Category: Austria

Oberhammer Rechtsanwalte, BPV Huegel, and DLA Piper, acting with Ewald Oberhammer, Christoph Nauer, and Christian Temmel, respectively, as independent proxies at the general meeting of Schoeller-Bleckmann Oilfeld Equipment Aktiengesellschaft — the first virtual general meeting of a listed company in the German-speaking countries, together with Wilhelm Rasinger from the Interessensverband der Anleger (IVA).

According to the COVID-19 Company Law Regulation, listed companies may hold their shareholders’  meetings virtually if four independent proxies are appointed (and SBOE is listed on the Vienna Stock Exchange in the prime market segment). Thus, shareholders were able to submit requests via the proxies at the general meeting. The shareholders’ meeting was streamed live on the Internet, and shareholders were able to ask questions to the Management Board before and during the meeting. Shareholders were also entitled to change their instructions to the proxies during the shareholders.

According to a BPV Huegel press release, “Ewald Oberhammer (Oberhammer Rechtsanwälte), Christoph Nauer (bpv Huegel) and Christian Temmel (DLA Piper Weiss-Tessbach) are of one opinion that this way of holding shareholders’ meetings has proven as good practice and that in the future, also after the end of the current COVID-19 restrictions, virtual shareholders’ meetings could be held more often.”

Binder Groesswang has helped Austrian Post on the introduction of its new bank – Bank99 – to the market.

Binder Groesswang reports that the work “included, among other things, the representation before the European Central Bank and the [Austrian] supervisory authorities (FMA and OeNB).”

Binder Groesswang’s team included Partners Stephan Heckenthaler, Gottfried Gassner, and Michael Binder, Counsel Stefan Frank, and Lawyers Moritz Salzgeber, Brigita Rakar, Andreas Perkonig, and Markus Sacherer.

CMS Vienna Partner Nikolaus Weselik will take over as the head of the working group on construction contract law and construction procedural law of the Austrian Society of Construction Law and Construction Business Management.

According to CMS, “this group plays a key role in the evaluation and further development of the Austrian construction contract and construction procedural law in cooperation with various representatives of the industry and bodies, such as Austrian standards. The results of the working group can form the basis for further legal developments in this area of law.”

Weselik, who has more than 20 years of experience, heads CMS’s Vienna’s Construction and Real Estate Practice. “[The Austrian Society of Construction Law and Construction Business Management] is an important platform in the field of construction law and the construction industry,” he commented. “A great deal of specialist expertise and practical knowledge flows into it. It is the place where fundamental, emerging issues are often discussed and further developed. I am very pleased to now chair this working group and perhaps also to be able to take steps towards the further development of this area.”

The Austrian Society of Construction Law and Construction Business Management was founded in 1978. Its primary goal is to promote the exchange of opinions on issues of public and private construction law among professionally, economically, and politically relevant and interested parties.

Binder Groesswang has advised Lenzing AG and Palmers Textil AG on the establishment of a joint venture to produce protective masks in Austria.

The production and sale of protective masks for the domestic and European market will start in May 2020. Over the next few weeks, capacities will be expanded to more than 25 million masks per month and the business will also be expanded geographically.

Palmers will contribute to the production and distribution of textile products and Lenzing its know-how in procurement, raw materials, and knowledge in the field of engineering.

The Binder Groesswang team consisted of Partner Florian Khol and Attorney at Law Hemma Parsche.

On March 27, 2020, CEE Legal Matters reported that Dorda had advised Warburg-HIH Invest Real Estate on the sale of a multi-story office building in the Summering part of Vienna to a real estate fund managed by Luxembourg-based Blue Colibri Capital. We spoke with Jana Wetzel, Real Estate Manager at Warburg-HIH Invest, about the deal.

CEELM: What is Warburg-HIH Invest Real Estate?

