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Commercial Arbitration

Last verified on Wednesday 3rd April 2019

Austria

Christian W Konrad and Martin Hackl

    Infrastructure

  1. 1.The New York Convention
    Is your state a party to the New York Convention? Are there any noteworthy declarations or reservations?
    1. Austria acceded to the New York Convention in 1961 and withdrew its initial reciprocity reservation in 1988. Since then, there have been no noteworthy declarations or reservations with regard to the application of the New York Convention.

  2. 2.Other treaties
    Is your state a party to any other bilateral or multilateral treaties regarding the recognition and enforcement of arbitral awards?
    1. Austria has acceded to a multitude of bilateral and multilateral agreements in order to ensure the enforcement of arbitral awards. For example, Austria has ratified the European Convention on International Commercial Arbitration as well as the Convention on the Application of the European Convention on International Commercial Arbitration. Moreover, it has been a contracting state to the Convention on the Settlement of Investment Disputes between States and Nationals of other States since 1971, which guarantees the enforcement of awards in investor-state arbitrations conducted under the Convention.

      Apart from these multilateral treaties, Austria has also entered into a series of bilateral agreements on the recognition and enforcement of arbitral awards, inter alia, with Belgium, Croatia, Kosovo, Liechtenstein, Macedonia, Montenegro, Slovenia, Serbia and Switzerland.

  3. 3.National law
    Is there an arbitration act or equivalent and, if so, is it based on the UNCITRAL Model Law? Does it apply to all arbitral proceedings with their seat in your jurisdiction?
    1. Austria does not have a separate act on arbitration. Rather, the provisions regulating the framework of national and international arbitration proceedings are incorporated in sections 577 to 618 of the Austrian Code of Civil Procedure (ACCP). These provisions are, in principle, based on the UNCITRAL Model Law. However, the Austrian legislator saw the need to slightly adapt the provisions of the Model Law to better fit the particularities of Austrian law. 

      These provisions govern both domestic and international arbitral proceedings and apply to all arbitral proceedings seated in Austria. Moreover, parts of Austrian arbitration law are also applicable when the seat of the arbitration is not yet determined or the arbitration is seated within another jurisdiction (eg, rules on interim relief).

  4. 4.Arbitration bodies in your jurisdiction
    What arbitration bodies relevant to international arbitration are based within your jurisdiction? Do such bodies also act as appointing authorities?
    1. The Vienna International Arbitral Centre (VIAC) is currently the leading arbitration institution in Austria and focuses on the resolution of disputes between parties coming from Central and Eastern Europe. The VIAC was founded in 1975 and has since administered more than 1,600 arbitral proceedings. The VIAC also regularly acts as appointing authority.

      The VIAC is attached to the Austrian Federal Economic Chamber and was originally only granted the authority to administer solely international arbitrations. Recently, the law governing the VIAC and the Austrian Federal Economic Chamber was amended to allow the VIAC to also administer arbitrations in purely domestic disputes. The latest revision of the Vienna Rules entered into force in early 2018 adjusting the VIAC’s procedural framework to the current demands in international arbitration.

      In 2018, the China International Economic and Trade Arbitration Commission (CIETAC) – one of the oldest and most influential arbitration institutions in China – opened an arbitration centre in Vienna. The establishment of the arbitration centre is aimed at deepening the economic and trade cooperation between China and the EU.

      Besides the VIAC and the CIETAC, there are also some smaller organisations providing services with regard to the administration of arbitration proceedings (eg, Vienna Bar Association). However, these arbitration bodies normally only deal with smaller domestic disputes.

  5. 5.Foreign institutions
    Can foreign arbitral providers operate in your jurisdiction?
    1. Foreign and international arbitration institutions may freely administer disputes and provide their arbitration services in Austria. The International Chamber of Commerce is permanently represented in Vienna. It serves as appointing authority, provides advice on drafting arbitration clauses and promotes arbitration as a dispute resolution mechanism.

  6. 6.

    Courts
    Is there a specialist arbitration court? Is the judiciary in your jurisdiction generally familiar with, and supportive of, the law and practice of international arbitration?

    1. Since the amendment of the Austrian Arbitration Law in 2013, a division of the Austrian Supreme Court consisting of reputable judges specialised in arbitration has been designated to rule on almost all arbitration-related issues and most importantly on challenges against arbitrators and on applications to set aside arbitral awards. Since the Supreme Court is the first and last instance to hear such cases, proceedings in support of arbitration proceedings are of short duration. The establishment of one single division dealing with nearly all arbitration-related matters contributes to the effectiveness of arbitration in Austria. In most instances, the Austrian Courts, whether in order to support arbitration proceedings or in the enforcement stage, are very arbitration friendly and support the general aim of arbitration proceedings – a swift and efficient resolution of disputes.

      However, it should be noted that there are limited matters that do not fall within the exclusive competence of the Austrian Supreme Court (eg, consumer to business disputes and labour law matters).

    Agreement to arbitrate

  7. 7.Formalities
    What, if any, requirements must be met if an arbitration agreement is to be valid and enforceable under the law of your jurisdiction? Can an arbitration agreement cover future disputes?
    1. For an arbitral agreement to be valid, it must meet certain minimum requirements on content and form.

      The agreement must identify the parties, making them at least definable (in order to avoid possible discussions in this regard it is prudent to add the commercial register number of each party and the names of the companies in the original script, eg Cyrillic script); it must indicate the parties will to be bound by the arbitration agreement; and it must refer to a "specified legal relationship", ie to a specific dispute or to any potential dispute arising from a specified legal relationship. Therefore, arbitral agreements may cover future disputes as well as disputes that have already arisen.

      The document containing the arbitral agreement must bear the signatures respectively the electronic signatures of the parties. However, if a contract, fulfilling the form requirements for arbitration agreements makes reference to a separate document that is not signed by the parties and contains an arbitration agreement, the agreement to arbitrate in the referred document is considered valid. This is significant for arbitration clauses contained in general terms and conditions. An arbitral agreement may also be validly concluded by any means of communication proving both the offer to arbitrate and the acceptance thereof.

