In Austria, legal disputes are settled primarily in state court litigation or arbitration. In addition, parties may turn to alternative dispute resolutions mechanisms such as mediation.

Litigation is primarily governed by the following judicial acts:

• The Austrian Jurisdiction Act (Jurisdiktionsnorm) which determines the competence and organisation of courts.
• The Austrian Code of Civil Procedure (Zivilprozessordnung) wich provides the procedural framework for court litigation and arbitration.
• The enforcement of judgments, arbitral awards, and preliminary remedies is governed by the Austrian Enforcement Act (Exekutionsordnung).

The Austrian court system consists of district courts (Bezirksgericht), regional courts (Landesgericht), higher regional courts (Oberlandesgericht) and one supreme court (Oberster Gerichtshof).

Depending on the amount in dispute and the subject matter of the dispute, the district and regional courts act as the first instance, appeals are made to either the regional or higher regional courts. The third and final instance is the Austrian Supreme Court.

Generally, district courts decide cases with an amount in dispute up to EUR 15,000. Disputes exceeding EUR 15,000 and disputes involving competition or intellectual property matters and matters arising from specific statutes (eg Data Protection Act) are decided by regional courts.

In Vienna, there is a specialised Labour and Social Court (Arbeits- und Sozialgericht), Commercial Court (Handelsgericht) and District Court for Commercial Matters (Bezirksgericht für Handelssachen). The Higher Regional Court of Vienna acts as court in antitrust matters (Kartellgericht).

Typically, a first hearing is scheduled within two to five months after proceedings are commenced, depending on the workload of the competent judge.

The first oral hearing aims to evaluate whether the parties are prepared to settle and determines the trial program. While cases may be decided after the first hearing, usually several additional hearings are scheduled. The time between court hearings depends on the complexity of the case and workload of the court and the parties.

Oral hearings are generally open to the public, only in exceptional circumstances, can the public be excluded, such as for the protection of family life and business secrets.

Access to documents in the court file is limited to the parties. However, third parties may be granted access, eg if they can demonstrate a legal interest, for scientific work, investigations in the public interest.

Decisions of the Austrian Supreme Court or important decisions of lower courts are accessible in anonymized form on the Austrian legal information database (https://www.ris.bka.gv.at/Jus/).

The limitation periods are part of substantive (and not procedural) law and thus regulated in the Austrian Civil Code (Allgemeines Bürgerliches Gesetzbuch) and specialised substantive laws.

The default statute of limitations is 30 years which applies unless a right is governed by a specific other limitation periods. However, most claims are subject to a short limitation period of three years, such as damage claims or the right to recurring individual payments (eg interest).

The limitation period is triggered when a right could have been asserted for the first time.

In court proceedings, a party needs to raise the statute of limitations defence, it is not observed by courts ex officio.

In principle, there are no pre-action conduct requirements. Only in certain areas (eg disputes among neighbours), mandatory pre-litigation dispute resolution mechanisms are established.

However, it is recommended that a request to comply with a claim is sent prior to initiating proceedings, to avoid bearing the legal fees if defendant immediately complies with the filed claim or does not contest it.

The procedure is initiated by filing a statement of claim with the competent court. If the claim is filed by an attorney, it must be filed via an electronic filing system (WebERV). The court examines the formal procedural requirements. If these are not met, the claim is rejected, otherwise the defendant is served by the court.

Service by the court is effected in accordance with the provisions of the Service of Documents Act (Zustellgesetz) or, within the European Union, in accordance with the European Regulation on Service of Documents, or outside the European Union pursuant to bilateral or multilateral agreements.

Service is usually carried out by a delivery service (post office) and only in exceptional cases by court or municipal employees.

The court examines the jurisdiction upon receipt of the claim. This preliminary assessment is made solely based on the assertions of the plaintiff. If defendant intends to object to the jurisdiction, such objection must be made in the first substantive writ, before addressing the merits.

International jurisdiction is determined either by the Austrian Jurisdictional Code (if the defendant is outside the European Union) or by European law in particular Brussels Ia Convention (if the defendant is domiciled in another EU Member State). Parties may generally agree on a competent court through choice of forum clauses. The validity of such choice of forum clause is however restricted if one party is a consumer.

Generally, both Austrian and European conflict law rules allow choice of law agreements. Absent an agreement, Austrian law is applicable if both parties have their domicile or seat in Austria. In international cases, Austrian courts will determine the applicable law primarily based on the ROM I and ROM II Regulations and only in specific areas not addressed by these regulations, under the Austrian Act on International Private Law (Internationales Privatrechtsgesetz).

If the court determines at the outset that the formal prerequisites for the claim are not met, the claim may be dismissed immediately. Such prerequisites are eg jurisdiction of the Austrian courts, capacity of the parties to sue and be sued.

