English »Legal Updates
Right of withdrawal for prepay purchases does not apply to foreign currency loans
The Consumer Protection Act allows consumers to withdraw from the contract subject to certain conditions, if certain factors are unknown at the time of conclusion of the contract. According to a recent decision of the Supreme Court for Civil Matters, this law doesn’t apply to foreign currency loans – not even by analogy. The consumer knows the exact amount he has to repay – albeit in a foreign currency. Exchange rate fluctuations and other risks are integral parts of such. (1Ob190/16x)
11. April 2017
The right designation for a savings book
The family name of a person other than the identified customer must not be used as a designation for a savings book – according to the Austrian Banking Act. The Supreme Court for Civil Matters recently dealt with a case where this happened anyway: The bank failed to prevent the identified customer from using such designation for a savings book. The identified customer caused damage to the person who actually and rightfully uses the name. Nevertheless the latter was unable to claim damages from the bank. According to the Supreme Court for Civil Matters this particular case was not covered by the purpose of the law. (8Ob66/16p)
28. March 2017
„GmbH-light “: one step forwards one step backwards – it’s fine by the constitution
After the amendments of the Austrian Limited Liability Company Act there are now three different Austrian GmbH’s with different share capital requirements. An amendment in 2013 lowered the share-capital requirement from 35,000 Euro to 10,000 Euro. Also, previously founded GmbH’s were enabled to lower their share-capital. Since 2014 the share-capital requirement is raised up to 35,000 Euro again. There is still a privilege for newly founded GmbH’s though: they can keep their share-capital in the amount of 10,000 Euro for ten years. Previously founded GmbH’s however can’t make use of this privilege. In its recent decision the Supreme Court of Constitution now found with respect to the principle of equal treatment that this is not unconstitutional (G311/2016).
14. March 2017
Online customer identification
The FMA Regulation on video-based online identification of customers enters into force on 03.01.2017. Participants of the Austrian financial market, such as banks, insurance companies and investment firms are permitted to use “video-based identification” in order to determine the identity of their customers and to check their legitimacy. Based on the recently passed Financial Markets Anti-Money Laundering Act (FM-GwG; Finanzmarkt-Geldwäschegesetz), the FMA defines in the Online Identification Regulation (Online-IDV; Online-Identifikationsverordnung) the protective measures to be taken to reduce the risks that result from the determination and checking of the identity of customers in the customer’s physical absence.
26. February 2017
Generous rights to withdraw for consumer-investors
According to the provisions of the capital market act (only) consumer-investors have in any case the right to withdraw their submitted offer, if an obligatory supplement to the prospectus was not published. They are also granted the right to withdraw their acceptance in cases where the initial prospectus was fundamentally incorrect or incomplete. It is required though, that the purchase of the securities took place during a public offering.
29. January 2017