Jana: Warburg-HIH Invest is one of the leading investment managers for real estate in Germany and Europe. We adopt a future-oriented approach to finding, developing, and managing properties in the interests of our clients. Decades of experience, proximity to the real estate markets, and a tight-knit network allow us to identify real estate opportunities and quickly implement them in the right phase of the market. Around 150 institutional clients have entrusted their investments to Warburg-HIH Invest. Our specialists for structuring, product development, real estate management, and market development all work to develop the right investment solutions for them. Warburg-HIH Invest is represented at ten locations throughout Europe. As part of the HIH Group, our in-house capacities cover the entire real estate investment value chain.

CEELM: What about the office building in this deal specifically — what do you think made it particularly attractive to the buyers?

Jana: The main tenant of the property with a strong credit rating is the Federal Ministry of Finance of the Republic of Austria with an above-average remaining term. This crisis-proof and financially strong tenant is not often found on the market. Thanks to our active asset management, we were able to satisfy the tenants and sell the property in good condition with high development opportunities.

CEELM: Our story on the sale reported that it “took place via a limited bidding process and was done via a share deal.” Can you elaborate a bit on that?

Jana: We were approached about the property by a few longstanding partners. This then developed into a very small, cooperative, and transparent bidding process. We quickly realized that the bids were very fair and competitive. This enabled us to achieve the best possible result and to act efficiently. We took advantage of the great market opportunity in Vienna and profited from it.

CEELM: What was Dorda’s mandate on this deal, exactly? What were the specific areas they assisted you with and what parts did you choose to retain in-house?

Jana: Dorda was mandated to advise us on this transaction on the vendor side. The content of the mandate included the legal negotiation of the purchase agreement with the buyer, including the drafting of the purchase agreement. As this was a value-add property, there were extensive liability and warranty issues. Internally, the transaction was finally evaluated and approved by our legal department.

CEELM: What were the considerations that led you to choose Dorda specifically to assist you in this matter?

Jana: Dorda, as well as the real estate team around Stefan Artner, are personally highly valued on the Viennese real estate market and have a high level of expertise, not only legally but also professionally in the real estate sector. We have therefore known and appreciated Artner for many years. He knows our processes and needs and therefore advises our company perfectly every time. We are not only concerned here with excellent legal support, but also with a partnership at eye level, which we are happy to repeat.

 

Baker McKenzie has advised McDonald’s on the implementation of short-time work for all of its restaurants in Austria due to the Coronavirus pandemic.

According to Baker McKenzie, McDonald’s was one of the first to implement this model in Austria.

“As a result of the quickly reached agreement on the new short-time work, we and our franchisees were able to secure the continued employment of thousands of employees all over Austria,” commented Karin Probst, Head of Legal of McDonald’s Austria.

Baker McKenzie’s team was led by Partner Philipp Maier.

It’s hard to believe, but some cybercriminals are trying to take advantage of the coronavirus crisis. They seek to exploit IT weaknesses and use our fears and insecurities to obtain passwords, infiltrate company networks or launch cyberattacks. We have therefore put together a short overview of measures to decrease cybercrime risks in the current extraordinary situation.

Forms of cybercrime

The following forms of cybercrime are very common right now:

Phishing

Victims receive requests from a supposedly trustworthy entity to use a link leading to a deceptively real-looking website of this entity and to log-in. In doing so the user unwittingly discloses secret credentials.

CEO fraud

Employees receive very professional fake e-mails which appear to be from the CEO or another high-ranking person in the company with the urgent request to make an emergency payment due to the exceptional situation and to temporarily disregard compliance requirements. In some cases, employees are also threatened with dismissal or other measures if they refuse to comply. As a result, large amounts of money are often transferred to accounts abroad that cannot be recovered.

Malware or harmful links

The recipient is asked to open an attachment in an e-mail or to click on a link, which then installs malware on the device. This allows the perpetrator to obtain passwords and confidential data. In light of the COVID-19 pandemic, even the WHO had to warn about cybercriminals masquerading as the WHO to steal money and sensitive information (Link).

Ransomware

The system or data in it will be encrypted and the user threatened with deletion of all data unless they pay a ransom (e.g. in Bitcoins). 

