Austria has an area
of 32,374 square miles and is completely landlocked. It is bordered
by Switzerland, Germany, the Czech Republic, Slovakia, Hungary,
Italy, Slovenia and Liechtenstein. The capital is Vienna and other
cities are Graz, Linz, and Salzburg.
Austria has a population
of approximately 8 million people. Its inhabitants belong to the
major European groups, Germanic, Neo-Latin and Slav peoples.
Austria is a Federal
Republic of nine provinces. It has a president (Bundespraesident)
who is Head of State. He is elected directly by the people and
holds office for six years. The Federal Government has powers
of legislation. The Bund is entitled to legislate but the Laender
are responsible for the implementation of such legislation. There
are two chambers in the parliament, the Nationalrat and the Bundesrat,
the latter representing the provinces.The Federal Government is
headed by the Chancellor (Prime Minister), who is chosen by the
INFRASTRUCTURE AND ECONOMY
Austria became a full member of the EU in January 1995, entered
the ERM and is now within the EURO zone. Austria's domestic market
is relatively small and foreign trade is of major importance.
The single biggest partner for imports and exports is Germany.
Its geographical closeness to Eastern Europe has meant that substantial
inward investments have been made into Austria by multinationals
in order to reach these markets. As with most other industrialised
countries, the service industry and particularly financial services
have grown considerably over the last few years, with agriculture,
forestry, and also tourism declining. Other industries are iron
and steel, paper and engineering.
98 % of Austrians speak
German, with various local dialects.
The currency is the Euro, it was introduced in 2002.
There is no exchange control in Austria other than certain reporting
requirements for statistical purposes.
TYPE OF LAW
PROCEDURE TO INCORPORATE
As a legal entity,
a company comes into existence upon registration in the commercial
register. To form a company, an agreement of incorporation (for
a GmbH) must be drawn up in German and has to be filed with the
Commercial Court. For an AG, all founders need to sign the Articles
of Association before a Notary. Founders may grant Powers of Attorney
to our offices lawyers to represent them. All Austrian companies
are obliged to become members of the local Chamber of Commerce.
RESTRICTIONS ON TRADING
Yes, for certain industries
such as banking and insurance, as well as industries where the
state retains the monopoly, i.e. broadcasting, tobacco importation
and production, and gambling. Real estate acquisitions by foreigners
are subject to approval.
POWERS OF COMPANY
A company has the same
powers as a natural person.
LANGUAGE OF LEGISLATION
AND CORPORATE DOCUMENTS
PRINCIPAL CORPORATE LEGISLATION
The Commercial Code
and the Financial Reporting Act.
TYPE OF COMPANY
The two main types
of company are the Joint stock company (AG) and the limited liability
company (GmbH), which is the most widely used form of foreign
investment. Other types include the general partnership (offene
Handelsgesellschaft), the limited partnership (Kommanditgesellschaft)
and the silent partnership (stille Gesellschaft).
SHELF COMPANIES AVAILABLE
Yes, but not used very widely.
TIME TO INCORPORATE
Six weeks to two months,
branch registration can take longer.
Names that are too
similar or identical to already existing ones.
NAMES REQUIRING CONSENT OR A LICENSE
Banking and Insurance
businesses and names, businesses within the financial services
industry, and business names that include the term "Austria".
Yes, in Austria.
SUFFIXES TO DENOTE LIMITED LIABILITY
GmbH and AG
DISCLOSURE OF BENEFICIAL OWNERSHIP
MINIMUM SHARE CAPITAL
CLASSES OF SHARES PERMITTED
GmbH is based upon
AG permits ordinary
and bearer shares, voting or non voting, preference shares
BEARER SHARES PERMITTED
Only of AG
Corporate Tax rate
is 25 % and capital gains are treated as regular corporate income.
There is a minimum corporate tax of € 1,092 in the first years
after incorporation and € 1,750 in the following years irrespective
Real Estate Transfer tax: 3.5 %
DOUBLE TAXATION AGREEMENTS
Austria has double
tax treaties with more than 40 countries which include:
Australia, Belgium, Brazil, Bulgaria, Canada, China, Cyprus, Denmark,
Egypt, Finland, France, Germany, Greece, Hungary, Iceland, India,
Indonesia, Ireland, Israel, Italy, Japan, Luxembourg, Malta, New
Zealand, Poland, South Korea, Spain, Sweden, Switzerland, Thailand,
Turkey, UK, USA, Zambia.
Austrian law does not
allow for the creation of Trusts, but it does recognise foreign
Trusts. In order to foster investment, Austria has a regime for
Holding companies. Under the international participation exemption,
dividend income received from foreign subsidiaries or capital
gains realised from the sale of the same are exempt from Austrian
tax. In order to enjoy this tax treatment, certain criteria have
to be met, i.e. a percentage of shares held in the foreign corporation
for a certain period. The subsidiary must not be subject to tax
of less than 15 % in its home country. Not more than 50 % of the
Holding company must be owned by Austrian residents.