Category: Austria

Herbst Kinsky has advised SoftBank Investment Advisers on a USD 120 million Series D investment round in Adverity, together with Sapphire Ventures.

Adverity is a Vienna-based developer of marketing analytics software. According to Herbst Kinsky, Adverity serves clients such as Ikea, Red Bull, Unilever, MediaCom, and Vodafone.

The Herbst Kinsky team was led by Philipp Kinsky, Felix Kernbichler, Philipp Herold, Beatrice Blumel, Angelika Kurz, and Christoph Ludvik.

The firm did not reply to our inquiry about the deal.

Karolin Andreewitch and Philipp Schrader have made Partner at E+H in Austria.

Andreewitch specializes in employment law, corporate transactions, and due diligence reviews. Andreewitch began her career in law as a legal assistant at Taylor Wessing in 2009. From 2010 to 2014 she worked at Wolf Theiss, Harnik & Finkelsten, and the Higher Regional Court of Vienna. She spent several months of 2014 as Project Collaborator at the Judicial Care Agency Vienna, before joining Schoenherr as an Associate in December of the same year. Finally, she joined E+H in 2017.

Schrader’s areas of expertise include capital markets and stock exchange issues, reorganizations/restructurings, and syndicate formation, among other fields. Prior to joining E+H in 2018, Schrader was with Kommunalkredit Austria from 2009 to 2010, Wolf Theiss from 2010 to 2012, and Judicial District of the Higher Regional Court of Vienna from 2013 to 2014. He spent another eight months of 2014 at Graf & Pitkowitz, before moving to Weber & Co. in October of that year. He moved from Weber & Co. to Spitzauer & Partner in 2017, where he stayed until joining E+H a year later.

“These two Partner appointments demonstrate E+H’s core values of expertise, performance, and team spirit,” commented Peter Winkler, Partner at E+H. “Karolin Andreewitch and Philipp Schrader have distinguished themselves in recent years precisely in these areas … we are particularly pleased to welcome two such collegial professionals as partners at E+H.”

PHH has advised Austrian Nuki Home Solutions and its existing shareholders on a EUR 20 million financing round which included existing investors Up to Eleven Digital Solutions GmbH, Venta, Fortuna, and new investor Cipio Partners.

Nuki, headquartered in Graz, has been developing smart door locks, that are controlled by smartphones, since 2014. 

As a result of the financing round, Cipio Partners acquired a 20% stake in Nuki. 

PHH’s team was led by Partner Rainer Kaspar and Lawyer Matthias Fucik and included Partner Nicolaus Mels-Colloredo, Counsel Daniela Olbrich, Lawyer Leopold Opferkuch, and Trainee Lawyer Johannes Metzler.

PHH did not reply to our inquiry on the matter. 

Herbst Kinsky has advised Austrian refurbished electrical product retailer Refurbed on its EUR 45.5 million Series B investment provided by Evli Growth Partners and Almaz Capital, as well as SevenVentures, Bonsai Partners, Speedinvest, and All Iron Ventures, among others. E+H advised SevenVentures on the deal.

Herbst Kinsky’s team consisted of Partner Florian Steinhart and Attorney-at-Law Magdalena Wagner.

The E+H team included Partners Clemens Lanschutzer, Helmut Liebel, and Alric Ofenheimer and Associates Pascal Haring, Wolfgang Kofer, Michael Staudinger, and Titus Kahr.

Binder Groesswang has advised BNP Paribas on the sale of Austria’s largest online broker Hello Bank! to Bawag P.S.K. Fellner Wratzfeld & Partner advised the buyer.

Closing is expected by the end of 2021.

According to Binder Groesswang, the “Austrian online brokerage business of Hello Bank! with more than 80,000 customers will be continued under the brand easybank in the future. The acquisition is intended to further expand the Bawag Group’s securities offering. The easybank brand is characterized by a high level of customer contact and satisfaction. The aim of the transaction is to combine the strengths of the two companies and to strengthen the core retail business.”

Binder Groesswang’s team included Partners Thomas Schirmer, Stephan Heckenthaler, Horst Lukanec, Markus Uitz, Christine Dietz, and Clemens Willvonseder, Senior Associates Christoph Schober, Attorney Manuel Mullner, and Associates Felix Fuith, Pia-Alena Havel, and Artan Duraku.

