Law and regulation of Covid-19 loan moratoriums in Austria

1. Description of the legislation

1.1 Is there a moratorium on loans legislation implemented in your jurisdiction?


1.2 If no: Are there any ongoing discussions regarding a potential introduction of such measures?

Not applicable.

1.3 What is the name of the relevant legislation (the “Relevant Act”)?

Fourth COVID-19 Act (4. COVID-19-Gesetz), passed on 3 April 2020.

1.4 What is the duration of the measures (period of moratorium)?

31 January 2021.

1.5 Does the legislation provide for an extension of the period of moratorium?


1.6 Is the moratorium mandatory, or can each borrower opt out should they wish to simply continue payments, or opt in if they want to be protected by the moratorium?

Not mandatory, the borrower has the right to continue to make contractual payments on the agreed dates. However, participation is compulsory for institutions.

2. Parties and agreements affected by the Relevant Act

2.1 Is the moratorium available for both corporate and consumer loans?

Yes: it applies to loan agreements with microenterprises (defined as an enterprise which employs fewer than 10 persons and whose annual turnover and/or annual balance sheet total does not exceed EUR 2 million) and to consumer loan agreements.

The standstill is triggered if, due to circumstances arising from the COVID 19 pandemic, the microenterprise can no longer service principal and/or interest payments, or payment thereof would endanger the economic basis of the microenterprise’s business; or  the consumer(borrower) has shortfall of income, rendering payment of principal and/or interest not reasonable.

2.2 Who are the affected Lenders?

Not specified by the Relevant Act; all lenders lending to consumers and micro-enterprises in Austria.

2.3 Does it make a difference whether loans are granted by a foreign entity and governed by foreign law?

Not specified by the Relevant Act; in our opinion no.

The Relevant Act does not provide provisions on international private law, so the general rules of international private law apply. Consumer protection regulations may not be contravened by the agreement on foreign law. If the chosen law is more favourable to the consumer, the consumer may also choose to exercise the rights afforded to him or her under the chosen law.

3. Impact on the loan agreements

3.1 Is there a cut-off date with respect to loan agreements to which the Relevant Act will apply (e.g. not applicable to loan agreements entered into after the cut-off date)?

Moratorium applies to credit agreements concluded before 15 March 2020.

3.2 Does the moratorium apply to principal only, or also to interest and/or fees?

Principal and interest payments.

3.3 Will the maturity of the loan automatically be extended by the moratorium period?

Unless the parties to the loan agreement agree otherwise, the maturity will be extended by 10 months.

3.4 Are repayments and interest which have become due and payable under the contract before the Relevant Act has come into force covered by the moratorium?

Repayment instalments and interest payments becoming due and payable between 1 April 2020 and 31 January 2021 are covered.

3.5 Will lenders be able to terminate a loan due to an event of default other than non-payment (e.g. breach of financial covenants)?

The statutory standstill does not result in an event of default, termination event or acceleration event. Lenders are not entitled to exercise any event of default, termination event or acceleration event on the basis of the statutory standstill or a substantial deterioration of the financial situation of the borrower.

Portrait of Günther Hanslik
Günther Hanslik
Managing Partner
Dominika Jankowska