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Applicable law - Austria

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TABLE OF CONTENTS

Sources of law Sources of law
1.1. National law 1.1.
1.2. Multilateral conventions 1.2.
1.3. Bilateral Conventions 1.3.
Application of the conflict of law rules Application of the conflict of law rules
2.1. Official application of conflict of law rules 2.1.
2.2. Reference 2.2.
2.3. Change of connecting factor 2.3.
2.4. Exceptions to the application of conflict rules 2.4.
2.5. Establishing foreign law 2.5.
Conflict rules Conflict rules
3.1. Contractual obligations 3.1.
3.2. Non-contractual compensation claims 3.2.
3.3. Personal status 3.3.
3.4. Parentage, relationship between parents and children, including adoption 3.4.
3.5. Marriage, partnerships, divorce, maintenance 3.5.
3.6. Matrimonial property regime 3.6.
3.7. Succession, wills 3.7.
3.8. Real rights 3.8.
3.9. Insolvency 3.9.

 

1. Sources of law

1.1. National law

Austrian private international law (IPR) is codified. The underlying law is the International Private Law Act (IPRG) of 15.6.1978, Federal Law Gazette No. 304/1978. The following provisions on the conflict of laws lie outside the IPRG:

  • Article 13(a) of the Federal Act of 8 March 1979, in which provisions are made for the protection of consumers (Consumer Protection Act - KSchG), Federal Law Gazette No. 140/1979,
  • Article 11 of the Federal Act on the acquisition of rights to part-time use of immovable property (Part-Time Use Act – TNG), Federal Law Gazette I No. 32/1997
  • Federal Act on international insurance contract law for the European Economic Area, Federal Law Gazette No. 89/1993,
  • Article 20 of the Federal Act implementing Directive 93/7/EEC on the return of cultural property unlawfully removed from the sovereign territory of a Member State of the European Community, Federal Law Gazette I No. 67/1998,
  • Article 23 of the Federal Act on civil liability for damage caused by radioactivity (Nuclear Liability Act 1999 – AtomHG 1999), Federal Law Gazette I No. 170/1998,
  • Federal Act on international insurance contract law for the European Economic Area (IVVG), Federal Law Gazette No. 89/1993,
  • Articles 16 and 18 of the Federal Act on validity of accounts in payment systems, security delivery systems and security accounting systems (Finality Act), Federal Law Gazette I No. 98/2001,
  • Articles 221 to 235 of the Federal Act on international insolvency law (IIRG), Federal Law Gazette I No. 36/2003.
1.2. Multilateral conventions

According to Article 53 IPRG, international agreements are not affected by the IPRG. They take precedence over the provisions of this Act – and other national conflict rules. The following multilateral conventions, to which Austria has signed up, contain conflict of law rules:

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1.3. Bilateral Conventions

The following bilateral treaties contain conflict of law rules:

  • Friendship and Residence Treaty of 9 September 1959 between the Republic of Austria and the Empire of Iran
  • Treaty of 16 December 1954 between the Republic of Austria and the Federal People’s Republic of Yugoslavia on mutual legal dealings
  • Treaty of 11 December 1963 between the Republic of Austria and the People’s Republic of Poland on mutual relations in civil law matters and on documentation
  • Treaty of 9 April 1965 between the Republic of Austria and the People’s Republic of Hungary on succession matters.

2. Application of the conflict of law rules

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2.1. Official application of conflict of law rules

Foreign law is applicable officially and as in its original area of application (Article 3 IPRG).

2.2. Reference

According to Article 5 IPRG, a reference is to be complied with unless reference is particularly made to the relevant law. If the foreign law refers back to Austrian law, then Austrian law is decisive. If the foreign law refers to a law that has already been referred to, then the law to which reference was first made is decisive.

2.3. Change of connecting factor

The subsequent changing of the conditions decisive for the connection to a specific legal regulation does not affect elements of a case that have already come to an end (Article 7 IPRG). For concluded factual circumstances, therefore, the law decisive at the time the factual circumstances came about and, for ongoing circumstances, the law decisive at the time of judgement is applicable in principle.