Furthermore, if the defendant does not file a statement of defence in due time or a party fails to appear at the oral hearing, the other party may request a default judgment. The request sought by the party (claim or dismissal thereof) will then be granted unless the court considers them entirely unfounded. However, Austrian procedural law provides specific legal remedies against such default judgments which often result in them being lifted.

For monetary claims up to EUR 75,000, Austrian procedural law requires claims to be filed in a simplified procedures (Mahnverfahren), using a standardized form. Based on this information, the court issues a payment order. Should the defendant not file an objection within four weeks, the payment order becomes final and binding. If an objection is filed timely, ordinary court proceedings are initiated.

For pecuniary claims within the European Union, parties may choose to request a European payment order.

Interim relief is primarily regulated in the Austrian Enforcement Act but special provisions are included in certain other legislation such as the Patent Act, Copyright Act or Trademark Act.

Interim injunctions may be granted by Austrian courts to ensure that a claim can be enforced later or to protect a party from irreparable harm. The request for interim remedies can be combined with the claim initiating the main proceedings or be filed prior.

The Austrian Enforcement Act provides for three types of interim injunctions, for the purpose of securing (i) monetary claims, (ii) other claims, or (iii) a right or legal relationship.

First, a distinction must be made between proceedings before regional courts or district courts. Secondly, whether the proceedings are initiated with a so-called default action (Mahnverfahren).

For claims initiated before the regional courts, the defendant is served with the claim and an order to file a response within four weeks. In proceedings before district courts, such written response is not required. Rather, an oral hearing may be scheduled immediately.

Before the oral hearing, parties may – and usually do – file additional pleadings in a preparatory writ. These writs must be received by the other party and the court at least one week prior to the preparatory hearing. The court may order additional writs, submissions of documents and nominations of witnesses.

Regarding so-called default actions, see question 11.

Austrian proceedings are governed by the principle that each party offers the evidence necessary to support their pleadings at its own initiative.

There is no discovery or disclosure process as known in common law jurisdictions. Parties may request the production of a specific document not in their possession. The requesting party must reproduce the content as accurately as possible, specify what the document is supposed to prove and evidence that it is in possession of another person. Requests to produce a category of documents are not admissible.

Documents held by a governmental authority or a notary, may be retrieved at the request of the court.

The opposing party must submit a requested document in its possession, if

• it referred to it to prove its own factual obligations,
• there is an obligation under substantive law to provide it, or
• it is considered a joint document (eg was drafted in the interest of both parties or records an agreement between them)

Production of other documents may be refused, eg if the content relates to family affairs, production would lead to a risk of criminal prosecution, violate confidentiality obligations or business secrets.

The judge can draw adverse inferences from an unjustified non-compliance with a production order.

If the document is held by a third party, the third party is only obliged to submit it if such obligation arises from substantive law or it is a joint document.

Generally, all evidence must be taken before the court, in the presence of the deciding judiciary. Written witness statements, affidavits or depositions of witnesses are admissible in civil court proceedings only under exceptional circumstances (in contrast to arbitration).

Austrian law differentiates between the testimony of witnesses and party representatives. Witnesses are obliged to appear in court, testify and, if necessary, take an oath. If a witness fails to appear, an administrative fine and other costs may be imposed.

A witness may refuse to testify, eg if it might trigger a risk of criminal prosecution, pecuniary disadvantages or based on special statutory rights to refuse testimony (e.g. doctors or lawyers). If a witness wrongfully refuses to testify, this can lead to fines or even imprisonment.

Witnesses are primarily questioned by the judge. However, the parties or their representatives may raise additional questions.

Experts are selected and appointed by the court. Parties are given the opportunity to comment. Court appointed experts are regarded as assistants to the court and can be rejected for the same grounds as judges (eg lack of impartiality).

In practice, a written expert opinion is often prepared first. At the request of the court or the parties, the report must be discussed at the hearing and supplemented if necessary. An additional expert is only appointed if the first expert opinion is insufficient. The mere fact that a party is not satisfied with the results is not sufficient.

While parties are free to submit private expert reports, such reports are given little evidentiary value.

An appeal (Berufung) against a judgment of first instance must be filed within four weeks after service of a written judgment. The opposing party may reply within four weeks.

The appellate court decides whether a second appeal (Revision) is permissible. This is only the case if there is a legal question of considerable importance, this may be the case if the appellate court deviated from the jurisprudence of the Austrian Supreme Court or a question of law was not yet decided by or has been decided inconsistently by the Austrian Supreme Court. Furthermore, the amount in dispute must exceed EUR 5,000. The deadlines to file a second appeal and the reply thereto is four weeks.

