Please, fill out the form below to get a consultation on DD in Austria
user

Enter your name

user

Enter your E-mail

phone

Enter your phone number

comment

Performing DD in Austria 

Buying a business in Austria usually involves dealing with a number of operational, tax & legal issues. Success or failure of DD may depend on an industry a company is operating in & may also include handling strategic issues. So, let’s have a more indepth look at DD of Austrian companies is performed.

Purchasing a Business in Austria: Seller's Responsibility

A seller who fails to notify a buyer of an upcoming transaction may end up being accused of breaching their obligations or facing a lawsuit for recognizing a contract invalid or introducing amendments to it. Therefore, including a clause like this in an M&A agreement prior to closing an M&A deal in Austria is a common practice. However, it should be kept in mind that there’s a risk of the clause being challenged due to one of the parties acting deliberately.

Which Information on Companies is Publicly Accessible?

Some data can be obtained from open registers, so performing due diligence of Austrian companies may not necessarily entail the intention to buy a company in Austria. Information that is accessible to the general public is limited to:

  • database of insolvent companies;
  • commercial register;
  • land register.

Commercial registers contain information about:

  • managers;
  • shareholders of LLCs;
  • SVB members;
  • yearly reports;
  • essential corporate documents.

Please note that data on JSCs’ stakeholders is obtainable from a stakeholder register. 

Some information in corporate registers can be purely declarative (e.g. data on LLCs’ stakeholders), which is why it may not be reliable. Under EU legislation, Austrian companies may not disclose all information on financial statements if they qualify as small & medium entities.

The country’s land registry contains information on owners of a specific piece of land & any other registered rights. Searching for information about owners is only allowed under very rare circumstances. Therefore, researching legal owners of companies’ real estate during DD of Austrian companies should be complemented by other sources.

There’s also an insolvency database which contains data on whether individuals or companies have had insolvency proceedings initiated against them.

Importance of Concluding an M&A Contract in Austria

Performing DD of companies in Austria requires disclosing all information pertaining to it. If purchasers know of any shortcomings of a company in question, they aren’t allowed to make claims under Austria’s legislation. This is because such information wasn’t hidden from the purchaser & they were acquainted with it.

Legal Assistance With Concluding M&A Deals in Austria

Those wishing to purchase a business in Austria can do so by accessing information in public registers. However, to avoid any eventualities, potential purchasers are highly recommended to perform DD of companies in Austria before buying them. 

Need legal assistance with conducting due diligence procedure in Austria? Looking for legal advice on the conclusion of M&A deals in Austria? IQ Decision UK is always at your service.