Fellner Wratzfeld & Partner’s team included Partners Markus Fellner, Paul Luiki, Lukas Flener, and Gregor Schett, Attorneys Roswitha Seekirchner, Peter Stiegler, Veronika Seronova, and Elisabeth Fischer-Schwarz, and Associates Mario Burger, Martin Navara, Roman Schlemaier, and Julia Berger.

To mint NFT art, you need to have enough cryptocurrency in your wallet (and even more to buy it). A successful NFT artist could then also pay his or her studio assistants in cryptocurrency from the proceeds of the sales. Cryptocurrency therefore plays an obvious part in a blockchain-based business. But is this also true from an employment law perspective? Can or should remuneration be paid in a cryptocurrency? Let’s take a closer look at this question by examining the interface between the crypto world and the physical world from an Austrian employment law perspective.

Austrian employment law does not explicitly define the term. Case law, however, regards as “remuneration” which the employer grants the employee in return for providing services. “Remuneration” therefore not only includes the regular salary, but also other (non-regular) payments and can generally be split into cash remuneration (Geldbezüge) and remuneration in kind (Sachbezüge).

The employee’s remuneration as such must generally be paid to the employee in cash (or by bank transfer – so-called cash payment requirement, Barzahlungsgebot). The background for this rule is that employees should be able to exchange their remuneration freely on the market for goods and services of their choice.

To the extent the applicable collective bargaining agreement does not include regulations on offsetting benefits in kind against the collective minimum salary, remuneration needs to be paid in cash (i.e. in a fiat currency). The parties can agree on supplementary payments in kind (another term is “natural wages”) by the employer.

In relation to cryptocurrencies, two questions remain: Is a cryptocurrency a currency under Austrian law, and can employees cover their living expenses if their remuneration is paid entirely in a cryptocurrency?

Cryptocurrency = a currency under Austrian law?

Prevailing doctrine argues that cryptocurrencies cannot be equated with traditional currencies such as the euro or dollar. This is usually justified by the lack of recognition as a payment method and the lack of compulsory acceptance in daily economic transactions. Therefore, cryptocurrencies are (currently) not to be qualified as currencies within the meaning of Austrian law.

Consequently, paying the employees’ entire salary in a cryptocurrency would not be compatible with the cash payment requirement. The employees could also not cover their living expenses by (solely) using cryptocurrencies they received as remuneration. At this point, you can’t go shopping at the supermarket using cryptocurrencies.

Risk of underpayment

In Austria, there is no legal minimum wage. However, mandatory minimum wages can be set out by the collective bargaining agreement (“CBA”) applicable to a business.

It is well known that the price of cryptocurrencies is massively volatile. If employees were paid their entire remuneration in a cryptocurrency, the actual value of their monthly compensation would depend on the exchange rate of the respective cryptocurrency (which could change rapidly).

While employees could benefit from an increase in exchange rates, they could also be impacted by (massive) exchange rate losses. Falling exchange rates could result in the salary suddenly falling below the mandatory collective minimum salary. Underpayment (including due to exchange rate fluctuations) could subsequently lead to considerable financial exposure for the employer. The employer would not only run the risk of employees claiming the difference, but also of authorities imposing fines for wage dumping.

To summarise, paying an employee’s entire remuneration in a cryptocurrency is currently not possible from an employment law perspective. Could our artist instead consider incentivising the studio assistants by, for example, paying them a bonus from the proceeds of the sales in cryptocurrency?

Crypto bonuses?

Bonuses are considered supplementary payments under Austrian law. A bonus payment can be made as a payment in kind, provided a collective minimum wage is paid in cash. In other words, from an employment law perspective, it is generally permissible for an employee bonus to be paid in the form of a cryptocurrency, if the statutory or collectively agreed minimum remuneration is paid in fiat money.

By Daniel Komarek, Associate and Teresa Waidmann, Counsel, Schoenherr

In short, an NFT (non-fungible token) is a set of data stored on a blockchain (a digital ledger), that certifies a digital asset as unique and thus non-fungible. Assets can be tangible (real estate) or intangible (IP rights).

