Arbitration procedures and practice in Austria: overview

Austria has developed into one of the top venues for commercial arbitration. Traditionally it has been a popular place for arbitration for parties from Eastern and Central Europe, however today it attracts users from all over the world.

The Vienna International Arbitral Centre (VIAC) is the leading arbitration institution in Austria. As such, it administers many proceedings whose seat is in Austria. Its caseload, therefore, can be considered indicative of trends in Austrian arbitration.

As of 31 December 2019, the VIAC had 51 pending cases with an aggregated amount in dispute of over EUR449 million. In the same year, it registered a total of 45 new cases.

Commercial contracts accounted for 40% of all disputes and thus for the largest share, followed by construction, financial services and banking and business ownership each accounting for 11% of the total number of cases. Wholesale and retail trade and manufacturing represented 8% and 5% respectively. Energy, insurance and reinsurance, non-profit and public administration, professional and technical services and real estate each amounted to 3% of all cases.

The latest revision to the VIAC's arbitration rules (new Vienna Rules) applies to all proceedings commenced after 31 December 2017. The changes sought to implement current trends and recent developments in arbitration.

Previously, disputes had to be "of an international character" to be administered by the VIAC. An important amendment to the rules is that the VIAC can now also administer purely domestic cases. The revision underscores procedural efficiency, as the rules now expressly specify that the arbitrators, the parties and their representatives are obliged to conduct disputes efficiently and in a cost-effective manner. The principle is also supported by the VIAC Secretary General's discretion to increase or decrease the arbitrators' fees by up to 40% to account for efficient (or non-efficient) measures.

Under the new Vienna Rules, responding parties now have the opportunity to request security for costs. The new fee schedule provides for lower registration and administrative rates for proceedings with smaller amounts in dispute, while slightly increasing fees in high-value disputes.

In line with the current trend to increase transparency, the VIAC published a list revealing the names and countries of residence of arbitrators in all proceedings which were still pending as of 1 January 2017. It includes the status of a dispute and whether the arbitrator is still actively conducting the case or has been replaced (without, however, specifying the reasons for their replacement). It also indicates how the arbitrator has been appointed: by VIAC, the co-arbitrators, the claimant, or the respondent.

Today, commercial arbitration is widely used in Austria as a means of dispute resolution, particularly in the context of international or cross-border business transactions.

One of the most important advantages of international arbitration is the widespread enforceability of arbitral awards, as granted by the UN Convention on the Recognition and Enforcement of Foreign Arbitral Awards 1958 (New York Convention).

Research has shown that users generally prefer arbitration over state court litigation for confidentiality purposes. Additionally, arbitration is more flexible than state court proceedings. Tailor-made procedural timetables, as well as proceedings that can be conducted in a language of the parties' choosing at a seat of their convenience, are considered major advantages over classic state court litigation. In 2013, Austria introduced a one-instance setting-aside process directly before the Austrian Supreme Court. This measure further emphasises the Austrian legislature's priority to ensure efficient arbitral proceedings.

These advantages are very often the reason why parties prefer arbitration over litigation to resolve their cross-border disputes. Domestic arbitration, however, has not yet been used to its full potential. Even though litigation is frequently criticised for its long duration, in general, parties still bring their domestic disputes to state courts.

Sections 577-618 of the Austrian Code of Civil Procedure (ACCP) provide the statutory rules on arbitration in Austria.

These rules are largely aligned with the UNCITRAL Model Law on International Commercial Arbitration 1985 (UNCITRAL Model Law).

Although parties enjoy a great deal of autonomy in determining the conduct of the proceedings, Austrian law includes several mandatory provisions. The majority of these are intended to guarantee certain standards of due process and ensure fair treatment of the parties.

The ACCP does not provide an exhaustive list. Instead, whether a rule is mandatory or non-mandatory is typically indicated by its wording. Thus, the use of "shall" and "cannot" signals mandatory non-deviation, whereas other provisions expressly clarify that parties are free to override them ("unless otherwise agreed").

Accordingly, mandatory provisions relating to arbitrators specifically include the:

Similarly, mandatory provisions relating to the parties ensure a variety of rights, including:

Further mandatory provisions provide for writing requirements, set minimum criteria for a valid arbitration agreement, define objective arbitrability, or relate to the process of setting aside an award. Finally, specific mandatory provisions pertain to consumer and labour disputes.