      Parties should also need to be aware about Austrian particularities in relation to the requirements of representation for the signature of an arbitration agreement. It is very common that contracts and thereby the arbitration agreements contained therein, are not exclusively negotiated and signed by the managing director of a company, but rather by an agent. According to Austrian jurisprudence, an agent can only validly sign an arbitration agreement if he has been granted a special written power of attorney by the principal that expressly entitles the agent to enter into arbitration agreements.

      However, not every agent needs such special power of attorney. If the principle grants the agent a "commercial power of attorney" as defined in section 54(1) Austrian Act on Commerce, or the "Prokura" (a power of attorney granted by an entrepreneur and registered with the Commercial Register), the agent is entitled to conclude arbitration agreements without a special power of attorney.

      Invalid arbitration agreements lack legal effect with consequences for the jurisdiction of the arbitral tribunal and the proceedings based on such an invalid agreement. However, if a party has entered into the arbitration proceedings without raising an objection on jurisdiction in its first submission, it is generally barred from raising this objection at a later stage.

      With regard to form requirements it needs to be noted that consumers as well as employees enjoy special protection under Austrian law. Arbitration agreements between consumers/employees and entrepreneurs/employer can be validly entered into only after the dispute has arisen and the consumer/employee has been given written advice on the difference between arbitration and court proceedings. Moreover, the arbitration agreement must be contained in a separate document and must specify the seat of the arbitral tribunal. The seat must be at the consumer’s or employee’s domicile, residence or place of employment at the time of the conclusion of the arbitral agreement or at the time the claim becomes pending or otherwise the entrepreneur/employer will be prevented from relying on the arbitration agreement.

  8. 8.Arbitrability
    Are any types of dispute non-arbitrable? If so, which?
    1. In principle, all pecuniary disputes are arbitrable. In particular, this includes disputes over anti-trust and competition claims and corporate disputes. Non-pecuniary disputes are only arbitrable if their subject matter may become the subject of a legal settlement under Austrian law. Pursuant to section 582(2) ACCP, matters of family law are not arbitrable. The same is true with respect to claims regarding contracts to which the Landlord and Tenant Act or the Limited Profit Housing Act apply and all claims relating to condominium property. Furthermore, section 9(2) of the Labour and Social Courts Act renders matters of social security law and disputes arising out of collective labour agreements non-arbitrable.

  9. 9.Third parties
    Can a third party be bound by an arbitration clause and, if so, in what circumstances? Can third parties participate in the arbitration process through joinder or a third-party notice?
    1. With respect to universal succession, the Austrian Supreme Court has ruled that an arbitral agreement binds the parties’ heirs. This has also been confirmed for the universal successors of a company after a merger, a spin-off or a transformation of a company’s legal form.

      Regarding singular succession, it is in principle accepted that an arbitration agreement between a debtor and an assignor of a claim is binding for the assignee. Generally, the same is true for de lege subrogation and redemption of debt. Similarly, the Austrian Supreme Court has confirmed that an arbitration agreement is binding to the "new" debtor in a contract on the assumption of debt and to the new parties after a contract is transferred. Also, where a contract confers benefits to a third party, the latter may not accept the benefits without the arbitration agreement.

      Austrian arbitration law does not expressly govern joinder of third parties. However, in scholarly doctrine it is argued that a third party, may intervene in arbitral proceedings which may impact its legal sphere, provided that the parties to the arbitration agreement and the arbitral tribunal give their consent.

      The Vienna Rules provide for a comprehensive framework for this purpose. Each party and the third party in question may request a joinder at any stage of the proceedings. Whether the request will be granted is within the discretion of the arbitral tribunal. Before deciding the issue, it must hear the parties and the third party to be joined.

  10. 10.Consolidation
    Would an arbitral tribunal with its seat in your jurisdiction be able to consolidate separate arbitral proceedings under one or more contracts and, if so, in what circumstances?
    1. Consolidation of arbitral proceedings is not expressly governed by Austrian arbitration law. In doctrine it is argued that it is permissible, provided that the parties and the arbitrators have given their consent. Under the Vienna Rules, the VIAC Board may decide to consolidate two or more proceedings, provided that the seat of arbitration in all of the arbitration agreements on which claims are based is identical and the parties agree to the consolidation or the same arbitrators were nominated or appointed. Before deciding upon a consolidation request, the VIAC Board has to hear all parties and already appointed arbitrators with respect to all relevant circumstances.

  11. 11.

    Groups of companies
    Is the "group of companies doctrine" recognised in your jurisdiction?

    1. Where an arbitration agreement has been signed by only one of the companies forming a group, the “group of companies doctrine” provides that the agreement binds any other company of the same group which has participated at the conclusion, performance or termination of the contract.

      Austrian law remains silent on this issue and the Austrian Supreme Court has not had yet the opportunity to deal with this matter. 

      However, in light of the fact that Austrian courts are generally rather reluctant to bind third parties to an arbitration agreement (see question 9), it seems unlikely that the group of companies doctrine as developed by the French doctrine would be applied by the Austrian Supreme Court. However, it might not even be necessary to rely on this doctrine in order to come to the conclusion that another company of the same group is bound by the arbitration agreement, as in cases were other companies are involved in the execution of a contract it might be argued – depending on the facts of the case – that such other company “joined” the contract that contains the arbitration clause.

  12. 12.Separability
    Are arbitration clauses considered separable from the main contract?
    1. Austrian law does not contain an express provision which establishes that an arbitration clause is separable from the main contract. There are some scholars that argue that the separability doctrine is inherent to Austrian law. However, the Austrian Supreme Court does not generally accept the doctrine of separability, rather the issue whether the arbitration clause remains valid in cases of termination or nullity of the contract containing such a clause is seen as an issue of contract interpretation and is decided on a case-by-case basis. Therefore, it is necessary to examine the parties’ intentions at the time when the agreement was signed in order to determine whether the invalidity or voidness of the main contract results in invalidity or voidness of the arbitration agreement. In light of the arbitration friendly stance taken by the Austrian courts, such interpretation will lead in most instances to the conclusion that the parties also wanted to arbitrate any dispute in relation to the invalidity or voidness of the main contract.

