The Legal 500

M&A transactions and all forms of corporate reorganisations (e.g. mergers, de-mergers, transformations, contributions in-kind) are governed by the Companies Act (CA).

Once again, business law firm Fellner Wratzfeld & Partners (fwp) is among the front-runners in Austria where international rankings are concerned, a fact confirmed by the Chambers Global Guide 2012, which was published in March 2012.

Public bids are regulated under the 1999 Takeover Act (TA), as thoroughly amended by the 2006 TA Amendment Act. The TA applies provided the target is a joint stock corporation (AG) based in Austria and its shares are admitted to trading on the Vienna Stock Exchange (Wiener Boerse; VSE) at a regulated market.

In the course of the second stabilisation package 2012*, the new § 2 b Labour Market Policy Financing Act (Arbeitsmarktpolitik-Finanzierungsgesetz – AMPFG) was agreed upon.

As of 1 April 2012, the Czech Public Procurement Act (Act No. 137/2006 Coll.) has been significantly amended.

Schoenherr's Italian Desk was established in April 2008. It is headed by Daniele Iacona, based in the Bucharest office. Legal Insights spoke with Daniele about the Italian Desk in 2009 (see www.schoenherr.eu/news-publications/legal-insights/qua-head-of-schoenherrs-italian-desk). Here is an update.

Choosing or changing a multinational company's headquarters involves considerations of quality of living and political stability in addition to economic and legal issues. This arti-cle, in two parts, outlines some of the advantages of and basic information about choos-ing Austria for a company’s headquarters. Part 1 is an overview of Austria's social and political background and of some legal forms to consider for a holding company. Part 2 will introduce Austrian tax law and provide additional legal information.

The Hungarian Companies Act ("CA") and others have long contained provisions to protect creditors. One provision prohibits a limited liability company from paying dividends to its shareholders if it does not have sufficient funds.

On December 8, 2011 an amendment of the Foreign Trade Act 2011 (Außenwirtschaftsgesetz 2011, until then Außenhandelsgesetz 2011, “FTA 2011”) entered into force imposing a substantial new barrier on foreign investors when acquiring shares in Austrian companies that operate in areas of public security and order. This amendment came as a surprise as part of the Budget Consolidation Act 2012 (Budgetbegleitgesetz 2012), governing different topics. The key points of the new barrier for foreign investors are the following:

in Certain Industry Sectors by Non-EU/EEA and Non-Swiss Persons

An amendment of the Austrian Foreign Trade Act (FTA), in force since 08/12/2011 subjects the acquisitions of relevant interests in enterprises in specific industries, including telecoms and energy, to review and approval by the Austrian Ministry of Economic Affairs

Did you have an unsettled pecuniary claim against a Slovenian company that was deleted ex officio from the companies’ register without liquidation due to inactivity? Did you continue the recovery procedure against the shareholder? We suggest you check whether the procedure is still open!

notarial deed form

Prevailing Opinion in the Past
Pursuant to Sec 76 of the Austrian Act on Limited Liability Companies (GmbHG), agreements on a transfer of shares in a GmbH must be drawn up in the form of an Austrian notarial deed. This form requirement applies to both the legal title (i.e. the underlying obligation) such as e.g. a share purchase agreement, as well the transfer deed. The form requirement also applies to agreements on future (potential) trans-fers such as e.g. option agreements or agreements on rights of first refusal (Vor-kaufsrechte).

The legislative proposals by the European Commission of 20 October 2011 aim to replace and to extend the existing legal framework based on the Market Abuse Directive 2003/6/EC and to adapt it to market developments since 2003.

Country Question and Answer Chapters:

18 Austria Fiebinger Polak Leon & Partner Rechtsanwälte GmbH: Dr. Peter M. Polak & DDr. Karina E. Hellbert

In June 2011 the Commission for Protection of Competition issued Guidelines for the Detection of Bid Rigging in Public Procurement.

Today's Belgian Official Journal contains the two Acts implementing a number of modifications to the Act concerning the social elections procedure and to the Act regulating the court procedures in the event of disputes.

GEORG ADLER

Branches of one of Austria’s largest drugstore chains have been distributing brochures recently that advertise drugs by a pharmaceutical company established in the European Economic Area (EEA).