The ACCP expressly governs objective arbitrability, providing that:

A limited number of disputes are declared non-arbitrable by law, including family law claims as well as certain housing, labour and social security matters.

In general, limitation is treated no differently in arbitration than it is in state court proceedings. The initiation of arbitration proceedings suspends the limitation period applicable to the claim, just as the initiation of state court proceedings does. This also applies if the claim was raised with an institution lacking competence or an award is later set aside due to the tribunal's lack of jurisdiction, if the claim is then promptly filed with the correct court or arbitral tribunal.

In contrast to German law, which specifies that such a claim must be filed within six months following a decision denying jurisdiction, Austrian law does not define a period within which a claim is to be considered as "promptly filed" with the correct court or institution. The Austrian Supreme Court has previously held, however, that a claim filed with a state court one month after an arbitral tribunal denied jurisdiction was timely submitted.

Contrary to the approach taken by many common law jurisdictions, the statute of limitations in Austria is governed by substantive law. The general limitation period under Austrian civil law is 30 years. With respect to rights of legal entities, the Civil Code extends this period to 40 years.

Importantly, however, individual statutes may provide for shorter limitation periods of just several years. This applies to rights of particular practical relevance such as interest, annuities, maintenance payments, rights to delivery of goods, the right to terminate a contract for error, warranty claims as well as certain inheritance claims. The limitation period for these rights is three years. In general, a limitation period of three years also applies to claims for damages. It is triggered once the aggrieved party becomes aware of the damage and the identity of the liable party. Claims for damages may nevertheless become time-barred by the long limitation period of 30 years which runs irrespective of when the aggrieved party becomes aware of the damage and the identity of the liable party.

Parties doing business in Austria typically refer their disputes to the International Chamber of Commerce (ICC) in Paris or the VIAC in Vienna.

The VIAC and the ICC are also the most commonly used arbitration institutions for proceedings seated in Austria, regardless of the parties' origin or place of business.

The concept of kompetenz-kompetenz is expressly recognised by section 592 of the ACCP. Thus, where an objection against its jurisdiction is raised, the arbitral tribunal itself has the competence to decide the matter. Notably, a party must raise such an objection with its first pleading on the substance.

However, the tribunal's award on jurisdiction may still be subject to challenge before the Austrian Supreme Court. The ACCP provides a uniform system of review for jurisdictional decisions by providing that decisions on jurisdiction are challengeable on the grounds that either "a valid arbitration agreement does not exist" or "the arbitral tribunal denies its jurisdiction despite the existence of a valid arbitration agreement".

Where a set-aside proceeding against a partial award on jurisdiction is pending before the Austrian Supreme Court, the tribunal may still decide to continue and even render an award on the merits. A subsequent negative decision of the Austrian Supreme Court would make the award on the merits again susceptible to setting-aside proceedings.

For an arbitration agreement to be enforceable, certain requirements must be met.

The parties must be identified or at least identifiable in their agreement. In addition, the parties' will to submit disputes to arbitration must be clearly expressed. The agreement must also pertain to a specified legal relationship and be in writing. That means that it must either be contained in a written document signed by the parties or concluded by an exchange of letters, faxes, emails or other forms of communication that provide "proof of the existence of the agreement".

An arbitration agreement can be contained in a separate document but it can also take the form of a clause in the parties' main contract.

An arbitration clause incorporated into a contract only by reference will generally be enforceable if it is clear that the parties intended for it to become a part of the contract. This is particularly relevant for arbitration clauses contained in the general terms and conditions applying to an agreement.

By concluding an optional arbitration clause, the parties agree to refer their dispute either to litigation before state courts or to arbitration. This might be sensible in cases where the parties are, at the time of conclusion of the contract, aware of the possibility of disputes arising not only in relation to the entire contract but also to smaller amounts, which are better suited for state courts for cost-efficiency reasons. At the same time, such optional clauses often give rise to procedural confusion.

Bilateral optional clauses allow both parties to choose between the national courts and the arbitral tribunal, that is, to select the forum to which the specific dispute, once arisen, must be referred.

Unilateral arbitration clauses, on the other hand, grant this option only to one of the parties. Even though the Austrian Supreme Court has not yet ruled on the validity of such arrangements, unilateral optional clauses have been considered valid by legal scholars. Importantly, however, if such an asymmetric agreement is contained in the terms and conditions of the party entitled to select the forum, and if other circumstances exist that add to the imbalance between the parties, the agreement may be considered to violate public morals and would thus be unenforceable.