  13. 13.Competence-competence
    Is the principle of competence-competence recognised in your jurisdiction? Can a party to an arbitration ask the courts to determine an issue relating to the tribunal’s jurisdiction and competence?
    1. The principle of competence-competence vests the arbitral tribunal with the power to rule on its own jurisdiction. It is widely acknowledged in international arbitration and expressly enshrined in the ACCP. However, a party may request the Austrian Supreme Court to set aside the arbitral tribunal’s decision with regard to its jurisdiction once it has rendered an award on jurisdiction if it considers that the arbitral tribunal has wrongly confirmed or rejected its jurisdiction. Where the tribunal has rendered an award solely on jurisdiction and has confirmed its competence to arbitrate the dispute, the tribunal may continue with the conduct of the arbitral proceedings on the remaining issues, despite the fact that a party has initiated proceedings to set-aside the award on jurisdiction.

  14. 14.Drafting
    Are there particular issues to note when drafting an arbitration clause where your jurisdiction will be the seat of arbitration or the place where enforcement of an award will be sought?
    1. The will of the parties to finally submit their dispute to arbitration must be clearly and unambiguously stated in the arbitration agreement. The Austrian Supreme Court has therefore ruled that a dispute resolution clause providing that the parties should “aim” to resolve their disputes through arbitration does not represent a sufficiently clear expression of their will to arbitrate.

      However, the Austrian Supreme Court has adopted an arbitration-friendly approach and has confirmed the validity of arbitration clauses in cases of doubt. Should an arbitration agreement allow two possible interpretations, the interpretation that validates the arbitration agreement is to be preferred.

      A power of attorney authorising the agent to enter into arbitration agreements on behalf of the principal must meet specific formal requirements. Special requirements apply also to arbitral agreements between consumers and entrepreneurs and between employees and employers. See also the answer to question 7.

  15. 15.Institutional arbitration
    Is institutional international arbitration more or less common than ad hoc international arbitration? Are the UNCITRAL Rules commonly used in ad hoc international arbitrations in your jurisdiction?
    1. Arbitral proceedings in Austria are usually administered by an arbitral institution and governed by its respective rules of arbitration. Where the parties have agreed to submit their dispute to an ad hoc arbitration, it is, according to our experience, typically conducted under the UNCITRAL Rules.

  16. 16.Multi-party agreements
    What, if any, are the particular points to note when drafting a multi-party arbitration agreement with your jurisdiction in mind? In relation to, for example, the appointment of arbitrators.
    1. Apart from the requirement that the arbitration agreement applies to all parties to the arbitration, all the parties must be granted the right to be heard. This has particular implications in the appointment process of arbitrators. Generally, parties are free to agree on a special procedure regarding the constitution of the arbitral tribunal.

      Where two or more parties share one side in an arbitration (eg, the one of the respondents), section 587(5) ACCP requires them to jointly appoint one of the arbitrators and provides that any party to the arbitration is entitled to apply to the Austrian Supreme Court to step in and appoint an arbitrator, should they fail to do so within four weeks upon their notification. Such substitute appointment for one side does not automatically lead to a substitute appointment for the other side. Rather, the fact that the other side is not able to agree on an arbitrator, has no impact on the other parties’ right to appoint its own arbitrator. Hence, when drafting a multi-party arbitration agreement, it is not strictly necessary to follow the rules laid down in the Dutco decision (in case a party is in default with the appointment of its arbitrator, all members of the tribunal will be appointed by the appointing authority). However, it might be advisable to follow the Dutco Rule as otherwise there might be issues in enforcing the award in certain countries.

    Commencing the arbitration

  17. 17.Request for arbitration
    How are arbitral proceedings commenced in your jurisdiction? Are there any key provisions under the arbitration laws of your jurisdiction relating to limitation periods of which the parties should be aware?
    1. According to the ACCP, the request for arbitration should be in writing and should contain a reference to the relevant arbitration agreement and indicate the claims it raises in sufficient detail (the future respondent must be aware about the subject matter in dispute).

      In ad hoc arbitrations, the arbitral proceeding is typically commenced once the respondent receives the request for arbitration. The service of the request for arbitration in most instances – however, depending on the applicable substantive law – also constitutes the point in time when the statute of limitation is interrupted (in case the claims have been specified with sufficient detail). This is true even where the claimant has not yet appointed an arbitrator.

      Institutional arbitral proceedings are usually commenced by filing the request for arbitration with institution. Pursuant to the Vienna Rules, proceedings are deemed pending upon receipt of the request for arbitration by the Secretariat. The Vienna Rules require a complete request for arbitration containing information about the parties, a statement of facts, the request for relief, a statement regarding the number of arbitrators, information with respect to the arbitration agreement and an appointment of an arbitrator or an application that an arbitrator be appointed by the Board. Thus, they differ from the rules of other institutions where a mere "notice of arbitration" is sufficient (ie, a notice which may be subsequently supplemented once the arbitral tribunal is established).

    Choice of law

  18. 18.Choice of law
    How is the substantive law of the dispute determined? Where the substantive law is unclear, how will a tribunal determine what it should be?
    1. Pursuant to section 603 ACCP, the parties are free to choose the applicable statutory provisions or “rules of law” (eg UNIDROIT Principles of International Commercial Contracts). Moreover, the parties can empower the arbitral tribunal to decide ex aequo et bono or as amiable compositeur. In the absence of such an agreement, it is within the discretion of the arbitral tribunal to choose the statutory provisions it deems appropriate.

