Austrian Supreme Court Decides on the Term "Consumer", also with Respect to Arbitration

In recent decisions the Supreme Court has established an economic approach to the qualification of shareholders as consumers or entrepreneurs for the purposes of Section 1 of the Consumer Protection Act. This economic view has now been consolidated by a new Supreme Court decision of June 24 2010 (OGH, docket no 6 Ob 105/10z). Importantly, the economic approach is also determinative for an interpretation of Section 617 of the Code of Civil Procedure, and thus for the term "consumer" as applicable in Austrian arbitration law.

Section 617 of the code, which severely restricts the possibility of conducting arbitration agreements with consumers, applies whenever Austria is the place of arbitration. For example, according to Section 617(1), arbitration agreements with consumers can be concluded only after a dispute has arisen. Consequently, it is of considerable importance for Austrian arbitration law to which extent physical or legal persons qualify as consumers for