2.4. Exceptions to the application of conflict rules

The law referred to is not applicable if its application would produce a result that is incompatible with the fundamental values of Austrian law and order (Article 6 IPRG).

Under Austrian law, there are provisions which are applicable irrespective of the rules of the IPR (intervention standards). In the case of some of these provisions, their character as intervention standards is the result of the way they are worded, in others merely as a result of their object.

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2.5. Establishing foreign law

Foreign law is to be established officially. For this purpose, the court can rely on the cooperation of the parties, on information from the Federal Ministry of Justice or on expert reports. If, despite considerable efforts, foreign law cannot be established within the stipulated time, Austrian law is then applicable (Article 4 IPRG).

3. Conflict rules

3.1. Contractual obligations

Contractual obligations, which are not covered by the Rome Convention, are to be judged according to the law expressly or conclusively specified by the parties. If no law has been chosen, Articles 46 to 49 IPRG (Article 35 IPRG) apply. However, as Articles 46 to 49 do not govern contractual obligations, then, because there are no particular provisions under Article 1 IPRG, the law to which the facts of the case most closely relate is decisive.

Special conflict of law rules apply to consumer contracts: In Art. 13(a)(1) of the Consumer Protection Act (KSchG), the conflict rules of a number of consumer protection directives are implemented. The provision mainly restricts the freedom to choose the law on consumer protection. A further IPR provision also restricting the freedom to choose the law is contained in Article 11(1) of the Part-Time Use Act (TNG).

The Federal Act on international insurance contract law for the European Economic Area, which implements directives, governs the law applicable to insurance contracts, which covers the risks existing within a Member State of the EEA. There is a – restricted – right to choose the law. If no choice of law exists, the law of the State to which the contract most closely relates is decisive. It is assumed that the closest relationship exists with the State in which the risk is covered. The coverage of the risk is adapted separately for the various types of insurance.

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Intervention standards are, for example, Articles 7, 7a and 7b of the Employment Contract Law Amendment Act (AVRAG), according to which employees in Austria are at least entitled to wages negotiated by collective agreement and to minimum holiday irrespective of the decisive law. A further intervention standard is Article 13(a)(2) KSchG, according to which Article 6 KSchG (on inadmissible contractual elements), Article 864a ABGB (on the validity of unusual provisions in general terms of business and contractual forms) and Article 879(3) ABGB (on the nullity of grossly prejudicial contractual provisions in general terms of business and contractual forms for protecting consumers) are applicable irrespective of the law decisive for the contract if the contract is concluded in connection with an activity carried out by the undertaking in Austria with the aim of concluding such contracts. A similar intervention standard is Article 11(2) TNG.

3.2. Non-contractual compensation claims

The connecting factor for non-contractual compensation claims is governed by Articles 35 and 48 IPRG.

They are to be judged according to the law chosen by the parties to the obligation and, if no such choice of law has been made, according to the law of the State in which the conduct causing the damage occurred. However, if, for the parties concerned, there is a stronger relationship to the law of one and the same different State, then the law of this State is decisive.

This conflict of law rule specifies the decisive law for questions regarding whether a compensation obligation has arisen, who is obliged to pay the compensation and how much is owed. It also includes questions of contributory negligence and the direct claim of the injured party against the insurer, as well as the barring of claims for compensation under the statute of limitations.

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Compensation claims resulting from traffic accidents, which fall within the scope of the Hague Convention of 4 May 1971 on the law applicable to traffic accidents, are to be connected under this Convention.

For compensation claims (and other claims) resulting from unfair competition, the law of the State on whose market the competition takes place is decisive (Article 48(2) IPRG).

Non-contractual claims for compensation of damage occurring in Austria as a result of ionising radiation are, at the request of the injured party, to be judged under Austrian law (Article 23(1) AtomHG 1999). If damage caused by ionising radiation occurs abroad and is to be judged according to Austrian law, the damage only then has to be compensated to the extent that the personal status (see 3.3.) of the injured party so provides (Article 23(2) AtomHG 1999).