    Appointing the tribunal

  19. 19.Choice of arbitrators
    Does the law of your jurisdiction place any limitations in respect of a party’s choice of arbitrator?
    1. Austrian law only requires that arbitrators are natural persons and have full legal capacity. Naturally, arbitrators must be independent and impartial and remain so throughout the proceedings. Expect from these, there are no further general requirements to act as an arbitrator (eg, admission to the bar), if there is no agreement of the parties to the contrary.

      It is, however, noteworthy that state court judges on active duty are prevented from serving as arbitrators under the disciplinary laws that govern their profession.

  20. 20.Foreign arbitrators
    Can non-nationals act as arbitrators where the seat is in your jurisdiction or hearings are held there? Is this subject to any immigration or other requirements?
    1. Apart from the usual requirements to travel to Austria, such as the requirement of a travelling visa for non-European Union citizens, Austrian law does not provide for any restrictions with regard to non-national arbitrators.

  21. 21.Default appointment of arbitrators
    How are arbitrators appointed where no nomination is made by a party or parties or the selection mechanism fails for any reason? Do the courts have any role to play?
    1. According to the ACCP, the parties may agree on a specific appointment procedure (eg agreement on the rules of an arbitration institution or appointment by a specific appointing authority). In the absence of such agreement, any party may request the Austrian Supreme Court to step in and appoint an arbitrator where the parties themselves have failed to do so within four weeks after receipt of a written notification of the other party requesting for the appointment of an arbitrator.

      The same is true where the party-appointed arbitrators fail to agree on the appointment of the chairman of the arbitral tribunal.

  22. 22.Immunity
    Are arbitrators afforded immunity from suit under the law of your jurisdiction and, if so, in what terms?
    1. In the absence of any other arrangement, an arbitrator may be liable for any damage suffered by the parties due to a “wrongful refusal or delay”. This includes cases where the arbitrator issues a non-award or the award is set aside owing to the arbitrator’s gross negligence. Arbitrators are also liable for damages suffered owing to their unjustified resignation and where they justifiably resign or get successfully challenged for reasons they should have disclosed. Procedural errors and incorrect decisions on the merits will, in principle, not give rise to any liability unless such errors are the result of at least gross negligent behaviour of the arbitrator and only if the arbitral award has been successfully set aside.

  23. 23.Securing payment of fees
    Can arbitrators secure payment of their fees in your jurisdiction? Are there fundholding services provided by relevant institutions?
    1. Austrian arbitration law does not provide for any particular mechanism designed to secure the arbitrator’s fees. In the absence of institutional rules or other arrangements governing this issue, the arbitrators typically request the parties to provide an advance on their costs at the outset of arbitration proceedings.

      The Vienna Rules expressly govern the advance on arbitrators’ costs and provide that by agreeing to the Vienna Rules, the parties mutually agree to pay their equal shares into an account held by the VIAC. The payment of the advance is to be made before the file is transferred to the arbitral tribunal. If one of the parties fails to pay its share of the advance on costs, the Secretary General of the VIAC must request the other party to cover the outstanding amount. The arbitral tribunal has the power to order (eg, by rendering an award or other appropriate form) the party in default to reimburse its share of the advance on costs paid by the opposing party. In case the advance on costs is not paid in full, the Secretary General may declare the proceedings terminated.

    Challenges to arbitrators

  24. 24.Grounds of challenge
    On what grounds may a party challenge an arbitrator? How are challenges dealt with in the courts or (as applicable) the main arbitration institutions in your jurisdiction? Will the IBA Guidelines on Conflicts of Interest in International Arbitration generally be taken into account?
    1. According to the ACCP and the Vienna Rules, arbitrators may only be challenged due to justifiable doubts as to their impartiality or independence or on the ground that they do not fulfil the qualifications agreed upon by the parties.

      Whether or not there are justifiable doubts as to the arbitrator’s independence and impartiality is to be examined from an objective perspective (ie from the perspective of a reasonable third person). While the IBA Guidelines on Conflicts of Interest in International Arbitration – absent an agreement of the parties to the contrary – are not directly applicable to determine whether there are justifiable doubts as to the impartiality of independence of an arbitrator, they are nevertheless used as an indicator by arbitration institutions as well as by the Austrian Supreme Court. Such application is based on the fact that they constitute a widespread international consensus on this topic and can therefore give very helpful indications as to the interpretation of the terms of independence and impartiality.

      According to the ACCP, a party may challenge an arbitrator within four weeks from the constitution of the arbitral tribunal or from the day it gained knowledge of the ground for a challenge. Under the Vienna Rules, this time period is reduced to just 15 days from the date the party that raises the challenge learned about the respective circumstances.

      Under the ACCP, unless the challenged arbitrator steps down or the other party agrees with the challenge, the arbitral tribunal, including the challenged arbitrator, will decide on the motion. Where the proceedings are governed by the Vienna Rules, the decision on challenge will be made by the VIAC Board.

      If the challenge is rejected, the party may within four weeks request the Austrian Supreme Court to decide on its challenge. Even if such challenge is pending before the Austrian Supreme Court, the arbitral tribunal can continue the proceedings and even render an award.

    Interim relief

  25. 25.

    Types of relief
    What main types of interim relief are available in respect of international arbitration and from whom (the tribunal or the courts)? Are anti-suit injunctions available where proceedings are brought elsewhere in breach of an arbitration agreement?

    1. The ACCP authorises arbitral tribunals to order interim or protective measures upon a request by a party if they consider that otherwise the enforcement of the claim would be frustrated or significantly impeded and also where they consider that a risk of irreparable harm exists. Parties may also turn to a state court to request such measures. Therefore, generally, the parties are free to choose between the arbitral tribunal and state courts.

      Arbitral tribunals lack coercive powers and their decisions must be enforced by state courts. As a result, while tribunals may order types of interim relief that are unknown under Austrian law, enforcement courts in Austria will have to transform them into such interim measures that they are authorised to enforce and that come closest to the type of interim relief originally granted by the arbitral tribunal.

      Austrian law does not explicitly provide for anti-suit injunctions.

