Litigation 2025

AUSTRIA Trends and Developments Contributed by: Bettina Knoetzl and Katrin Hanschitz, KNOETZL HAUGENEDER NETAL GmbH

that survived the pandemic due primarily to gov- ernment aid and are now succumbing in large numbers. The insolvency courtrooms are cur- rently being likened to doctors’ waiting rooms, with “patients” (debtors) being called up every 15 minutes. While experts expect the situation to stabilise in 2025, the backlog of insolvency cases can be expected to keep the courts busy The new – belatedly implemented – EU collec- tive redress rules in Austria are set to change the class action landscape in Austria. While some of the more ambitious changes – eg, broader discovery rules – were not implemented, the new class action system nonetheless ben- efits from the two-phase system that is designed to prevent abusive class actions and to steer the proceedings to increase effectivity and speed. Class action claimants will also benefit from sub- stantially reduced court fees; the high Austrian court fees may otherwise have prevented major class actions being filed in Austria. for far longer. Class actions Practitioners, including litigation funders, are cautious, given the lack of clarity of some of the rules. Once the first-class action claims have been filed – presumably in 2024 and 2025, in particular once the new qualified entities in Aus- tria and other EU member states have obtained the required authorisations – the courts will likely clarify how these rules will be implemented in practice. A framework for a functioning class- action litigation system can be expected to be established within the next five to ten years. Austrian-style discovery US and UK litigators involved in Austrian trials are often surprised that, while the burden of proof largely lies with plaintiffs, neither pre-trial

disclosure nor document production are avail- able in a form that would be recognisable to a common-law practitioner. Document production, for example, is limited by law to specifically named documents that are directly relevant to the case at hand, with broad rights of refusal (similar to the grounds to refuse to give evidence, such as avoiding the risk of prosecution and preserving confidentiality obligations, personality and family rights, busi- ness secrets, etc). If a party refuses to produce a document without a valid reason, the court may draw a negative inference, but there are no further penalties for non-compliance. More generally, the courts regularly refuse document- production requests and witness interrogation on the grounds that “fishing expeditions” are not permitted. This frustrating lack of access by the plaintiff to relevant information is alleviated in some are - as by a reversal of the burden of proof to the defendant (eg, D&O liability) or by allowing prima facie, evidence (in particular in medical liability cases). However, in most cases plaintiffs are well-advised to ensure they possess the nec- essary information and evidence before filing a claim. Currently, a remarkable new line of case law appears to be developing that could profound- ly enhance the scope of discovery in Austrian proceedings: Section 184 of the Austrian Civil Procedural Code (CPC) allows parties to direct questions to the opposing party or their counsel to clarify the facts of the case. In the past, this provision was interpreted narrowly and rarely invoked. The Austrian Supreme Court has now indicated that it will apply Section 184 more broadly to enable “the most comprehensive and truthful findings of fact”. In a recent case against

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