AUSTRIA Trends and Developments Contributed by: Andreas Eustacchio, EUSTACCHIO
From Hardware Defects to Autonomous Systems For many years, Austrian product liability discus - sions were dominated by classic scenarios: defective household products, industrial machinery, construc - tion materials or medical devices. In these cases, the alleged defect usually lay in the physical properties of the product – a broken component, an inadequate safety guard, an unstable construction. Today, the market is experiencing a profound shift. A growing share of product liability risk now stems from software, connectivity and automated functions rather than from “pure” hardware. This development is particularly visible in the auto - motive and mobility sector. Modern vehicles integrate advanced driver assistance systems, complex sen - sor suites, high-performance computing platforms and permanent connectivity to back-end servers and other vehicles. The line between a “mechanical” prod - uct and a “digital” service is becoming increasingly blurred. For clients, this means that legal analysis can no longer stop at the question of whether a component is physically intact; it must also examine whether the system behaves safely in software-controlled and data-driven environments. From an Austrian perspective, these changes inter - act with a long-established legal framework. Product liability in Austria is primarily based on strict, fault- independent rules implementing EU law, comple - mented by fault-based general tort principles. While the basic concepts remain stable, their application to autonomous driving, networked products and AI- supported decision-making creates new pressures and questions. The trend is clear: Austrian courts, regulators and mar - ket participants are increasingly required to translate traditional notions of “product”, “defect” and “safety which a person is entitled to expect” into a world where software and data play a central role. Software as a Product: From Accessory to Core A central trend that clients should understand is the gradual but consistent recognition of software as a
product in its own right. Historically, software was often treated as something ancillary: a tool to run the machine, but not the “product” that courts and regula - tors focused on. With digitalisation and automation, this approach is no longer sustainable. In many modern products, and particularly in vehicles and mobility systems, software performs safety-crit - ical tasks. It interprets sensor data, decides when to apply brakes or steering inputs, manages battery sys - tems, controls airbag deployment and co-ordinates complex interaction between components. In those circumstances, it is increasingly difficult to argue that the physical hardware alone determines safety. With the implementation of the NEW EU Product-Lia - bility Directive, companies operating in Austria should assume that embedded software and standalone soft- ware can be evaluated under product liability stand - ards. This shift has several practical implications. • Safety and risk assessments must systematically integrate software architecture, coding practices, validation and verification, and the interaction between different software modules. • Documentation, including requirements definitions, hazard analyses, test results and change logs, becomes essential evidence to show that software- related risks have been addressed. • Product liability risk can arise not only from an initial coding error, but also from later configuration changes, data quality issues or interaction prob - lems between third-party components. Product safety by design: For clients, this means that product liability is no longer primarily the domain of mechanical engineering departments. Legal and com - pliance teams need to be closely aligned with soft - ware engineers, systems architects and cybersecurity specialists. This is particularly true where products are designed for safety-critical applications, such as automated driving or remote control of machinery. Strict Liability Reaching Software Developers Another important development concerns who is exposed to strict, fault-independent liability. Tradi -
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