  26. 26.Security for costs
    Does the law of your jurisdiction allow a court or tribunal to order a party to provide security for costs?
    1. Austrian arbitration law does not expressly govern the issue of security for costs. Whether such measures may be ordered under section 593 ACCP, which governs interim measures, is still heavily discussed between scholars. However, the parties are in any way free to provide for security for costs in their arbitration agreements or by choosing institutional rules that allow for a security for costs.

    Procedure

  27. 27.

    Procedural rules
    Are there any mandatory rules in your jurisdiction that govern the conduct of the arbitration (eg, general duties of the tribunal and/or the parties)?

    1. Austrian arbitration law champions the principle of party autonomy and enables parties to deviate from most of its provision if they agree. Parties, however, may not validly waive their right to be heard or their rights to fair and equal treatment, to representation or to challenge an arbitrator or the arbitral award. Also, the principles of competence-competence, the uneven number of arbitrators and the tribunal’s authority to admit evidence are mandatory. Likewise, parties also may not deviate from the right to be notified about the initiation of the proceedings.

  28. 28.Refusal to participate
    What is the applicable law (and prevailing practice) where a respondent fails to participate in an arbitration?
    1. If a party refuses or for any other reason fails to participate in the arbitration, the arbitral tribunal shall continue with the proceedings but may not treat this omission as consent to the other party’s assertions. Also, the tribunal may review the reasons for the default and if it considers it justified, it may order that the omitted act be subsequently carried out.

  29. 29.

    Admissible evidence
    What types of evidence are usually admitted, and how is evidence usually taken? Will the IBA Rules on the Taking of Evidence in International Arbitration generally be taken into account?

    1. The ACCP vests the arbitral tribunal with the power to rule on the admissibility of evidence, to carry out the taking of evidence and to evaluate the results. The arbitral tribunal must, however, adhere to the principles of fair treatment of the parties and the right to be heard. Therefore, parties must be granted an opportunity to submit evidence, participate in the taking of evidence and comment on the results thereof. Also, all evidence produced to the tribunal by one of the parties must, in principle, be communicated to the other party.

      The tribunal thereby enjoys wide discretionary powers. The Vienna Rules follow the same approach and also expressly vest the tribunal with the authority to request the parties to submit evidence. Factual, witness, expert and documentary evidence are commonly admitted and can usually be presented in either written or oral form. In our experience the IBA Rules on the Taking of Evidence in International Commercial Arbitration – especially in international cases – usually serve as a guideline for the arbitral tribunal in determining how evidence is to be gathered (the parties, however, often agree that these rules cannot serve as a guideline when it comes to the issue of document production).

      For the time being, we do not expect that the Prague Rules will replace the IBA Rules. However, it seems to be likely that arbitral tribunals in the future will take guidance from both sets of rules to provide tailor-made solutions for the resolution of the dispute to be decided by them.

  30. 30.Court assistance
    Will the courts in your jurisdiction play any role in the obtaining of evidence?
    1. The ACCP authorises arbitral tribunals or a party with the approval of the arbitral tribunal to request judicial assistance in the taking of evidence from Austrian courts (eg taking of witness evidence). This provision also applies to arbitrations that are not seated in Austria. However, the requested judicial act must be one that the arbitral tribunal cannot carry out by itself and the requested type of assistance must not violate Austrian public policy. Provided that this is indeed the case, the competent court must grant the judicial act without examining its usefulness or suitability.

  31. 31.Document production
    What is the relevant law and prevailing practice relating to document production in international arbitration in your jurisdiction?
    1. Subject to a party agreement on this matter, the wide powers of discretion enjoyed by the arbitral tribunal in the process of taking of evidence also apply to the question whether document production shall take place or not. Austrian arbitration law and the Vienna Rules avoid specifying which methods of document production are permitted and which ones are not. Thus, they allow the tribunal to take into account the circumstances of the case and also the legal and cultural background of the parties.

      In practice, arbitral tribunals in structuring document production procedures take guidance from the IBA Rules on the Taking of Evidence in International Arbitration.

  32. 32.Hearings
    Is it mandatory to have a final hearing on the merits?
    1. If the parties have not provided to the contrary, it falls in the discretionary power of the arbitral tribunal to decide whether to hold an oral hearing. However, a party’s request to hold a hearing must be granted by the tribunal in case there is no agreement that the proceedings are to be conducted in written form. Should the arbitral tribunal disregard such request, the award can be set aside.

  33. 33.

    Seat or place of arbitration
    If your jurisdiction is selected as the seat of arbitration, may hearings and procedural meetings be conducted elsewhere?

    1. Under Austrian law – absent another agreement by the parties – hearings and procedural meetings can be conducted at any place the arbitral tribunal deems appropriate.

    Award

  34. 34.Majority decisions
    Can the tribunal decide by majority?
    1. Generally, in line with international practice, the arbitral tribunal decides by a simple majority of its members, which also corresponds with article 29 of the UNICTRAL Model Law. Parties, however, are free to agree on a different decision-making process. The Vienna Rules do not deviate from this standard. 

      If one or more of the arbitrators unjustifiably remain absent from the decision-making process, pursuant to section 604(2) ACCP, the vote may take place without them. However, the required simple majority must be calculated by the total of all arbitrators and not just of the ones who actually participate in the voting. Where the vote is for an arbitral award, the parties must be informed in advance of the arbitrators’ intention to find a majority in this particular manner (and thereby advising that one or more arbitrators are not participating in the vote).

  35. 35.Limitations to awards and relief
    Are there any particular types of remedies or relief that an arbitral tribunal may not grant?
    1. Apart from Austrian public policy, there are no restrictions in the type of relief that may be requested and granted. Austrian law regards this issue as a matter of substantive law.

  36. 36.Dissenting arbitrators
    Are dissenting opinions permitted under the law of your jurisdiction? If so, are they common in practice?
    1. Austrian arbitration law does not expressly govern dissenting opinion but it does provide that if an arbitrator’s signature is missing from the final award, the president of the arbitral tribunal must explain the reasons of its absence. This has been regarded by some authors as an indication that a dissenting opinion is permitted. Others argue that dissenting opinions are in breach of the confidentiality of the deliberations and the vote of the arbitral tribunal.