The General Data Protection Regulation (GDPR) aims to protect fundamental privacy rights. It strives to achieve this goal by giving individuals more rights and more control over their personal data. Additionally, it puts more obligations on the data controllers’ shoulders and demands that controllers can always demonstrate compliance.

The GDPR is technologically neutral, which means GDPR compliance must be ensured whenever personal data of natural persons are processed in a structured manner. Consequently, the material scope of the GDPR is also applicable to the blockchain whenever personal data of a natural person are processed.

The fields of tension

Over the last couple of years, certain tensions between blockchain technologies and the GDPR have been discussed:

• To begin with, the GDPR “assumes” that there is at least one data controller (an entity that sets the purpose and the means of the data processing) which can be addressed by a data subject (an individual). In contrast to this “one-on-one” fiction of the GDPR, the blockchain works with multiple players and decentralisation. This makes the allocation of responsibilities on the blockchain under the GDPR more burdensome.
• Furthermore, the GDPR grants certain rights (e.g. the right to data rectification, the right to data erasure) to the data subjects, which again contradict the “blockchain values”, since the blockchain is a shared, immutable ledger for recording transactions, tracking assets and building trust.
• A further obligation of a data controller is to ensure “privacy by design”: simply put, this obligation demands that the GDPR principles are taken into consideration in the developing phase of a product rather than later on. Thus, Art 25(1) GDPR requires controllers to implement appropriate safeguards “both at the time of the determination of the means for processing and at the time of the processing itself”. This means that the blockchain itself should respect GDPR principles, such as data minimisation and purpose limitation, but also storage limitations.
• The “classic” debate is about the nature of the data which are typically stored on a blockchain. The question is whether personal data that has been encrypted or hashed (like public keys) still qualify as personal data. While it is often argued that they do not, such data likely does qualify as “personal data” within the meaning of the GDPR, because “personal data” is defined as “any information relating to an identified or identifiable natural person”. Since there are frequently means to (at least) identify the natural person based on the hashed values, the GDPR is applicable. On most blockchains, however, participants are only pseudonymised, and not “completely” anonymised, which means that the GDPR will likely apply.

Blockchain & GDPR-compliance?

Having outlined some of the areas of tension between the GDPR and blockchain technology, compliance might be achieved through a combination of

1. technical measures,
2. transparency, and
3. contractual provisions.

One option to achieve a higher level of GDPR compliance with blockchain technologies appears to be offered by the “Zero-Knowledge Proof” method (ZKP), an encryption scheme where one party can prove the truth of specific information to another party without disclosing any additional information. In contrast to the Proof-of-Work method (typically used to date), the ZKP method captures transaction data in such an encrypted form that it is (or at least currently seems to be) impossible to identify any actors involved. Applying ZKP would give transactions on the blockchain an assurance of privacy, but still be able to prove that the private data is present and correct. The downside of ZKP is that it requires a large amount of computing power, meaning it is not quite resource-saving.

Be careful when creating an NFT

As the privacy by design obligation shows, technical measures must be considered from the very beginning, but also have to be frequently reassessed. In addition, information obligations must be adhered to both from a contract law and a data protection perspective. As our “NFT self-experiment” showed, it is possible to influence the design of the NFT at the beginning. Therefore, NFTs should be created carefully, as there are many legal questions still to be clarified around this new invention.

By Peter Ocko, Associate, and Veronika Wolfbauer, Counsel, Schoenherr

Schoenherr, working with Latham & Watkins and Orrick Herrington & Sutcliffe, and has advised French diagnostic center group Cerba HealthCare on the acquisition of the Lifebrain Group from Investindustrial. Chiomenti and Wolf Theiss advised Investindustrial on the deal.

According to Schoenherr, Lifebrain owns and operates diagnostic laboratory centers throughout Italy and in Austria. Closing is subject to regulatory clearances and is expected by the end of 2021.    

Cerba HealthCare, majority-owned by EQT Partners, is headquartered in France and operates a network of clinical analysis and diagnostic centers in Europe. It also operates globally with its business unit for clinical studies to validate new active components and vaccines.

Schoenherr’s team included Partners Christian Herbst, Maximilian Lang, Volker Weiss, and Andreas Natterer, Counsels Teresa Waidmann, Veronika Wolfbauer, and Johannes Stalzer, Attorneys Alfred Amann, Evelin Hlina, and Iliyana Sirakova, and Associates Nina Zafoschnig, Michael Kern, Daniel Neuwirth-Riedl, and Daniel Komarek.