A court order which is not a judgment (Beschluss) can be challenged by filing a complaint (Rekurs) and subsequently a second complaint (Revisionsrekurs). Such court orders typically concern the conduct of the proceedings and procedural issues. The deadline for these remedies is generally 14 days. However, certain court orders may only be challenged together with the final judgment and others may not be challenged at all.

The recognition and enforcement of foreign judgments is governed by the Austrian Enforcement Act, European law and international treaties.

Judgments of EU Member States are enforced under the Brussels Ia Regulation (recast, 1215/2012), no separate declaration of enforceability is required. Similarly, judgments of members to the Lugano Convention will be recognized.

Outside the application of the above-mentioned treaties, a formal declaration of enforceability by Austrian courts is required (exequatur proceedings). This declaration is only granted, if the judgment is enforceable in the issuing state, and reciprocity of enforcement is provided by bilateral or multilateral treaties. Absent a reciprocity agreement, the foreign judgment will not be enforced by Austrian courts.

The Austrian Code of Civil Procedure provides that the losing party must reimburse the legal and procedural costs of the prevailing party, this includes court fees, lawyer fees and other expenses (such as travel costs). If each party succeeds partly, the costs are allocated proportionately on a pro rata basis or set-off.

Legal fees are reimbursed based on a statutory tariff, irrespective of the actual costs and arrangements between the party and its lawyer.

Irrespective of the generally ‘loser pays’ principle, a party may be ordered to reimburse costs caused by late submission of evidence or in case of an interim decision eg on an objection to the jurisdiction.

Court decisions must contain a decision on costs, this can be appealed.

There is only the so-called Austrian-style class action. The claimants assign their claims to an association. The association then asserts the individual claims in a single action. The Austrian Supreme Court requires a certain connection between the claims (similar cause of action and the same issues of law or fact).

A third party may join pending proceedings if it has a legal interest in one party prevailing. A purely economic interest is not sufficient. The intervening party may request the joinder at its own accord by filing a request in court. Parties to the proceedings may also formally request third parties to be joined. The third party is however not obliged follow such request and may also join on the respective opposing side. Refusal to join may however have negative implications under substantive law.

The joinder of the third party must be accepted by the court. Each party to the proceedings can request dismissal of the joinder.

Austrian law differentiates two kinds of joinders. If a judgment directly binds the joining party, it has equal rights to the parties of the proceedings and the same legal position. Conversely, if the outcome of the proceedings does not directly impact the joining party, it is considered a simple joinder and does not enjoy the rights (and obligations) of a party.

Multiple proceedings pending before the same court, between the same parties, may be consolidated at the court’s discretion. A consolidation decision cannot be appealed. The claims in consolidated proceedings remain legally independent and the court may thus also render a legal judgment on one claim earlier than on the other.

In recent years, litigation funding has become increasingly common. Particularly in the context of Austrian-style class actions, the associations regularly use commercial litigation funders. In return for a success fee of approx. 30%, the funder covers the costs of the lawsuit and, in the event of a loss, also the opposing party’s costs. According to the prevailing view, this does not violate the prohibition of fee arrangements giving a part of the proceeds to the lawyer (pactum de quota litis) because the funder does not act as lawyer (‘Rechtsfreund’).

In response to and for the time of the COVID-19 pandemic, the Austrian legislator allowed for oral hearings to be conducted via Zoom, provided neither party objected thereto.

In the beginning of the pandemic oral hearings were regularly postponed. However, while there still appears to be some backlog, the Austrian courts now mostly operate as prior to the pandemic. Hearings are held either in person (with respective safety measures) or via Zoom.

Austrian court proceedings, compared to other countries of the European Union and outside the European Union, are comparatively quick and efficient.

A disadvantage of litigating international commercial disputes is the requirement to conduct proceedings in German. Often documentary evidence must be translated and witnesses who do not speak German must testify with the help of an interpreter.

In the aftermath of the COVID-19 pandemic, an increase of disputes involving restructuring and payment/performance default is expected. Additionally, growth is expected in commercial disputes regarding banking and finance and construction matters.

By international standards, the Austrian judiciary has been a pioneer in digitization for many years. Submissions to court by and service of documents to Austrian attorneys and notary publics have been made through an electronic filing system for several years (WebERV).

In 2020 Austria launched a new digital website: JustizOnline. Through this platform, users can view ongoing proceedings and download their relevant files. They can also obtain extracts from the company and land registers. The chatbot ‘Justitia’ can also answer simple legal questions. A glossary of terms is used to explain legal terms in an understandable manner.

Austrian courts increasing move towards paperless files which also enables them to present exhibits electronically to testifying witnesses.

We consider it likely that the newly instituted possibility to hold hearings remotely will impact litigation proceedings in the future. However, it remains to be seen whether the Austrian legislator provides the legal framework for such changes.