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Notification of a prospectus is not required for jurisdiction
An investor filed a suit in Austria claiming that a capital market prospectus was incorrect. The relevant incorrect prospectus was not notified in Austria. In this case, the Supreme Court for Civil Matters ruled on the jurisdiction of Austrian courts. According to this ruling the notification of a prospectus in Austria is not a mandatory requirement for the jurisdiction of Austrian courts. It is sufficient if the investments were made by an Austrian account, the contractual documents were signed in Austria and the settlement account was an Austrian account (6 Ob 239/18t, 5 Ob 240/18g).
8. April 2020
On the obligation of confidentiality of authorities
The Supreme Court in Administrative Matters (VwGH) recently dealt with the obligation of confidentiality of authorities. The appellant asked for information concerning him on the exchange of information between domestic and foreign authorities. The request was rejected. This was justified with the “protection of the interests of foreign relations”. In general, the interest in information and the interest in confidentiality must be weighed up. If there are public interests however, as in the present case, there is no need to weigh interests. Public interests (acc to Art 20 B-VG) always prevail (VwGH Ra 2017/01/0140 dated 28.01.2019).
31. January 2020
New minimum standards for internal audit
On 02.01.2020, the Austrian Financial Market Supervisory Authority (FMA) issued new minimum standards for internal auditing. With very few exceptions, they affect all Austrian credit and financial institutions. Changes compared to their 15 year old predecessor concern, among others, the communication between the internal auditing and the FMA. The new minimum standards also include several clarifications, such as specifications on the requirements for heads of internal auditing. Minimum standards of the FMA are so called soft-law and as such are not legally binding. Nevertheless they play a very important role in practice.
17. January 2020
Austria implements money laundering directive
The deadline for the examination of the new law implementing the EU’s fifth Money Laundering Directive (2018/843) expires on 17.12.2019. According to the new law, companies can have their trade license revoked if they use strawmen. Since art dealing is also covered by the new law, the relevant expenditure increases for affected clients such as art galleries. Increased obligations apply now vis-a-vis customers from states, from a list of states with high risk. Before only a risk assessment was necessary.
13. December 2019
ECJ: Withdrawal after nine years – not admissible
The European Court of Justice (ECJ) has recently ruled regarding the right of withdrawal according to the Distance Marketing of Financial Services Directive. The ruling was initiated for a preliminary question submitted by a German court. According to this ruling the right of withdrawal may expire, if the agreement is already fulfilled and if the bank has pointed out to the customer the shorter expiration date. In the precedent case a couple wanted to withdraw from a loan agreement with a bank after nine years; they claimed that they were informed incorrectly about their right of withdrawal (C-143/18).
15. November 2019