Wolf Theiss’ team included Partners Roland Marko, Ralf Peschek, Kurt Retter, Dieter Spranz, Manfred Essletzbichler, Clara Gordon, and Georg Kresbach, Counsels Wolfgang Lauchner and Jochen Anweiler, Senior Associate Harald Strahberger, Consultant Carolin Ziegler, and Associates Peter Pichlmayr, Dorothea Rauchegger, Manuela Regner, Theresia Welser, Phillip Wrabetz, Dominik Engel, Dominik Koenig, and Paul Berger.

Brandl Talos, working with Bar & Karrer, has advised AC Immune on the acquisition of Vienna-based Affiris AG’s portfolio of therapeutics targeting alpha-synuclein, a clinically-validated active vaccine candidate for the treatment of Parkinson’s disease. Davis Polk Wardwell acted as AC Immune’s U.S. legal counsel.

The all-stock asset acquisition is valued at USD 58.7 million and is still subject to regulatory approval.

According to Brandl & Talos, “AC Immune is acquiring all of Affiris’ assets and underlying intellectual property related to active vaccine candidates targeting alpha-synuclein and USD 5 million in cash for 7.1 million shares based on a price of USD 8.26 per common share of AC Immune. This share price represents a 10.7% premium compared to the closing price of AC Immune shares as of July 23, 2021.” According to the firm, “concurrent with the asset acquisition, AC Immune’s cash position, as well as its investor base, is also being strengthened by a total of USD 30 million in gross proceeds stemming from the asset acquisition and a parallel private placement transaction with a select group of investors that are adding Athos Service GmbH, First Capital Partner GmbH and MIG Fonds, the lead investors in Covid-19 vaccine innovator BioNTech SE, as new AC Immune shareholders.”

Bar & Karrer’s team included Partner Rolf Watter and Associate Vera Naegeli.

Brandl & Talos’ team included Partner Roman Rericha, Attorneys Stephan Strass, Alexander Stucklberger, and Raphael Toman, and Associates Christina Bernhart and Elena Ciresa.

Brandl & Talos did not reply to our inquiry on the deal.

Editorial Note: After this article was published, Eisenberger + Herzog announced it acted as the lead counsel to Affiris. It’s team consisted of Partners Marco Steiner and Judith Feldner, Attorney Johannes Feilmair, and Associates Fabian Larcher and Agnoeszka Blonska. MLL-Legal’s Partner Andrea Sieber and Attorney Philipp Falk acted as local Swiss counsel and Lloyd Harmetz, Partner at Ashurst, acted as US counsel.

Brandl Talos, working with Bar & Karrer, has advised AC Immune on the acquisition of Vienna-based Affiris AG’s portfolio of therapeutics targeting alpha-synuclein, a clinically-validated active vaccine candidate for the treatment of Parkinson’s disease. Davis Polk Wardwell acted as AC Immune’s U.S. legal counsel.

The all-stock asset acquisition is valued at USD 58.7 million and is still subject to regulatory approval.

According to Brandl & Talos, “AC Immune is acquiring all of Affiris’ assets and underlying intellectual property related to active vaccine candidates targeting alpha-synuclein and USD 5 million in cash for 7.1 million shares based on a price of USD 8.26 per common share of AC Immune. This share price represents a 10.7% premium compared to the closing price of AC Immune shares as of July 23, 2021.” According to the firm, “concurrent with the asset acquisition, AC Immune’s cash position, as well as its investor base, is also being strengthened by a total of USD 30 million in gross proceeds stemming from the asset acquisition and a parallel private placement transaction with a select group of investors that are adding Athos Service GmbH, First Capital Partner GmbH and MIG Fonds, the lead investors in Covid-19 vaccine innovator BioNTech SE, as new AC Immune shareholders.”

Bar & Karrer’s team included Partner Rolf Watter and Associate Vera Naegeli.

Brandl & Talos’ team included Partner Roman Rericha, Attorneys Stephan Strass, Alexander Stucklberger, and Raphael Toman, and Associates Christina Bernhart and Elena Ciresa.

Brandl & Talos did not reply to our inquiry on the deal.