners.
The Constitutional Court recently declared unconstitutional an article of the Court Fee Act, under which the fee for the registration of a new owner in the Land Register by reason of a deed of gift is taxed on the basis of the tax value. Although this judgment concerns court fees only, it calls into question all occasions where property transactions are taxed on the basis of the tax value rather than the market value.
E-commerce
Austria
Overview
Including: Consumer Protection Act; Spamming; Digital Signatures Act.
In a conflict between a domain name and another person's trademark the content of the domain is key. In a recent decision the Supreme Court had to decide whether to apply the same principle if the conflict is between a domain name and another person's name.
Employment & Labour
Austria
The Supreme Court recently clarified a conceptual question concerning age discrimination. The case was unique in that the plaintiff was the only contender for the job and the vacancy was never filled. The court had to decide whether discrimination could occur even in the absence of a person with whom the applicant's situation could be compared.
Employers must respond quickly when defending employees against mobbing attacks and harassment by their peers, a recent Supreme Court decision has confirmed. The court made clear that although an employer is free to choose any means necessary to protect its employees against such behaviour in the workplace, measures must be taken without delay.
Although Austria has had a statutory framework in place since 1988 regulating the relationship between temporary workers, their employers and the entity to which they are assigned, the legislature was slow to implement the regulations set forth in the EU Directive on Temporary Agency Work. In order to adopt the directive's provisions, the Temporary Employment Act will shortly be amended accordingly and signed into law.
Confidence in occupational retirement schemes has been lost over the years due to financial crises current and past, incorrect investment decisions and lax oversight. Many employees transferred their pension rights to defined contribution models hoping for higher returns, but instead suffered losses. The recent amendment of the Pension Fund Act aims to mitigate potential negative effects on occupational pensions.
Austrian law requires companies to be members of the Chamber of Commerce. In general, the applicability of a collective bargaining agreement is determined through mandatory membership of the relevant division of the Chamber of Commerce; the division to which a company belongs depends on the employer's trade/business and corresponding business licence.
In two recent decisions the Supreme Court clarified employer liability for harassment perpetrated by employees. The decision demonstrates that sexual harassment by the employer can also be perpetrated by the victim's superior. In such case the employer will be (vicariously) liable even where the harassment was the first such conduct of its kind.
Environment
Austria
When industrial property is sold and transferred, the parties usually agree on what environmental liabilities are assumed by which party. However, under mandatory public laws the seller remains liable for certain environmental obligations and the buyer becomes liable for other environmental obligations, irrespective of contractual provisions to the contrary.
Insolvency & Restructuring
Austria
For a successful rescue to take place, the business premises must remain available for the continued operation of the company. Consequently, Section 12c of the Insolvency Code protects the debtor from eviction in rescue proceedings. However, the Supreme Court recently confirmed that a landlord may proceed with eviction proceedings if the tenant fails to meet certain obligations.
A recent judgment of the Supreme Court made clear that future damage of an unknown amount arising from an event that occurred before the opening of insolvency proceedings may be asserted only as a bankruptcy claim in the insolvency proceedings. The estimated amount of damage must be disclosed when the claim is asserted against the bankrupt company.
A new real estate income tax was recently introduced in Austria. When land encumbered by liens is now sold in the course of insolvencies, the question arises as to whether this new tax qualifies as special estate costs. The Supreme Court is yet to clarify the matter; therefore, until this happens, creditors should note that reduced amounts will be attributed to them from the proceeds from the sale of collateral.
In 2009 the Austrian legislature abolished free legal aid for legal entities, and thus also for insolvency estates without assets, although free legal aid had previously been granted only under very restricted conditions. However, a recent ruling of the Constitutional Court held that the abolition of the entitlement to free legal aid for legal entities (ie, also for insolvency estates) was incompatible with constitutional law.
The Supreme Court recently clarified its position on whether injured persons could also join criminal proceedings as private parties if the offender has filed for insolvency. It ruled that creditors may join criminal proceedings as private parties in such cases only if the claims result from the prosecuted criminal action, arose after insolvency proceedings were opened and are not affected by the effects of the insolvency proceedings.
Company pension commitments to employees should be secured in case of the employer's insolvency. If (contrary to legal requirements) such pension securities are not held separately from the employer's other securities, the statutory pledge for securing company pensions cannot fulfil the hedging purpose prescribed by law. Therefore, if the employer acts unlawfully, the security mechanism prescribed by law is to no avail.
Intellectual Property
Austria
Overview
Including: Patents; Registered designs; Semiconductor protection; Trademarks; Design protection; Copyright.
In a recent decision the Supreme Court upheld the position of a collecting society claiming copyright infringement, ruling that the interests of an author to receive remuneration for the use of its work have greater weight than the interests of practising a trade. The court's decision is in accordance with the prevalent German doctrine on the subject concerning the monopolistic position and the obligation to contract.
In a recent decision the Austrian Supreme Court thoroughly examined the legal effects of a supplementary protection certificate for medicinal products and its interrelation with patent rights. The decision is complex, but provides valuable information on related proceedings for injunctive relief. Additionally, the detailed examination of legal aspects of supplementary protection certificates is welcome.
The Supreme Court recently clarified the applicability of Article 12(c) of the Community Trademark Regulation in the context of comparative advertising, ruling that it should be interpreted narrowly and must be employed only in cases where such usage is the only possibility for providing the public with comprehensive information on the marketed goods.
In a recent decision the Supreme Court evaluated the scope of patent protection of so-called 'Swiss-type claims' and infringements constituted by dietary supplements, thereby interpreting the European Patent Convention on a national level. A Swiss-type claim is intended to cover subsequent medical use (or indication of efficacy) of a known substance or composition.
The latest amendment to the Trademark Act grants trademark proprietors the right to submit a notice of opposition against registered trademarks. Previously, a proprietor had to wait for a trademark to be registered before it could challenge the lawfulness of the registration. By implementing opposition proceedings, the legislature also introduced a legal remedy to cancel a trademark registration retroactively.
The Patent Act provides for regulations with respect to employee inventions. Thus, employees (if they are not specifically employed for the purpose of making inventions) are entitled to adequate compensation if the invention or any right to use the invention is transferred to the employer. In a recent case the Supreme Court confirmed its view on the validity of flat-rate compensation agreements for employee inventions.
Media & Entertainment
Austria
The Supreme Court recently dealt with the conflicting interests of a media enterprise claiming freedom of expression and the IP rights of a minor portrayed in a photograph which was published out of context without his prior permission. The court once again took the opportunity to clarify its view on the permissibility of parody and social satire.