Conducting business on another party’s behalf without their request is to be judged according to the law of the State in which it was carried out. However, if it is closely related to another legal relationship, then the law that is decisive in respect of this legal relationship is applicable (Article 46 IPRG).

Enrichment claims are to be judged according to the law of the State in which the enrichment occurred. However, if the enrichment is based on an action that was carried out on the basis of a legal relationship, then the material standards (disregarding reference) of the State whose material standards are applicable to the legal relationship are decisive (Article 46 IPRG).

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3.3. Personal status

A person’s personal status is the law of the State whose nationality they have. If a person has more than one nationality, then the law of the State to which the person is most strongly related is decisive. However, Austrian citizenship is always decisive. For refugees and stateless persons, personal status is the law of the State in which they usually reside (Article 9 IPR-G).

The use of a person’s name is to be judged according to their respective personal status, on whatever ground the taking of the name is based (Article 13 IPRG).

The married name is, for example, not therefore to be judged according to marital status but according to the name status. For the form of name designation declarations, the general formal status of Article 8 IPRG applies. (Accordingly, the form of a legal act is to be judged according to the same law as the legal act itself; however, it is enough to comply with the formal requirements of the State in which the legal act is carried out.) According to the case law, a name taken under a previous personal status is changed not simply by changing the personal status (nationality).

A person’s legal capacity and capacity to act are also to be judged according to their personal status (Article 12 IPRG).

Included under this reference is any restriction of capacity to act, for example as a result of insanity, but not capacity to marry. If a person has come of age, then they remain so even if they would not yet have done according to a newly acquired personal status.

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3.4. Parentage, relationship between parents and children, including adoption

The requirements for the legitimacy of a child and their contestation are to be judged according to the personal status (see 3.3.) that the spouses had at the time of the birth of the child or, if the marriage had been dissolved beforehand, at the time of the dissolution. If the spouses have different personal statuses, the personal status of the child at the time of birth is decisive.

The field of application of this reference standard includes the presumption of paternity of the husband, the grounds for contesting legitimacy and also the question of which people are entitled to contest legitimacy, and time limits to contest the legitimacy.

The requirements for the legitimation of an illegitimate child through a declaration of legitimacy (for example as a result of national sovereignty) are to be judged according to the personal status of the father (Article 23 IPRG).

The effects of legitimacy and legitimation of a child are to be judged according to its personal status (Article 24 IPRG). According to the legitimation convention, legitimation through subsequent marriage of the parents is valid if it is valid according to the national law of the father or the mother.

Article 24 IPRG covers questions of caring for and raising the child, management and use of the child’s assets, legal representation by one or both parents, including the need for official approval of certain representation activities, the settlement of parental or paternal authority following the divorce of the parents and mutual maintenance claims. This provision is largely overlapped by the Hague Convention on the protection of minors. Accordingly, the relevant authorities have to apply their own law with respect to measures for protecting minors; the authorities in the State of residence are usually competent.

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The requirements for determining and recognizing the paternity of an illegitimate child are to be judged according to the personal status of the child at the time of birth. A later personal status of the child is decisive if the determination or recognition is permissible according thereto but not according to the personal status at the time of birth. The law according to which paternity is determined or recognized is also decisive for contesting it (Article 25 IPRG).

The effects of the illegitimacy of the child are to be judged according to its personal status (Article 25 IPRG).

While, as far as questions of parentage are concerned, it comes down to the personal status at a given time, this is not so for questions regarding the relationship between parents and child; what matters is the respective personal status of the child.

The adoption of a child depends both on the personal status of the adopting parents and of the chosen child. The decisiveness of the personal status of the child is restricted unless it is personally authorized. In this case, its personal status is only decisive for the consent of the child or of a third party to whom the child is related under family law.

The effects of the adoption of a child are to be judged according to the personal status of the adopting parent, and in the case of adoption by spouses according to the law that is decisive for the personal legal effects of the marriage (see, in this respect, paragraph 3.5.). Following the death of one of the spouses, the personal status of the other spouse is decisive for these effects.