The ACCP does not expressly govern third-party joinder. It has been argued that, in principle, a third party can be joined where the proceedings will impact its legal sphere. Naturally, the party must submit itself to the jurisdiction of the tribunal and the terms of the arbitration agreement, and the original parties to the arbitration agreement must consent to the joining of a third party.

Where parties have submitted their dispute to the Vienna Rules, Articles 14 and 15 provide a comprehensive framework on third-party joinder. A joinder can be requested at any stage of the proceedings by either party or by the third party to be joined. The decision on whether the request should be granted and, if yes, to what extent, lies within the discretion of the arbitral tribunal, which must hear all existing parties to the arbitration and, unless the request was submitted by the third party itself, it must also hear the third party.

In principle, arbitration is fundamentally consensual in nature, meaning that the effects of an agreement to arbitrate only extend to the contracting parties. However, there are ways in which non-signatories can be bound by, and benefit from, arbitration agreements.

Arbitration agreements are in principle binding on legal successors. This applies both to singular and universal succession. The most common means of universal succession is by a company's merger, a spin-off or a transformation of a company's legal form. Further, in modern commerce, contractual obligations or specific rights are frequently transferred from one party to another, by way of assignment, assumption, or other transfer mechanisms. Where a claim is assigned, an arbitral agreement concluded between the assignor and the debtor is in general binding on the assignee, if there is no contractual or legal prohibition rendering the assignment ineffective. Likewise, an arbitration agreement is binding on the new debtor in cases of debt assumption. This applies all the more where an entire contract is transferred.

Further, in cases of subrogation by operation of law, the legal successor is entitled to invoke, and is bound by, an arbitration agreement. A third-party beneficiary claiming the benefits of a contract containing an arbitration clause is entitled to invoke and is bound by the agreement to arbitrate, even though it has not signed the contract.

Partners in business partnerships (Personengesellschaften) are personally liable for the partnership's debts. However, the Austrian Supreme Court has ruled that they are bound by arbitral agreements concluded by the partnership only where they have expressly consented to that effect. Shareholders in stock corporations (Aktiengesellschaften) are in principle not bound by arbitration agreements concluded by the corporation. This is a consequence of the stock corporation's legal autonomy and the principle of separation between the corporation and its shareholders. However, in specific circumstances, the corporate veil can be lifted with respect to the corporation's substantive obligations or liabilities, and the arbitration agreement may likewise be extended to the shareholders.

A non-signatory can be bound by an arbitration agreement and can therefore compel a signatory to that agreement to refer their dispute to arbitration under the circumstances described in Question 10.

Although the doctrine of separability is not found in Austrian statutory law, the Austrian Supreme Court applies it on a case-by-case basis and considers it an issue of contract interpretation. In doing so, it examines the intentions of the parties at the time the agreement was signed.

Generally, the agreement to arbitrate can be said to have a legal existence separate from the main contract and may thus survive if the latter is terminated or declared null and void.

As confirmed by the Austrian Supreme Court, and in line with generally accepted principles of international arbitration, the arbitration agreement is not affected by the invalidity of the main contract, even where the latter is invalid due to violation of law or public morals. The arbitral agreement likewise remains in force in cases of unilateral termination of the main contract or where the contract has expired.

However, the Austrian Supreme Court has rule that an arbitration clause will cease to exist when the parties agree to rescind the entire contract or mutually declare the entire contract void or ineffective, unless the parties, expressly or impliedly, agree otherwise.

Further, the separability doctrine arguably does not provide the basis for the tribunal's jurisdiction where the main contract is not simply invalid but does not exist at all. So far, the Austrian Supreme Court has not provided clear guidance as to whether the arbitration clause would survive such lack of party consent. With respect to the right to terminate a contract for error, the Supreme Court has applied the separability doctrine where the arbitration agreement has remained unaffected by the error.

If a valid arbitration agreement exists, the court must reject an action brought before it, unless the responding party makes submissions on the dispute or oral pleadings without raising a respective objection.

The ACCP does not prevent arbitration proceedings from being initiated or continued while such state court proceedings are pending. However, in practice, arbitral tribunals will usually suspend the proceedings until the court has come to a final decision.

An arbitral tribunal has the competence to rule on its own jurisdiction. Where a jurisdiction clause expressly refers the dispute to state court proceedings, or, more often, no valid arbitration agreement has been concluded, the tribunal must decline its jurisdiction.

