Austria updates

Employment & Benefits

Contributed by Graf & Pitkowitz Rechtsanwalte GmbH
Supreme Court on hairstyles and discrimination
  • Austria
  • 08 May 2019

An employee recently sued for damages and compensation for gender discrimination when his job application was rejected because he had long hair. Originally unsuccessful, when the employee learned that the defendant's employee handbook contained rules on employees' outer appearance, he sued again and succeeded, as the Supreme Court found that the employee handbook was prima facie evidence of gender discrimination.

ECJ rules on Austria's Good Friday dilemma
  • Austria
  • 27 February 2019

The European Court of Justice advocate general recently confirmed that the Austrian regulation which sets out that Good Friday is a paid public holiday only for members of four specific churches is discriminatory. Further, the advocate general concluded that each affected employee could claim holiday pay for past periods, unless such claims were already time barred, in which case claims could be brought against the Austrian state.

Strikes and right to strike
  • Austria
  • 12 December 2018

It is widely understood that the Austrian concept of 'social partnership' (ie, the system for cooperation between the two sides of industry) has largely contributed to peaceful industrial relations. The social partnership recently agreed on a new collective bargaining agreement for the metal industry. However, negotiations in several other trades and industries have followed, and in a less constructive atmosphere, further strikes may be forthcoming.

Good Friday and direct discrimination on religious grounds
  • Austria
  • 03 October 2018

Under Austrian law, Good Friday is a paid public holiday only for members of four churches. An employee who belonged to none of these churches took issue with this and sued his employer. The case eventually reached the Supreme Court, which requested a preliminary ruling by the European Court of Justice (ECJ). In his recently issued opinion, the ECJ advocate general delivered what will likely also constitute the court's position on the matter.

Parliament passes new Working Time Act
  • Austria
  • 18 July 2018

Parliament recently passed a new law that brings sweeping changes to the Working Time Act and will come into effect on 1 September 2018. The law – which was heavily debated in the media and caused much controversy among the 'social partnership' (the Austrian system for cooperation between the two sides of industry) – sets the stage for more flexibility in a changing work environment.


Energy & Natural Resources

Contributed by Schoenherr
Amendments bring overall relief to system charges
  • Austria
  • 06 May 2019

The Austrian regulatory authority E-Control is responsible for ensuring an equal energy market and a fair market price. Each year E-Control reviews and defines the system charges for the use of electricity and gas networks on all network levels. The System Charges Ordinance 2019 and the Gas System Charges Ordinance 2019 bring further relief to system charges.

Consultation on implementation of network code on harmonised transmission tariffs
  • Austria
  • 29 April 2019

The national regulatory authority E-Control recently published its consultation document on the implementation of the network code on harmonised transmission tariff structures in Austria. The document is structured in line with the Agency for the Cooperation of Energy Regulators consultation template. However, it appears that E-Control paid little attention to maximum transparency and traceability when setting transmission tariffs.

New coordinated network development plan introduced
  • Austria
  • 17 December 2018

In order to ensure that gas supplies are secure and to achieve a high level of capacity availability, the Gas Act requires the market area manager (MAM) to prepare an annual coordinated network development plan. The MAM recently submitted a draft version of the 2018 plan to E-Control. The latest plan ensures that, among other things, the supply of gas to end consumers is protected, the line capacity is considered and transport requirements are met.

Automatic permits for certain energy infrastructure projects
  • Austria
  • 03 September 2018

The proposed new Location Development Act aims to regulate a special selection procedure for individual, location-relevant projects (eg, electricity grids and power plants). While the economy rejoices over faster legal security, non-governmental organisations and lawyers have expressed doubts about the maintenance of the standard of other material laws and the legal admissibility of the government project.

Proposed amendments to gas ordinances and balancing system
  • Austria
  • 07 May 2018

To comply with the applicable EU regulations, E-Control recently published draft amendments to the Gas System Charges Ordinance 2018 and the Gas Market Model Ordinance. In response to international criticism, E-Control also proposed a redesign of the Austrian gas balancing system. In order to implement these amendments in the current Austrian gas market, a proposal to establish a virtual interconnection point at Baumgarten has also been drafted.


Environment & Climate Change

Contributed by Schoenherr
Electric vehicles exempt from emissions-reducing speed limits
  • Austria
  • 18 March 2019

The Constitutional Court recently dealt with a complaint by an electric vehicle owner who had exceeded an Air Immission Protection Act speed limit. The driver claimed that his vehicle emitted no air pollutants and that the emission-dependent speed limit did not apply to him. The court disagreed. In response to this decision, the federal government created a legal exception for electric cars. However, whether all federal states will introduce an exception to the act's speed limit for electric cars remains unclear.

Parliament adopts comprehensive environmental package
  • Austria
  • 12 November 2018

Parliament recently adopted a new comprehensive environmental package comprising the Aarhus Participation Act, an amendment to the Environmental Impact Assessment Act and an amendment to the Federal Environmental Liability Act. With the new package, the legislature has attempted to manage the difficult act of balancing the necessary legal adaptations of administrative procedural law with EU law and creating a business environment that is nevertheless competitive.