      The Austrian Supreme Court has not yet ruled whether dissenting opinions are allowed under Austrian law. However, it should be noted the Austrian Supreme Court has already held that the dissenting opinions do not form part of the arbitral award.

  37. 37.Formalities
    What, if any, are the legal and formal requirements for a valid and enforceable award?
    1. An arbitral award has to be in writing and it has to bear the signatures of all arbitrators. If an arbitrator is prevented from signing the award for longer than just a brief period of time, the signatures of the majority of the arbitrators would suffice, provided that the reasons for the omission of the signature are recorded in the award by one of the other arbitrators.

      The award must also state its date and the place where it was made.

      Furthermore, the award must state the names of the members of the arbitral tribunal and indicate the parties. It must contain a decision on the claims granting a clearly determined relief and, unless otherwise agreed by the parties, it shall state the reasons for the decision.

  38. 38.Time frames
    What time limits, if any, should parties be aware of in respect of an award? In particular, do any time limits govern the interpretation and correction of an award?
    1. Austrian arbitration law does not provide for a time limit for rendering an arbitral award thus allowing parties to specify this in their arbitration agreement.

      Once the award is received by the parties, a period of four weeks starts running during which a party may request the arbitral tribunal to correct the award and supplement it with respect to claims raised during the proceedings but not resolved by the tribunal. The same period applies to party requests to the tribunal to explain certain parts of the award, provided that the parties have agreed to allow such requests.

      The receipt of the award by the parties also triggers a time period of three months during which the parties may challenge it before the Austrian courts.

    Costs and interest

  39. 39.

    Costs
    Are parties able to recover fees paid and costs incurred? Does the "loser pays" rule generally apply in your jurisdiction?

    1. The ACCP grants the parties autonomy with respect to the allocation of costs. In the absence of an agreement, the ACCP vests the arbitral tribunal with a wide-range of discretionary powers requiring it to consider the circumstances of the case and the outcome of the proceedings. The decision on the costs, however, must not violate Austrian public policy. In practice, the costs follow the event rule plays an important role in the determination of how costs will be allocated.

      Reimbursement of the costs may be granted for all reasonable and appropriate costs. This would typically include the costs for party representation before the arbitral tribunal, the advance on costs provided by the parties, experts’ fees and expenses. Similarly, reimbursable costs may be incurred by witnesses for their attendance at the oral hearings or by the parties for the preservation or taking of evidence. In principle, also the internal costs of a party are recoverable. However, there is no clear delimitation on what actually constitutes in-house costs in connection with the arbitration proceedings.

      The Vienna Rules do not provide for any restrictions as to the allocation of costs by the arbitral tribunal, thus allowing for maximum flexibility.

  40. 40.Interest on the award
    Can interest be included on the principal claim and costs? Is there any mandatory or customary rate?
    1. Austrian arbitration law allows the arbitral tribunal to grant interest.

      In general, Austrian law treats the issue of interest as a matter of substantive law. Section 1000 of the Austrian Civil Code provides for a rate of 4 per cent, which applies to contractual relationships. The interest rate for commercial transactions, however, is governed by section 456 of the Austrian Act on Commerce, which provides for an increased rate of 9.2 per cent above the base lending rate. With respect to compound interest, section 1000(2) of the Austrian Civil Code provides for an interest rate of 4 per cent, which applies both to general contractual transactions and to commercial transactions. Neither of these rates is mandatory but deviating party agreements must not violate Austrian public policy.

    Challenging awards

  41. 41.Grounds for appeal
    Are there any grounds on which an award may be appealed before the courts of your jurisdiction?
    1. At the outset it should be clarified that Austrian law does not provide for any appeal proceedings against arbitration awards. However, under specific circumstances it is possible to take recourse against the arbitral award. Section 611(2) No.1 to 8 ACCP provides an exhaustive list of grounds for setting aside arbitral award:

      • a valid arbitration agreement does not exist or one of the parties was incapable of concluding a valid arbitration agreement under the law that governs its personal status, or the arbitral tribunal has denied its jurisdiction;
      • a party was not properly notified of the arbitral proceedings or of the appointment of an arbitrator or for another reason was unable to presents its case;
      • the award includes a decision on a dispute or an issue that is not covered by the arbitration agreement or by the parties’ requests;
      • the composition or constitution of the arbitral tribunal was in breach of party agreement on this issue or in breach of the applicable ACCP provisions;
      • a violation of public policy (ie, the manner in which the arbitral proceedings were conducted is in conflict with the fundamental values of Austrian law (procedural public policy));
      • the grounds have been met for which an action for revision under section 530(1) No. 1 to 5 ACCP may be filed against a court judgment;
      • non-arbitrability of the subject matter of the dispute under Austrian law; and
      • the arbitral award itself is in conflict with fundamental values of the Austrian legal system (substantive public policy).

      When deciding whether one of the reasons for setting aside an arbitral award is given, the Austrian courts are not allowed to conduct a révision au fond (ie they are not allowed to revise the factual and legal basis of the award).

  42. 42.Other grounds for challenge
    Are there any other bases on which an award may be challenged, and if so what?
    1. The list in section 611(2) ACCP is exhaustive. There are no other grounds for setting aside an arbitral award.

      However, pursuant to section 612 ACCP, a request may be brought before the Austrian Supreme Court to establish the existence or non-existence of an arbitral award. Notably, such an action does not aim at setting aside an award but in achieving legal certainty as to the nature of the relevant decision. This is particularly relevant with respect to the so-called “non-awards” (ie, decisions that do not meet the minimum requirements of an arbitral award).