A tribunal's decision on its own jurisdiction may be subject to challenge in accordance with section 611 of the ACCP.

The Court of Justice of the European Union (CJEU) considers anti-suit injunctions falling within the territorial scope of Regulation (EU) 1215/2012 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (Recast Brussels Regulation) to be incompatible with that regulation. Notably, in a more recent decision, the court clarified that this does not preclude arbitral tribunals from issuing anti-suit injunctions since the regulation does not apply to arbitral proceedings. Hence, the recognition and enforcement of anti-suit injunctions issued by arbitral tribunals is governed by the domestic laws of the EU member states and the applicable treaties. In Austria, access to courts represents a fundamental constitutional right. Hence, an interim measure prohibiting a party from accessing Austrian courts will likely be found to be in breach of procedural public policy and will be denied enforcement.

If called to issue anti-suit injunctions, Austrian courts will not, and indeed cannot, interfere with foreign state courts' competences and responsibilities.

Anti-arbitration injunctions, that is, interim measures issued by an Austrian court and prohibiting the commencement or continuation of arbitral proceedings, are not permissible either as Austrian arbitration law expressly provides that arbitral proceedings can be commenced even where the dispute is pending before an Austrian court.

Parties have substantial freedom and discretion in defining the terms of the agreement regarding arbitrator qualifications or characteristics. An arbitrator is not required to be a national of Austria or a qualified Austrian lawyer. However, arbitrators must be at least 18 years old and have legal capacity.

Additionally, Austrian judges are not permitted to accept positions as arbitrators during their service in office. However, as recently confirmed by the Austrian Supreme Court, accepting the mandate as arbitrator merely represents a breach of the judge's professional duties and does not amount to a flaw in the arbitral proceedings. In any event, there is no provision prohibiting foreign judges from acting as arbitrators.

One arbitrator is sufficient, but if the parties choose to have multiple arbitrators, there must be an uneven number. Parties typically agree to have their disputes settled by a sole arbitrator or by a tribunal consisting of three arbitrators.

The ACCP requires that arbitrators execute their responsibilities with full independence and impartiality. Arbitrators are under a statutory obligation to disclose all circumstances that are likely to give rise to doubts as to their impartiality and/or independence. In addition, if the arbitrator considers such doubts to be justifiable, he or she must reject the mandate or resign. Failing such resignation, a party can raise a challenge against that arbitrator.

Parties have full discretion and authority to decide on their own method for arbitrator appointments, provided that it does not run contrary to public policy or the principle of parity. Certain mechanisms exist to appoint arbitrators when the parties are unable or unwilling to do so. The Austrian Supreme Court has the authority to appoint an arbitrator at the request of one party if the opposing party has failed to select an arbitrator within four weeks from its receipt of a request to do so.

There are several circumstances under which the removal of an arbitrator is permissible. Such circumstances include a successful challenge, party agreement, the resignation of an arbitrator, or by court decision in the event an arbitrator is unable to fulfil his or her duties or fails to act.

If the parties did not provide for a specific challenge procedure in their agreement, the arbitral tribunal decides on the challenge. In this case, the party raising the challenge must submit a written statement defining the reasons on which the challenge is based. If a challenge is not successful, the party can refer the matter to the Austrian Supreme Court. Notably, arbitral proceedings can continue despite a pending court challenge.

Ad hoc arbitration proceedings governed by Austrian arbitration law start with service to the respondent of the claimant's request for the appointment of an arbitrator. Such a request must refer to the arbitration agreement invoked and contain a statement on the claim to allow the respondent to make a suitable appointment. The respondent's receipt of this request effectively suspends the applicable statute of limitations.

Arbitrators are bound by the mandatory statutory rules listed in Question 3, the parties' agreement (including reference to a specific set of rules for the conduct of the arbitration) and the non-mandatory statutory rules that the parties have not validly deviated from. Apart from these important limitations, arbitrators can conduct the proceedings at their discretion.

The ACCP comprehensively governs the arbitral proceedings from their commencement through to the rendering of awards and recourse against them.

Some of these rules are mandatory and an arbitral tribunal cannot deviate from them, even where the parties have expressly agreed to do so (see Question 3).

Other rules apply only if the parties have not agreed otherwise. Where an arbitral tribunal fails to comply with these rules, parties must immediately raise an objection or they will be precluded from doing so at a later stage in the proceedings.