Anhebung der Gerichtsgebühren für die Eigentumseintragung im Grundbuch

Increase in court fees

Increase in court fees for property registration in the Land Register

Background During the 1990's, companies in Croatia experienced a process of privatisation which saw socially-owned companies being sold to private investors.

In July 2009 the Competition Protection Commission initiated procedures against the largest retail chains in Bulgaria – Metro Cash & Carry EOOD, Billa Bulgaria EOOD, Kaufland Bulgaria EOOD, Picadili AD, Maksima Bulgaria EOOD and Hit Hypermarket EOOD – for suspected prohibited practices. The procedures were opened after the commission received several indications from the Bulgarian Confe-deration of Employers and Industrialists that the chains were engaged in anti-competitive activity.Bulgaria: Competition Protection Commission in-vestigates retail chains

On 16 October 2009 the European Commission awarded a contract for the preparation of a study on the overall functioning of the trade mark system in Europe to the Max Planck Institute for Intellectual Property and Competition Law. The Study has now been pub-lished and has been made available through the website of the European Commission: http://ec.europa.eu/internal_market/indprop/tm/index_en.htm 

Prevailing Opinion in the Past: Pursuant to Sec 76 of the Austrian Act on Limited Liability Companies (GmbHG), agreements on a transfer of shares in a GmbH must be drawn up in the form of an Austrian notarial deed. This form requirement applies to both the legal title (i.e. the underlying obligation) such as e.g. a share purchase agreement, as well the transfer deed. The form requirement also applies to agreements on future (potential) trans-fers such as e.g. option agreements or agreements on rights of first refusal (Vor-kaufsrechte).

Over the past 20 years Slovakia has gained extensive experience in privatisation as part of the process of transferring state property into private hands. Slovakia’s privatisation backlog started shortly after the fall of the Iron Curtain, continues to the present day and, apparently, will have to be dealt with for some time to come.

In line with many other jurisdictions, the Austrian M&A market has suffered from the financial crisis both in terms of volume and number of deals. Most estimates and statistics have shown a drop-off in 2008 of between 20% and 30% as compared to 2007

Country Q&A Austria

Companies are often forced to acquire the services of a local partner or intermediary when starting or conducting their business abroad, particularly in CIS countries. If such local partners use corrupt practices, such as bribery, this can cause significant damage to the reputation and finances of the company.

A practical insight to cross-border Mergers and Acquisitions.

In times of crisis, it is particularly important for the managing director of a limited liability company to meet all legally prescribed obligations regarding auditing and notification in a timely manner in order to avoid any possible (personal) liability. In Croatia, countless companies ("društvo s ograničenom odgovornošću" or abbreviated "d.o.o.") exist in which foreigners act as managing directors. Thus, knowledge of and attention to legal distinctions are of significant importance.

The International Comparative Legal Guide to: Product Liability 2008

In its recently published "White Paper on Damages actions for the breach of EC antitrust rules" the European Commission identified access to cartel evidence as one of the key elements for enhancing private enforcement actions against anti-competitive practices.

Amendments for auditors, supervisory boards and capital markets-oriented companies

Several accounting scandals in the recent past caused the EC to adopt both the Directive 2006/43/EC (Statutory Audit Directive) and Directive 2006/46/EC (Company Reporting Directive). The directives will improve the credibility of financial information and strengthen protection against financial scandals. These directives will be implemented in Austria with the legislative proposal for a Business Law Amendment Act 2008 (Unternehmensrechts-Aenderungsgesetz 2008, "URAeG 2008"). The amendments will be applicable for business years starting after 31 December 2008. However, some of the amendments will be in effect by 1 June 2008.

Austria is fairly unique in Europe in that it has wide-reaching provisions imposing by statute successor liability on purchasers in asset deals for pre-existing liabilities of the business sold.  Provisions on purchaser liability for asset deals are contained in both the General Civil Code as well as the Company Act and apply cumulatively.  This year the Austrian Company Act was considerably revised. New provisions of the Austrian Company Act went into effect on January 1, 2007 that substantially alter the parameters of purchaser successor liability.  This article will outline the impact of these changes and also highlight some other new provisions that are relevant for assets deals.