AUSTRIA Law and Practice Contributed by: Clemens Hasenauer and Albert Birkner, CERHA HEMPEL
certain qualified shareholdings in the financial sector), restrictions that may also have relevance to foreign investors mainly relate to real estate and sensitive industries. Further restrictions may stem from anti-money laundering (AML) legis - lation and know-your-customer (KYC) require - ments, as well as in relation to intended transac - tions with blacklisted/sanctioned foreign states and/or individuals. Last but not least, the EU has enacted the Foreign Subsidies Regulation (Regulation (EU) 2022/2560) which, inter alia, requires prior clear - ance of certain M&A transactions by the Euro - pean Commission. 2.4 Antitrust Regulations The relevant pieces of merger legislation are the Austrian Cartel Act 2005 and the EU Merger Control Regulation (139/2004). Depending on turnover thresholds, transactions of a certain size become subject to merger control clear - ance by the FCA or the European Commission. The Commission has exclusive jurisdiction if the transaction results in concentrations with an EU dimension. Where a transaction does not fall within the exclusive jurisdiction of the Commis - sion, it may require (pre-merger) notification to and clearance by the FCA. The Austrian merger control regime applies to several corporate transactions, such as: • the direct or indirect acquisition of shares if a shareholding of 25% or 50% is attained or exceeded; • any other combination (even below this threshold) enabling the buyer to exert a con - trolling influence on the target; or • joint ventures.
The FCA must be notified of these concentra - tions if certain turnover thresholds are met (pro - vided that no exemption applies). Furthermore, an additional threshold is linked to the turnover of the undertakings involved and the transaction value. Within one month of receiving the complete noti - fication, the FCA conducts an initial assessment (Phase I), and, most commonly, the transaction is cleared at the end of that period. The FCA initi - ates the main examination proceedings (Phase II) in more critical cases. Here, the Cartel Court has five months to finalise the investigations and consider whether the transaction creates or strengthens a dominant market position. It will finally either clear the transaction (which may be subject to conditions and/or obligations) or pro - hibit it (which is quite rare in practice). 2.5 Labour Law Regulations An acquirer has to consider the following rules in particular. Protection Against Dismissal The Austrian employment law framework grants special status to certain groups of employees, such as pregnant women or disabled persons, apprentices and members of the works council. These groups typically enjoy increased protec - tion concerning the termination of their con - tracts. In addition, older employees enjoy some protection against dismissal, particularly when it results in social hardship or otherwise substan - tially violates their justified interests. Co-Determination The Austrian Stock Corporation Act provides a two-tier board structure composed of the management and supervisory boards. In some instances, this structure also applies to limited liability companies. The management board is
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