While an arbitral tribunal is bound to comply with mandatory and, where applicable, non-mandatory rules, as well as with the parties' agreement, it has wide discretion to determine the conduct of the proceedings and make any orders it deems fit.

For example, if there is no specific party agreement, the tribunal is entitled to determine its own seat or the language of the proceedings. Other significant powers include the authority to rule on the admissibility of the taking of evidence, carrying out the taking of such evidence, and to freely evaluate the results and order interim measures (if necessary). Notably, however, arbitral tribunals lack coercive powers and require court assistance when necessary.

Although arbitral tribunals can summon witnesses and request the parties to disclose documents, coercive powers are reserved for Austrian courts. Therefore, tribunals cannot enforce such orders. They are, however, free to consider a party's refusal to follow their orders when evaluating the evidence in the case.

As expressly stated by the ACCP, tribunals additionally can seek assistance from Austrian courts to conduct required judicial acts. This is true regardless of whether or not the seat is in Austria. Provided that the requested type of assistance does not violate Austrian public policy and that the measure cannot be taken by the tribunal itself, the court will grant the request without examining its usefulness or suitability.

The taking of evidence before Austrian state courts is characterised by the conflicting principles of directness (direct perception of the evidence by the competent judge) and procedural cost-efficiency. Importantly, the scope of fact that the court is authorised to investigate is limited by the parties' submissions. Ex officio inquiries are therefore not permitted. Section 303 of the ACCP defines the process of a (limited) request for document production in state court litigation. The requesting party must narrowly describe the content of the specific document and explain which facts must be proven by it. Further, the requesting party[must demonstrate that it is at least probable that the document is within the opposing party's possession.

The ACCP affords parties with wide autonomy to shape the taking of evidence and vests tribunals with broad discretionary powers to conduct the process and to evaluate its results freely. Thus, a party agreement can provide for "document production" procedures that originate from foreign jurisdictions and allow for a much broader scope of disclosure than in Austrian civil procedure.

Procedures governing document production can also be ordered by the arbitral tribunal on its own motion, that is, even in the absence of a respective party agreement. Such powers should, however, be used restrictively and always after cautious examination of the circumstances of each particular case. In doing so, the tribunal should determine whether and to what extent such an order would be consistent with the legitimate expectations of the parties at the time of the conclusion of the arbitral agreement. Where parties come from different legal cultures, this [can] prove a difficult and delicate task. Comprehensive US-style "discovery" procedures [will] typically be inappropriate.

Parties are thus free to agree on the application of the IBA Rules on the Taking of Evidence (IBA Rules) or any other set of rules tailored to the circumstances of the particular dispute. Indeed, parties frequently conclude a disclosure agreement based on Article 3 of the IBA Rules, authorising the arbitral tribunal to request the production of specific documents from one of the parties upon a request by the other party. In the event a party fails to comply with the tribunal's orders to disclose documents, the tribunal can draw adverse inferences with respect to the content of those documents.

The ACCP does not specifically govern the issue of confidentiality of arbitral proceedings. Nevertheless, the legislative materials state that the character of arbitral proceedings is confidential. Further, parties are free to enter into agreements on the confidentiality of their dispute and define its scope.

An agreement to this effect can also be concluded implicitly. This must be assessed on a case-by-case basis, taking into consideration not only the arbitral agreement but also the underlying main contract.

Naturally, parties and arbitrators can also agree on such a clause. Where proceedings are governed by the Vienna Rules, arbitrators are under an express obligation to keep the information acquired in the course of the proceedings confidential.

Court intervention in arbitration is limited to the circumstances expressly specified by law. The scope of permissible intervention cannot be extended or restricted by party agreement.

The ACCP vests courts with the power to assist parties in the process of appointing arbitrators by making a substitute appointment, to decide on arbitrator challenges as well as the termination of an arbitrator's mandate and to appoint a substitute arbitrator. Further, courts can grant interim and protective measures. They can be requested to set aside an arbitral award, to declare its existence (or non-existence), or to recognise and enforce it.

The Austrian Supreme Court serves as the first and final instance to hear party requests for assistance in the constitution of arbitral tribunals by appointing arbitrators, to hear challenges against arbitrators or other requests to remove them, to set aside arbitral awards and to declare arbitral awards non-existent. However, disputes between consumers and entrepreneurs and disputes over labour law matters do not fall within this exclusive competence.

As discussed in Question 23, the scope of court intervention is limited to a few circumstances expressly defined by law. Austrian courts are generally considered to be arbitration friendly, and so the risk of intervention is low.