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The field of application of Article 26 IPRG includes the material requirements for the adoption of a child, such as the age of the adopting parent, the difference in age between the adopting parents and the chosen child or the question of whether and under what conditions the existence of the adopting parent’s own children bars adoption of a child. In addition, Article 26 IPRG also applies to the requirements of consent, including the possibility of officially replacing refused consent. The effects of the adoption of a child in terms of succession law are to be judged not according to the adoption status but according to the succession status (see paragraph 3.7.).

The adoption of a child as such is a concluded factual circumstance, so the judgment does not change if the personal status or the connecting factor is subsequently changed. The adoption of a child is a permanent legal relationship. The status that is decisive for the effects of the adoption of the child is therefore changeable. It therefore depends on the respective personal status of the adopting parent.

3.5. Marriage, partnerships, divorce, maintenance

The form of a marriage in Austria is to be judged according to Austrian law, and the form of a marriage abroad is to be judged according to the personal status of each of the betrothed; however, it is enough to comply with the formal requirements of the place in which the marriage took place (Article 16 IPRG). With the restricted reference to the formal requirements of the place where the marriage took place, only the provisions of the law referred to under substantive law are included, so any reference of local law is therefore insignificant (exception from Article 5 IPRG, see paragraph 2.2).

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The requirements for marriage and nullity of a marriage and the requirements for annulling the marriage (to be distinguished from divorce) are to be judged for each of the betrothed according to their personal status (Article 17 IPR-G).

This reference standard relates to all material requirements for marriage, in other words primarily to the required age, the absence of impediments to marriage, any consent requirements and their replaceability.

According to Article 18 IPR-G, the personal legal effects of marriage are to be judged according to the common personal status of the spouses; if there is not a common personal status, according to the last common personal status, if one of them has kept it. Otherwise, they are to be judged according to the law of the State in which both spouses usually reside; if no such residence exists, according to the law of the State in which both had their last usual residence, if one of them has kept it.

The field of application of this reference standard includes in particular the obligation to conjugal community, consequence for residence, obligation to provide assistance, and also the spouses’ right to maintenance. It does not include married name law or the matrimonial property regime.

The reference is changeable; if the connecting factors change, then a different law may become decisive.

In accordance with Article 20 IPRG, divorce is to be judged according to the law that is decisive for the personal legal effects of the marriage. What matters here is the time of the divorce.

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The requirements for divorce and its effects are included. This provision includes, for example, the right to maintenance after divorce.

As the connecting factor depends on a specific time, the reference is not changeable.

The dissolution of a marriage is unknown under Austrian law. It would therefore have to be connected according to Article 1 IPRG according to the closest relationship. The closest relationship would probably find the case law in analogy to Article 20 IPRG.

Conjugal community and partnership are not expressly regulated under Austrian law either. They would therefore also have to be connected according to Article 1 IPRG.

3.6. Matrimonial property regime

The matrimonial property regime is to be judged according to the law that the parties expressly specify, or if no such legal choice is made according to the law that is decisive at the time of the marriage for the personal legal effects of the marriage (Article 19 IPRG).

The reference standard includes both the legal and the contractual matrimonial property regime.

The legal connecting factor is unchangeable.

As far as the form of marriage agreements is concerned, Article 8 IPRG applies, wherein, for the form of a legal act, compliance with the formal requirements of the State in which the legal act is carried out is enough.

3.7. Succession, wills

According to Article 28 IPRG, succession is to be judged according to the personal status of the deceased at the time of death. This law is used to decide which people are named as heirs, what shares of the estate they receive and what compulsory portion of their parent’s estate they may be owed, the legal position of the legatee, charges and the right of overlooked persons entitled to a compulsory portion of the estate to a gift.

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However, capacity to inherit and unworthiness to inherit are determined not according to the inheritance status but according to the personal status of the heir.

The liability for debts of the estate and inheritance purchase in principle also fall within this conflict standard. However, if succession proceedings are carried out in Austria, then the inheritance purchase and the liability for debts of the estate are to be judged according to Austrian law (Article 28(2) IPRG).

