We would like to ensure that you are still receiving content that you find useful – please confirm that you would like to continue to receive ILO newsletters.
30 January 2009
The primary aims of the EU Energy Performance of Buildings Directive (2002/91/EC) are to reduce energy consumption and carbon dioxide emissions and to comply with the Kyoto Protocol. Austria implemented the directive by passing the Act on the Presentation of Energy Performance Certificates, which became fully effective on January 1 2009.
This update outlines the circumstances in which an energy performance certificate (EPC) must be produced and examines the consequences of violations of the act under Austrian law.
The directive provides that when a building or apartment is sold or rented out, an EPC must be made available by the owner of the building to the prospective buyer or tenant. The directive does not define these terms in any further detail.
The act also does not define the term 'sale', but states that it includes any agreement on the acquisition of ownership in a building which, at the time of concluding the agreement, is yet to be constructed or refurbished. The explanatory note to the act states that the term 'sale of a building' must be construed in accordance with the EU directive rather than national law. Therefore, according to the explanatory note, any agreement on the acquisition of ownership for remuneration is covered by the act, including the exchange of buildings.
Likewise, the act does not define the term 'rent', but the explanatory note states that leasing agreements are covered by the act, whereas short-term rent agreements in the tourism industry (eg, holiday or hotel room rentals) are not covered.
From the explanatory note, it is clear that a straightforward purchase agreement or a straightforward rental agreement is covered by the act, whereas apparently a gift contract is not covered. It remains unclear whether more complex transactions also fall within the scope of the act. Nevertheless, more common transactions are regulated as follows:
Austria has chosen not to impose penalties for violation of the duty to produce an EPC, but rather to leave it up to the market to ensure that EPCs are used. This approach will work only if contractual law provides prospective recipients of EPCs with adequate remedies.
The act states that an EPC must be produced in certain cases. If the seller or landlord fails to produce an EPC, it is deemed to warrant an average energy performance corresponding to the type and age of the building. These provisions are mandatory.
The act does not lay down consequences if the seller or landlord makes an EPC available. Under principles of contract law, generally the seller or landlord warrants that the information contained in the EPC is correct. In consumer contracts this warranty is mandatory and cannot be excluded by the parties. If the seller or landlord does not provide an EPC and the building is less energy efficient than an average building of the same type and age, or if it turns out that the EPC is incorrect, the buyer or tenant may avail itself of the following remedies:
When enforcing these claims, the buyer or tenant will likely face the following practical problems:
The buyer or tenant will largely have to rely on expert opinions when filing a claim.
The act does not answer the question of who will bear the cost of the EPC. Parliament is expected to pass an additional bill in this regard in the course of 2009.
It is likely that sellers and landlords outside consumer contracts will make the EPC available to buyers and tenants, but subsequently exclude any liability for the EPC in the agreement. Therefore, in commercial transactions the EPC will have few legal consequences.
In consumer agreements where the energy performance of the building in question is above average, the seller or landlord may wish to use the EPC as a marketing tool. However, the seller or landlord will bear in mind that by the same token, the yardstick for the warranties regarding the consumer is increased and therefore will think twice before handing over the EPC. If, on the other hand, the energy performance of the building in question is below average, the seller or landlord will likely make an EPC available in order to avoid liability.
A buyer or tenant wishing to enforce a claim based on the act faces the practical problem of assessing how the poor energy performance has reduced the building's value. Therefore, the EPC is a good instrument to create awareness, but a bad instrument on which to base a lawsuit.
For further information on this topic please contact Nikolaus Pitkowitz or Martin Foerster at Graf & Pitkowitz Rechtsanwälte GmbH by telephone (+43 1 401 17 0) or by fax (+43 1 401 17 40) or by email (email@example.com or firstname.lastname@example.org). The Graf & Pitkowitz Rechtsanwälte GmbH website can be accessed at www.gmp.at.
The materials contained on this website are for general information purposes only and are subject to the disclaimer.
ILO is a premium online legal update service for major companies and law firms worldwide. In-house corporate counsel and other users of legal services, as well as law firm partners, qualify for a free subscription.