If an arbitration is pending, Austrian courts must in principle reject claims on the same subject matter without interrupting the proceedings. If the subject matter is pending before a state court, a claim can still be raised and decided on in an arbitration. Similarly, a challenge against an arbitrator brought before the Austrian Supreme Court does not interrupt the arbitral proceedings. Importantly, where the Austrian Supreme Court has been authorised to decide as first and last instance, it is impossible to further postpone the binding effect of its decision by raising an appeal.

The opening of insolvency proceedings results in an automatic stay of all pending disputes over the insolvent party's assets, including arbitral proceedings, and regardless of whether the debtor is a claimant or a respondent. All claims against the debtor must be filed with the insolvency court which will then notify the appointed insolvency administrator of their existence.

Should the insolvency administrator or another creditor refuse to recognise such a claim as justified, the creditor raising that claim must bring an action against them and have the claim's validity examined through a special type of litigation referred to as "verification proceedings".

In a recent decision, the Austrian Supreme Court ruled that the insolvency administrator who had rejected the claim is bound by arbitral proceedings already pending in relation to that claim. Therefore, the verification of the validity of that claim must be done within the ongoing arbitral proceedings and not before the insolvency court.

To further clarify the relationship between arbitration and insolvency proceedings, the Austrian Supreme Court also expressly stated, albeit in passing, that not only the insolvency administrator is bound by the arbitral agreement, but so are any insolvency creditors who have refused to recognise the validity of the claim and have thus necessitated its verification.

Arbitral tribunals are authorised to order interim or protective measures where a party has reasonable grounds for concern that the enforcement of its claim would otherwise be frustrated or significantly impeded. A party can also submit such a request where it considers that a risk of irreparable harm exists. Such orders can also be rendered by state courts. Parties can, therefore, choose between state courts and arbitral tribunals.

With respect to the tribunal's powers to order security for costs, the 2013 revision of the Vienna Rules introduced a provision that is now considered one of the salient features of the Vienna Rules. It gives the party having paid the full advance on costs, including the other party's share, an executory title against the other party. This provision authorises the arbitral tribunals to (on request) issue a partial arbitral award ordering the defaulting party to reimburse the other party. Importantly, the latter can seek this remedy and enforce it while the arbitral proceedings are still pending.

Notably, since arbitral tribunals lack coercive power, their decisions can only be enforced by state courts. While arbitral tribunals have the power to order whatever interim measures they consider appropriate, courts can only enforce measures recognised under Austrian law. This means that Austrian state courts may have to transform the measures ordered by the tribunal into measures recognised under Austrian law.

Before issuing an interim measure, an arbitral tribunal must first hear the opponent of the party at risk.

Whether security for costs can be ordered under the provisions governing interim measures is subject to debate. The ACCP does not specifically address this issue.

Whether or not a given type of remedy is available in arbitral proceedings in Austria depends on the law applicable to the merits of the dispute. Thus, apart from public policy, there are no restrictions on the types of remedies that an arbitral tribunal seated in Austria can order.

A party to an arbitration can file an application to have the award set aside. The Austrian Supreme Court is the court of first and last instance in deciding on the challenge of an award. This is the only recourse available against arbitral awards rendered in Austria.

However, parties can request the arbitral tribunal to correct calculation, spelling or printing errors in the award and, based on a party agreement to that effect, provide an explanation of certain parts of the award.

Foreign arbitral awards can be scrutinised by Austrian courts within recognition and enforcement proceedings.

Apart from this, a party can request a judicial declaration on the existence or non-existence of an arbitral award, for example, to clarify the status of a document as a decision in expert determination proceedings or as a "non-award".

An application to set aside an arbitral award can be filed with the Austrian Supreme Court within three months from the service of the award to the parties. In accordance with section I.18.1 of the court's Allocation of Duties, the case will be reviewed by a special division of the Austrian Supreme Court consisting of reputable judges with long-standing experience in arbitration, namely the 18th Panel (18. Senat) (see also, Question 1, Advantages/disadvantages)

The Austrian Supreme Court can only set aside the award for very few grounds as expressly and exhaustively listed by law (section 611, paragraph 2, ACCP). These are:

Notably, only the last two grounds can be taken up ex officio if a challenge against the award is brought based on any of the above grounds. All other reasons must be expressly invoked by the party seeking to have the award set aside.