Will new state targets lead to reduced environmental protection?
  • Austria
  • 03 September 2018

The Constitution provides so-called 'state targets', which are broadly diversified and include state targets on sustainability. The approval procedure for the third runway at Vienna International Airport has prompted the government to strengthen Austria as a business location. This should be achieved by amending the Federal Constitutional Law on Sustainability which, among other things, contains a state target on creating comprehensive environmental protection.

Right to clean air – latest developments
  • Austria
  • 07 May 2018

In general, the Austrian legal system does not give individuals the right to force the legislature to act in a specific way or pass concrete laws. Normally, only political pressure can combat inaction. However, when it comes to air quality, things are different. The Austrian Higher Administrative Court has declared that individuals who live in a territory where the air pollution limits are exceeded have the right to demand that measures under the Air Immission Protection Act be enacted or amended.

New outlines for water management and planning
  • Austria
  • 02 October 2017

The first update and review of Austria's national water management planning instrument has revealed that the objectives of the EU Water Framework Directive will be achieved neither to their full extent nor in a timely manner. Nonetheless, the National Water Management Plan 2015 is a useful and comprehensive document that contains extensive information for all stakeholders and sets out the next steps to achieve the ultimate goal of restoring Austria's water bodies.


Healthcare & Life Sciences

Contributed by Preslmayr Attorneys at Law
Cannabidiol in food and cosmetics
  • Austria
  • 15 May 2019

While there are signs of greater liberalisation with respect to hemp use internationally, the Austrian government has resisted this trend. In October 2018 the Ministry of Labour, Social Affairs, Health and Consumer Protection published a decree outlining its legal opinion on product regulations which prohibit CBD use in food and cosmetics. However, rather than providing legal certainty, the decree merely reflects headlines relating to the government's narcotics programme.

Social security system to undergo restructure – but will it achieve cost savings?
  • Austria
  • 20 March 2019

The Austrian social security system has been characterised by regional and occupational fragmentation and the domination of employee representatives. However, a recent amendment to the Social Security Act proposes merging the provincial social security institutions with the company insurers into one Austrian Health Insurer, which will be the only provider of employee health insurance.

Amendment to Act on the Medical Profession
  • Austria
  • 23 January 2019

The two chambers of the Austrian Parliament recently adopted the government bill on the amendment of the Act on the Medical Profession. The amendment will enter into force following its publication in the Law Gazette, which is expected in late January 2019.

Misleading comparative advertising of drugs
  • Austria
  • 28 November 2018

The Supreme Court recently ruled in an interesting case relating to comparative advertising. The court ultimately found that the challenged announcement was 'comparative advertising' within the meaning set out in Section 2a(1) of the Unfair Competition Act, as it directly and indirectly identified a competitor and its goods and services. The decision follows the letter of the law and perfectly summarises the legal structure regarding comparative and drug advertising in Austria.

No liability for in-depth specialist knowledge
  • Austria
  • 07 November 2018

The Supreme Court recently provided an extensive description of the principles of medical liability and held, in concrete terms, that the standard of care principle must not be overstretched. The court confirmed that the expert liability provided for in the General Civil Code is based on an objective standard and thus depends on the usual diligence of the persons who carry out the activity in question. As such, the performance standard of the occupational group concerned will be a decisive factor.


Insolvency & Restructuring

Restructuring plans and their impact on non-participating creditors
  • Austria
  • 05 April 2019

Under the Insolvency Act, once a restructuring plan has been confirmed, the debtor is discharged from its debt and is subsequently prevented from paying its creditors their deficiency or repaying other granted benefits. Consequently, any claims that were not registered during the insolvency proceedings – even if they should have been – fall under this restriction and cannot be repaid. That said, exceptions to the rule exist.

Avoidance of overdraft payments due to preferential treatment
  • Austria
  • 21 December 2018

The Insolvency Act provides insolvency administrators with an abundance of tools to challenge any actions committed by a debtor during a crucial period prior to the opening of insolvency proceedings. Two recent Supreme Court decisions summarise the existing judicature and further clarify the elements of avoidance due to preferential treatment.

Is Beneficial Ownership Register Act compliance an insolvency administrator's duty?
  • Austria
  • 05 October 2018

Before the most recent update to the online FAQ section by the responsible authority, the question of whether Beneficial Ownership Register Act compliance is an insolvency administrator's duty was unclear. Due to the tight timeframes for complying with the act and the range of practical problems arising from it, the question has caused headaches for insolvency law practitioners in Austria.

Liability for payments after company has become insolvent
  • Austria
  • 22 June 2018

If a managing director of a company makes payments after a substantive insolvency, they may be liable for damages under the Statute on Limited Liability Companies. Managing a company in a crisis situation requires special diligence and care. In order to avoid unpleasant surprises later on, where possible, the admissibility of envisaged future payments should be checked in advance.

New group insolvency law
  • Austria
  • 08 December 2017

The Insolvency Code was recently amended in response to the introduction of the EU Insolvency Regulation, creating – for the first time – specific rules for the insolvency of corporate groups in Austria. From a practical standpoint, this approach is welcome, as it may lead to faster and more efficient insolvency proceedings. It remains to be seen how the new rules will affect insolvency practice and whether coordination proceedings according to the EU regulation will be applied in practice.