According to Article 29 IPRG, it is not the personal status of the deceased but the law of the State in which the assets are located at the time of death that is decisive for the succession in the case of an estate that is heirless or that is given to a local authority as the legal heir.

Article 30 IPRG governs the validity of a disposition on the basis, in particular, of a will, an inheritance contract or an inheritance renunciation contract. It is to be judged according to the personal status of the testator at the time of the legal act. If the will is invalid according to this law, but acceptable according to the personal status of the testator at the time of death, then the latter is decisive. This provision takes precedence over the Hague Convention on wills.

3.8. Real rights

The acquisition and loss of real rights to tangible property, including tenure, are to be judged according to the law of the State in which the property is located on conclusion of the factual circumstances underlying the acquisition or loss. The legal kind of property and the contents of the rights are to be judged according to the law of the State in which the property is located (Article 31 IPRG).

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The area of application of the reference standard includes, in particular, ownership, servitudes (charges on land), pledge, building law, flat ownership, and rights of retention effective against third parties. The consequences of the transfer of ownership are also covered by this law.

A subsequent change of location does not affect the applicable law, because the acquisition of the right represents a concluded fact.

The effects of an acquisition of a right are based on the law of the respective location. This connecting factor is therefore changeable.

Questions relating to the extent of legal protection of the owner, whether and to what extent the party having the real right is authorized to dispose of it, for example whether pledged collateral can also be sold without judicial intervention, and other questions are to be judged according to this law.

There is a special ruling for means of transport (Article 33 IPRG). Real rights to water- and aircraft that have been entered in a register are to be judged according to the law of the registering State; for railway vehicles, the law of the State in which the railway company in whose operation the vehicles are used has the actual management headquarters is decisive.

For legal and compulsorily justified pledges or legal rights of retention to secure claims for compensation for damage caused by the vehicle or expenditure thereon, the law of the State in which the property is located if the underlying factual circumstances have concluded is applicable.

There is also a special ruling for immovable tangible property: if real rights to immovable property are also included in the area of application of another reference standard (for example that for the matrimonial property regime), the property law reference, that is to say the connection to the law of the State in which the property is located, takes precedence.

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There is no reference standard for intangible property. In accordance with Article 1 IPRG, this would have to be judged under property law according to the law to which it is most closely related. Chartered rights are judged according to lex cartae. Article 33(a) IPRG, which implements Art. 9 of Directive 2002/47/EC on financial securities with a wider area of application, contains a special standard for securities that can be transferred by means of the security clearing system. For securities in accounting systems, special rulings of Articles 16 and 18 of the Finality Act, which implements the Finality Directive 98/26/EC, apply.

3.9. Insolvency

International insolvency law is regulated in Part Four of the Bankruptcy Act. This Part was inserted by the Federal Act on international insolvency law (IIRG), Federal Law Gazette I No. 36/2003. According to Article 217 of this Act, the provisions are only applicable where no other provisions exist under international law or, in particular, legal instruments of the European Communities, in particular EC Regulation No. 1346/2000 of 29 May 2000 on insolvency proceedings (EU Insolvency Regulation). Articles 221 to 235 regulate the decisive law. The provisions largely follow the corresponding provisions of the EU Insolvency Regulation.

In principle, for the requirements for initiating insolvency proceedings and the effects of the insolvency proceedings, the law of the State in which the proceedings are initiated applies. In particular, the section contains rules on the real rights of third parties, set-off, reservation of title, agreement on immovable property, regulated markets, employment contracts, the effect of insolvency proceedings on rights subject to registration and the law that is decisive with respect to prejudicial acts and the protection of third party purchasers, the effects on pending legal disputes, lex rei situs regarding the enforcement of property rights or other rights, set-off and debt conversion agreements, pension transactions and payments after the initiation of insolvency proceedings.

Where these rules overlap those of the IPRG or other provisions of conflict rules, these more special provisions of the Bankruptcy Act take precedence.

Further information

The wording of the provisions of the Austrian law is available (in German) in the Legal information system Deutsch under “Bundesrecht” (“Federal Law”).

« Applicable law - General information | Austria - General information »

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Last update: 03-07-2007

 
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