Parties can neither agree to expand the list of grounds for setting aside an arbitral award nor waive any of these grounds in advance. Further, the non-arbitrability of the subject matter of the dispute and the violation of substantive public policy must be examined ex officio and thus can never be excluded. The other reasons for challenging the award can be waived once the award has been issued.

Generally, an application to set aside an award must be filed within three months from the respective party's receipt of the award. The parties cannot validly agree to expand this period.

Where the challenge is based on a ground for revision of a court judgment (section 530, ACCP), a limitation period of only four weeks applies, which commences upon discovery of the relevant circumstances by the party challenging the award.

Austrian law does not provide for fixed fees. Parties are therefore free to agree with their counsel on whatever fee structure they consider appropriate, for example, a lump sum or a fee based on an hourly rate. However, contingency fees based on a percentage of the successfully claimed amount are considered to conflict with public morals and cannot be validly agreed.

In the absence of an agreement between counsel and attorney, the Austrian lawyers' tariff applies.

Third-party funders are present and active in Austria. Austrian law, however, does not expressly address the validity of third-party funding agreements in relation to arbitration proceedings.

The ACCP gives parties to arbitration proceedings broad autonomy to agree on the allocation of costs. In the absence of such an arrangement, the allocation of costs is within the discretion of the arbitral tribunal. While the law expressly requires the tribunal to consider the outcome of the proceedings (giving effect to the "costs follow the event" principle) it also allows it to take into account the circumstances of the case.

Parties to arbitral proceedings in Austria can request the reimbursement of all reasonable and appropriate costs, such as the costs for legal representation, the advance on costs, experts' fees and expenses, or, arguably, internal costs such as the costs for their legal department's efforts on the case.

Since the arbitral tribunal is not under an obligation to strictly and exclusively follow the "costs follow the event" principle, the tribunal is free to take into account other circumstances, such as in particular either party's contribution to procedural efficiency.

The ACCP expressly provides that arbitral awards rendered by arbitral tribunals having their seat in Austria have the same legal effects as judgments handed down by Austrian courts. Accordingly, the Austrian Enforcement Act treats them as executory titles by their nature. The party seeking enforcement must therefore only request enforcement authorisation from the competent local court. This is either the district court where the award debtor has their seat or domicile, or the district court where the movable or immovable asset of interest is registered or located.

Austria acceded to the New York Convention in 1961. In 1988, it withdrew its initial reciprocity reservation and has never made use of its right to make the commercial disputes reservation. Therefore, the New York Convention fully applies in Austria.

In addition, Austria has also signed and ratified the European Convention on International Commercial Arbitration. Article IX of this treaty governs the recognition and enforcement of arbitral awards. Austria has also acceded to the 1965 Convention on the Settlement of Investment Disputes between States and Nationals of Other States (ICSID Convention) which applies to disputes between foreign investors and host states. Articles 53 to 55 govern the recognition and enforcement of awards rendered under the treaty.

Apart from these multilateral treaties, Austria has concluded and ratified bilateral agreements with, among others, Belgium, Croatia, Kosovo Liechtenstein, North Macedonia, Montenegro, Serbia, Slovenia and Switzerland.

To enforce a foreign arbitral award, an award creditor must file an application for a leave for enforcement with the competent district court. Once this leave for enforcement is granted, the foreign arbitral award is given equal enforceability effect as any Austrian executory title and can undergo the same enforcement proceedings that apply to domestic awards. This means that the party seeking enforcement can request an enforcement authorisation from the district court (see Question 33).

The party seeking enforcement can combine the latter with the request for leave for enforcement to obtain both decisions at once.

Under Austrian law, limitation periods are an issue of substantive (and not procedural) law. Therefore, the limitation period of the executory title is governed by the law applicable to the merits of the dispute.

Where the substantive law is Austrian law, the ACCP provides that executory titles can be enforced within 30 years from the date on which they have become final and binding.

First instance proceedings do not require a hearing. They are ex parte and, therefore, straightforward. An award can therefore be recognised and granted enforcement within a few days. Since the creditor can combine the requests for leave for enforcement and an enforcement authorisation (see Question 35), the difference in the length of proceedings between domestic and foreign awards is insignificant.

The last reform of the Austrian arbitration law (Schiedsrechtsänderungsgesetz 2013) came into force on 1 January 2014. While the introduction of a fee cap in set-aside proceedings and reforms over shareholder participation in corporate disputes have been considered, there are currently no formal proposals for further amendments.