  43. 43.Modifying an award
    Is it open to the parties to exclude by agreement any right of appeal or other recourse that the law of your jurisdiction may provide?
    1. Parties may not validly agree to expand the list of grounds for challenging an arbitral award by adding new grounds. Neither may they waive any of these grounds in advance. The grounds set out in section 611(2) No.7 and 8 ACCP (ie, non-arbitrability of the subject matter of the dispute and violations of substantive public policy) must be examined by the courts ex officio and the parties may not validly agree to exclude them even after they have received the arbitral award.

    Enforcement in your jurisdiction

  44. 44.Enforcement of set-aside awards
    Will an award that has been set aside by the courts in the seat of arbitration be enforced in your jurisdiction?
    1. The Austrian courts have not yet decided whether the successful challenge of an arbitral award abroad constitutes a ground for refusing its enforcement.

  45. 45.Trends
    What trends, if any, are suggested by recent enforcement decisions? What is the prevailing approach of the courts in this regard?
    1. Generally, Austrian courts have maintained a positive approach towards the enforcement of awards. In most cases so far, Austrian courts have allowed the enforcement of international arbitral awards.

  46. 46.State immunity
    To what extent might a state or state entity successfully raise a defence of state or sovereign immunity at the enforcement stage?
    1. The theory of restricted immunity is recognised in Austria. In contrast to the theory of absolute immunity, it only grants other states and state entities protection from prosecution with respect to their acts in their capacity and function as states or state entities. In relation to enforcement proceedings this theory therefore restricts the enforcement against sovereign assets. However, an award can be enforced against assets in Austria that have a commercial, non-sovereign use.

    Further considerations

  47. 47.Confidentiality
    To what extent are arbitral proceedings in your jurisdiction confidential?
    1. Austrian arbitration law does not provide for a specific duty to keep the arbitral proceedings confidential. Failing a clear party agreement, whether or not such a duty may be derived from the arbitration agreement must be examined on a case-by-case basis and taking into account not just the arbitration agreement but also the main contract from which the dispute arises.

      Parties are therefore well advised to agree on a clause governing confidentiality or to choose a set of institutional rules that unambiguously deal with this issue. The Vienna Rules stipulate a duty of the arbitrators to keep confidential all information they have acquired in the exercise of their mandate.

  48. 48.Evidence and pleadings
    What is the position relating to evidence produced and pleadings filed in the arbitration? Are these confidential? Is there any way that they might be relied on in other proceedings (whether arbitral or court proceedings)?
    1. As outlined in question 47 there is no general confidentiality obligation. Hence, a party in principle can submit evidence obtained during the arbitration also in other arbitral or court proceedings.

  49. 49.Ethical codes
    What ethical codes and other professional standards, if any, apply to counsel and arbitrators conducting proceedings in your jurisdiction?
    1. Austrian law does not provide for specific ethical codes governing the conduct of arbitration practitioners in particular. However, the Professional Code of Conduct for Lawyers applies to all members of the Austrian Bar, and is therefore also applicable in cases where they act as arbitrators or counsel in an arbitration.

  50. 50.Procedural expectations
    Are there any particular procedural expectations or assumptions of which counsel or arbitrators participating in an international arbitration with its seat in your jurisdiction should be aware?
    1. Austria offers parties, counsels and arbitrators a modern and sophisticated arbitration law. It provides a reliable arbitral institution with long experience that is aware of international trends and ready to adjust its rules to keep them in line with best practice. Austria is also home to a vibrant community of internationally renowned arbitration specialists and scholars.

      Austria is therefore widely regarded as an arbitration-friendly jurisdiction.

  51. 51.

    Third-party funding
    Is third-party funding permitted in your jurisdiction? If so, are there any rules governing its use?

    1. Austrian arbitration law does not expressly govern third-party funding in arbitration and the Austrian Supreme Court has not yet had the opportunity to rule on the issues it raises. However, in practice, third-party funding is widely used and does it seem hard to conceive any grounds under Austrian law that would prohibit third-party funding. As Austrian law does not govern third-party funding, there are also no rules that would require a party to disclose the existence and identity of funders. 

Interested in contributing to this Know-how?

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GAR know-how provides reliable cross-jurisdictional insight to help cement the building blocks of international practice. In this section, select experienced practitioners answer commonly asked questions for key jurisdictions so allowing readers to be better-placed to solve the challenges of their working days.

Questions

    Infrastructure

  1. 1.The New York Convention
    Is your state a party to the New York Convention? Are there any noteworthy declarations or reservations?
  2. 2.Other treaties
    Is your state a party to any other bilateral or multilateral treaties regarding the recognition and enforcement of arbitral awards?
  3. 3.National law
    Is there an arbitration act or equivalent and, if so, is it based on the UNCITRAL Model Law? Does it apply to all arbitral proceedings with their seat in your jurisdiction?
  4. 4.Arbitration bodies in your jurisdiction
    What arbitration bodies relevant to international arbitration are based within your jurisdiction? Do such bodies also act as appointing authorities?
  5. 5.Foreign institutions
    Can foreign arbitral providers operate in your jurisdiction?
  6. 6.

    Courts
    Is there a specialist arbitration court? Is the judiciary in your jurisdiction generally familiar with, and supportive of, the law and practice of international arbitration?


  7. Agreement to arbitrate

  8. 7.Formalities
    What, if any, requirements must be met if an arbitration agreement is to be valid and enforceable under the law of your jurisdiction? Can an arbitration agreement cover future disputes?
  9. 8.Arbitrability
    Are any types of dispute non-arbitrable? If so, which?
  10. 9.Third parties
    Can a third party be bound by an arbitration clause and, if so, in what circumstances? Can third parties participate in the arbitration process through joinder or a third-party notice?
  11. 10.Consolidation
    Would an arbitral tribunal with its seat in your jurisdiction be able to consolidate separate arbitral proceedings under one or more contracts and, if so, in what circumstances?
  12. 11.

    Groups of companies
    Is the "group of companies doctrine" recognised in your jurisdiction?