Organisational measures

Although many companies have switched to home office now, it is doubtful they all have adequate technical and organisational measures in place to protect from cyberattacks. Many employees are not used to this form of work and use private devices, which increases security risks. All companies should therefore develop individual strategies and organisational measures to counter cybercrime risks. But even simple measures may help decrease cybercrime risks. These can include:

Raising awareness

Employees should be informed about and sensitised to the forms of cyberattacks. A common approach should be discussed with the IT department. Even simple Do’s & Don’ts for employees can help:

• Don’t open attachments or links from untrusted sources.
• Don’t comply with unusual requests relating to the disclosure of credentials, in particular by following a link. A brief internet search often helps to find out if there are phishing e-mails from the relevant entity currently in circulation.
• Observe compliance instructions and always confirm unusual internal instructions personally, ideally by calling or speaking to the superior personally.
• If your device suddenly slows down or consumes significantly more power, this could indicate malware.
• Report suspected cyberattacks immediately to the management and IT department and follow their instructions. Do not try to combat cyberattacks “on your own” but align your approach with the management and IT (e.g. paying ransom to release a blocked computer).
• Document all unusual activities as thoroughly as possible (screenshots, memory logs).

Check and adapt IT infrastructure

The new security risks resulting from home office work should be discussed with IT and appropriate security measures should be taken.

Checklists

To take the right steps in an emergency in a coordinated and effective manner, it is advisable to draw up checklists with clear instructions and guidelines, such as what emergency measures are to be taken and in what order and by whom, and who is to be informed by whom (e.g. lawyer, IT, etc.).

Protection under criminal law

The Austrian Criminal Code (“ACC“) provides for various provisions against cybercrime, such as:

• Section 118a ACC punishes illegal access to computer systems such as computer hacking and cyberattacks with the intention to use the received data to damage the victim.
• Sections 119 and 119a ACC cover the interception of confidential data or messages by technical means under certain conditions. These provisions are highly relevant when spy-software is used.
• Section 126a ACC punishes data corruption, e.g. by modifying or deleting data. Section 126b ACC punishes the disruption of IT systems, e.g. by Denial-of-Service-attacks or computer viruses.
• Section 126c ACC punishes the abuse of computer programs including the possession or the creation of trojans or malware under certain conditions.
• Section 146 et seq ACC punish fraud, which is highly relevant in the case of CEO fraud.

Affected companies are well-advised to assess possible actions under criminal law, especially as criminal proceedings provide the following advantages:

1. Public prosecutors and courts may apply investigative measures which are not available to the company itself, such as requesting IP addresses from communication service providers.
2. The public prosecutor is in charge of investigations and must clarify the facts and gather evidence (which can generally also be used for further civil law actions).
3. The company can participate in criminal proceedings as a “private party” to request compensation for the damages caused by the perpetrator without any court fees (as would be the case in civil law proceedings).

Criminal proceedings are therefore a good way to limit damages and to clarify the situation.

How to initiate criminal proceedings

To initiate criminal proceedings, victims would in practice file a statement of facts (Sachverhaltsdarstellung) with the public prosecutors’ office to encourage it to open an investigation. It is crucial that such a statement includes strong evidence, as the initiation of criminal proceedings requires sufficient initial suspicion (Anfangsverdacht). Therefore, companies affected by cyberattacks should in any case document the attack as well as possible and involve legal and IT experts from the start.

Information duties and others

Cyberattacks may also affect the company’s contractual partners or third parties. Therefore, it should be assessed if the relevant contracts provide for specific (information) obligations in such cases. Further, also general civil law provides information and protection obligations in certain cases and a general duty to minimise damages. If private data is affected by the attack, obligations under applicable data protection laws also need to be assessed.

Under cyberattack! What to do?

In case of a cyberattack, the affected company should immediately consider and clarify the following:

1. What information is currently available?
2. Who is the potential perpetrator?
3. What evidence and documentation is available and was it secured? Who are potential witnesses?
4. Who needs to be informed? Are external experts needed to clarify the situation?
5. Which actions under criminal law are available?
6. Do we have further legal obligations, e.g. information duties vis-à-vis contractual partners?

