AUSTRIA Trends and Developments Contributed by: Markus Fellner, Paul Luiki and Peter Blaschke, Fellner Wratzfeld & Partner
Additionally, the law introduces simplifications in trade law, such as the electronic validation of company register entries during business reg - istration. It also includes adjustments to labour protection laws, such as extended deadlines for certain reporting requirements following a busi - ness transfer. Draft Corporate Leadership Positions Act (Gesellschaftsrechtliches Leitungspositionengesetz- “CLPA” ) A draft pending review for the issuance of a Cor - porate Leadership Positions Act, as proposed by the Austrian Federal Ministry of Justice, aims to implement EU Directive (EU) 2022/2381, which mandates gender-balanced representation in the leadership bodies of listed companies. Key Provisions of the CLPA draft include the fol - lowing. • In listed companies, the supervisory board must consist of at least 40% women and at least 40% men. • If the management board of a listed company consists of more than two persons, it must include at least one woman. (This require - ment goes beyond the EU directive, aiming to improve the historically low representation of women in executive positions.) • If the gender quota is not met, the appoint - ment of supervisory board members is invalid ( “empty seat rule” ). Executive board members appointed in violation of the quota will not be registered in the company register. Rising numbers of insolvencies According to a study by the Austrian creditor’s protection association (KSV 1870), in 2024, a total of 6,587 companies in Austria had to file for insolvency, averaging 18 corporate bankrupt - cies per day. The main drivers of insolvency are
the trade sector, the construction industry and the hospitality sector. In addition, there were 86 major insolvencies with liabilities exceeding EUR10 million. By comparison, there were only 44 such cases in 2023. Not only but also due to the high number of major insolvencies, total liabilities have increased by 35% compared to 2023, reaching a total of EUR 18.9 billion – starting from an already very high level. Furthermore, 50,300 creditors (+10% compared to 2023) and 29,600 employees (+25% com - pared to 2023) are affected. For most affected companies, energy, raw mate - rial, and personnel costs are major problem areas, which they have often been unable to pass on to buyers or only to a limited extent. It is also striking that many of the insolvency cases involve a large number of creditors (100 or more). As a result, these insolvencies also impact other businesses and their partners, increasing the risk of further insolvencies. Additionally, a short - age of skilled workers and the declining order volume are causing difficulties. Furthermore, overall export demand in Austria and Europe is progressing slowly. The largest insolvency of the year 2024 was recorded by Fisker GmbH, with liabilities amounting to EUR3.79 billion. It is followed by entrepreneur René Benko (EUR2.43 billion) and the Benko Family Private Foundation (EUR2.28 billion). Recently filing for insolvency, KTM AG ranks fourth with liabilities of EUR1.82 billion. Meanwhile, Leiner & kika Möbelhandels GmbH, which went bankrupt for the second time in two years, falls outside the top ten largest insolven - cies of the year with EUR139 million in liabilities.
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