  13. 12.Separability
    Are arbitration clauses considered separable from the main contract?
  14. 13.Competence-competence
    Is the principle of competence-competence recognised in your jurisdiction? Can a party to an arbitration ask the courts to determine an issue relating to the tribunal’s jurisdiction and competence?
  15. 14.Drafting
    Are there particular issues to note when drafting an arbitration clause where your jurisdiction will be the seat of arbitration or the place where enforcement of an award will be sought?
  16. 15.Institutional arbitration
    Is institutional international arbitration more or less common than ad hoc international arbitration? Are the UNCITRAL Rules commonly used in ad hoc international arbitrations in your jurisdiction?
  17. 16.Multi-party agreements
    What, if any, are the particular points to note when drafting a multi-party arbitration agreement with your jurisdiction in mind? In relation to, for example, the appointment of arbitrators.
  18. Commencing the arbitration

  19. 17.Request for arbitration
    How are arbitral proceedings commenced in your jurisdiction? Are there any key provisions under the arbitration laws of your jurisdiction relating to limitation periods of which the parties should be aware?
  20. Choice of law

  21. 18.Choice of law
    How is the substantive law of the dispute determined? Where the substantive law is unclear, how will a tribunal determine what it should be?
  22. Appointing the tribunal

  23. 19.Choice of arbitrators
    Does the law of your jurisdiction place any limitations in respect of a party’s choice of arbitrator?
  24. 20.Foreign arbitrators
    Can non-nationals act as arbitrators where the seat is in your jurisdiction or hearings are held there? Is this subject to any immigration or other requirements?
  25. 21.Default appointment of arbitrators
    How are arbitrators appointed where no nomination is made by a party or parties or the selection mechanism fails for any reason? Do the courts have any role to play?
  26. 22.Immunity
    Are arbitrators afforded immunity from suit under the law of your jurisdiction and, if so, in what terms?
  27. 23.Securing payment of fees
    Can arbitrators secure payment of their fees in your jurisdiction? Are there fundholding services provided by relevant institutions?
  28. Challenges to arbitrators

  29. 24.Grounds of challenge
    On what grounds may a party challenge an arbitrator? How are challenges dealt with in the courts or (as applicable) the main arbitration institutions in your jurisdiction? Will the IBA Guidelines on Conflicts of Interest in International Arbitration generally be taken into account?
  30. Interim relief

  31. 25.

    Types of relief
    What main types of interim relief are available in respect of international arbitration and from whom (the tribunal or the courts)? Are anti-suit injunctions available where proceedings are brought elsewhere in breach of an arbitration agreement?


  32. 26.Security for costs
    Does the law of your jurisdiction allow a court or tribunal to order a party to provide security for costs?
  33. Procedure

  34. 27.

    Procedural rules
    Are there any mandatory rules in your jurisdiction that govern the conduct of the arbitration (eg, general duties of the tribunal and/or the parties)?


  35. 28.Refusal to participate
    What is the applicable law (and prevailing practice) where a respondent fails to participate in an arbitration?
  36. 29.

    Admissible evidence
    What types of evidence are usually admitted, and how is evidence usually taken? Will the IBA Rules on the Taking of Evidence in International Arbitration generally be taken into account?


  37. 30.Court assistance
    Will the courts in your jurisdiction play any role in the obtaining of evidence?
  38. 31.Document production
    What is the relevant law and prevailing practice relating to document production in international arbitration in your jurisdiction?
  39. 32.Hearings
    Is it mandatory to have a final hearing on the merits?
  40. 33.

    Seat or place of arbitration
    If your jurisdiction is selected as the seat of arbitration, may hearings and procedural meetings be conducted elsewhere?


  41. Award

  42. 34.Majority decisions
    Can the tribunal decide by majority?
  43. 35.Limitations to awards and relief
    Are there any particular types of remedies or relief that an arbitral tribunal may not grant?
  44. 36.Dissenting arbitrators
    Are dissenting opinions permitted under the law of your jurisdiction? If so, are they common in practice?
  45. 37.Formalities
    What, if any, are the legal and formal requirements for a valid and enforceable award?
  46. 38.Time frames
    What time limits, if any, should parties be aware of in respect of an award? In particular, do any time limits govern the interpretation and correction of an award?
  47. Costs and interest

  48. 39.

    Costs
    Are parties able to recover fees paid and costs incurred? Does the "loser pays" rule generally apply in your jurisdiction?


  49. 40.Interest on the award
    Can interest be included on the principal claim and costs? Is there any mandatory or customary rate?
  50. Challenging awards

  51. 41.Grounds for appeal
    Are there any grounds on which an award may be appealed before the courts of your jurisdiction?
  52. 42.Other grounds for challenge
    Are there any other bases on which an award may be challenged, and if so what?
  53. 43.Modifying an award
    Is it open to the parties to exclude by agreement any right of appeal or other recourse that the law of your jurisdiction may provide?
  54. Enforcement in your jurisdiction

  55. 44.Enforcement of set-aside awards
    Will an award that has been set aside by the courts in the seat of arbitration be enforced in your jurisdiction?
  56. 45.Trends
    What trends, if any, are suggested by recent enforcement decisions? What is the prevailing approach of the courts in this regard?
  57. 46.State immunity
    To what extent might a state or state entity successfully raise a defence of state or sovereign immunity at the enforcement stage?
  58. Further considerations

  59. 47.Confidentiality
    To what extent are arbitral proceedings in your jurisdiction confidential?
  60. 48.Evidence and pleadings
    What is the position relating to evidence produced and pleadings filed in the arbitration? Are these confidential? Is there any way that they might be relied on in other proceedings (whether arbitral or court proceedings)?
  61. 49.Ethical codes
    What ethical codes and other professional standards, if any, apply to counsel and arbitrators conducting proceedings in your jurisdiction?
  62. 50.Procedural expectations
    Are there any particular procedural expectations or assumptions of which counsel or arbitrators participating in an international arbitration with its seat in your jurisdiction should be aware?
  63. 51.

    Third-party funding
    Is third-party funding permitted in your jurisdiction? If so, are there any rules governing its use?