By Michael Lindtner, Attorney at Law, Schoenherr

Cerha Hempel and Schoenherr advised OMV on the acquisition of a 39% stake in Borealis AG from Mubadala for USD 4.68 billion. Allen & Overy, Eisenberger & Herzog, and Binder Groesswang advised Mubadala on the transaction, which remains subject to regulatory approval and is expected to be completed by the end of 2020.

As a result of the acquisition OMV, which currently holds 36% of Borealis, will increase its stake to 75%.

Cerha Hempel’s team included Partners Clemens Hasenauer, Johannes Prinz, Harald Stingl, and Lorenz Pracht, Attorney Alexander Reich-Rohrwig, and Associates Ferdinand Guggenmos, Michael Ebner, and Julia Digruber.

Schoenherr’s team included Partner Franz Urlesberger and Associates Johannes Frank and Bianca Duca.

Eisenberger & Herzog’s team included Partners Peter Winkler, Nidal Karaman, and Jana Eichmeyer and Associates Philipp Schrader, Martin Zankl, and Claudia Kendlbacher.

Binder Groesswang’s team included Partners Christian Wimpissinger, Andreas Hable, Thomas Schirmer, and Philipp Kapl and Associates Clemens Willvonseder, Alexandra Hochegger, and Moritz Salzgeber.

“From the perspective of the Austrian people the government is doing a great job,“ says Raimund Cancola, Partner at Taylor Wessing in Vienna. “We’re really lucky that the current coalition is working in unison – they’re quite complementary. Almost nobody has any substantial negative remarks over their handling of the crisis.”

Cancola reports that the government took steps to get ahead of the crisis early and is currently “striking a fine balance between protecting public health and the economy.“ He describes the government’s approach as “very nuanced with the health of all the citizens being a clear priority.“ He also reports that Austria is subsidizing parts of the economy in an effort to protect businesses and jobs. “This goes against the budget deficit, but it seems that keeping a balanced budget is a pipe dream, as it is in many other countries right now.“

Furthermore, Austria has recently announced that some of the restrictions that are currently in place are likely to be reduced after Easter. “It is likely that some smaller shops will be allowed to reopen and businesses that employ proper protective measures, like face-masks and gloves, will be back in play.“ Currently, he says, Austria has taken steps similar to Germany when it comes to protecting employees. “The country has established a short-time work scheme which subsidizes enterprises,“ he says. “This allows employers to keep workers on, thus preventing layoffs. This program must be applied for and many already have.”

Of course, the announced intention to relax some measures is contingent on the number of infections going down. “The government is practicing cautious optimism, and if current trends persist, relaxations are likely,“ Cancola states. All of the other governmental efforts are aimed at “keeping businesses and the economy liquid – we’ve yet to see concrete post-crisis plans that will deal with revitalizing the economy.“

“These are tough times for law firms too, particularly larger ones,“ Cancola says. “Corporate transactions are slowing down, apart from those that were in their final stages of completion and the economic reality of which was not altered by the COVID -19 crisis.“

“However,“ Cancola adds, “the number of distressed M&A deals as well as commercial and dispute work are expected to increase in the back half of the year.“ According to him, in those areas at least, “a huge volume of work is to be expected.“ And Cancola states that labor and employment practices are “hot right now“ as is IP/IT, “especially concerning data protection matters.”

“Overall,” he says, “it’s still too early to have a clear picture, and developments over the coming 2-3 months at least will hopefully bring more clarity.“

Dorda has successfully represented Willhaben in a dispute against AutoScout24 AS involving the Austrian Unfair Competition Act.

According to Dorda, “Willhaben is an Austrian car and motorcycle marketplace, owned by the Styria Media Group and the Norwegian media group Adevinta ASA, each holding 50%. Autoscout24 is part of the internationally active Scout24 Group.”

Since 2018 AutoScout24 had been claiming in its advertisements that it is “Austria’s largest car exchange” on various channels. However, according to Dorda, “this asserted leading position did not exist for all relevant areas, [and so] Willhaben was … able to obtain an injunction against the incorrect advertising.”

Dorda’s team consisted of Attorney Andreas Seling.