Payment term legislation in Austria

Yes. The provisions of the EU Directive 2011/7/EU on combating late payments in commercial transactions have been implemented in the Austrian Civil Code ("ABGB") and the Austrian Commercial Code ("UGB").

2. Is there a standard payment term set out in law? If so, what is it?

The standard payment term is 30 days.

3. What are the circumstances in which parties may contractually agree to extend payment beyond the standard payment term?

An extension of the payment term up to 60 days does not involve any specific requirements. § 459 (3) UGB stipulates that the arrangement of a payment period of up to 60 days is in no way grossly disadvantageous and therefore permissible under Austrian law. 

When extending a payment period beyond 60 days, the following must be considered:

  • Evidence that there is no reason to consider that the payment term is contrary to good faith or fair dealing;
  • Evidence that the agreed-upon payment term is in line with the commercial practice in the industry or region;
  • Evidence that the payment term reflects the nature of the products or services. 

4. May an obligation beyond the standard payment term be evidenced in a PO?

A contract is validly concluded if the terms of the offer are clear at the moment when the offer is accepted. The PO is issued after the offer has been accepted and is, therefore, not part of the contractual terms, but is evidence for the terms of the accepted offer. In exceptional circumstances, the PO is to be considered a new offer subsequently accepted by the contractor. This must be assessed on a case-by-case basis. A unilateral declaration regarding payment terms, however, is not possible unless this has been expressly agreed upon in the basic contract.

In the case of payment periods exceeding 60 days, as previously mentioned this must be expressly agreed upon in the respective contract.  

5. Are there any penalties for breach of payment term legislation other that a civil claim of the seller?

There is no statutory penalty for a breach of payment term regulations, but the supplier is entitled to claim interest, an amount of EUR 40 per claim and the costs of bringing the action and recovering debt. If the respective conditions under Austrian civil law are met, the supplier may also demand compensation for the damage caused by delay.  

However, please note the special provisions concerning COVID-19 (see the question below).

6. Is there any special legislation regarding payment obligations for the COVID-19 situation?

There is no special legislation concerning the statutory payment periods in general. 

However, debtors do not currently have to pay any costs for out-of-court collection measures (e.g. a debt collection agency) for default of payment even if the parties made other arrangements. 

In the event of default of payment, a debtor shall not pay more than the statutory interest pursuant to § 1000 (1) ABGB (4% p.a.) if:

  1. the contract was agreed upon before 1 April 2020;
  2. the payment is due between 1 April 2020 and 30 June 2020; and
  3. the reason for the delay in payment is that the debtor's economic capacity has been seriously affected as a result of the COVID 19 pandemic.   

There is also a special rule concerning rental payments. The landlord is not entitled to terminate the lease agreement if the tenant is not able to pay the rent due to COVID-19.  

In addition, there is a special regulation concerning consumer credit agreements concluded before 15 March 2020. In these cases, it is possible – under certain circumstances – to suspend the lender's claims for three months.

7. Any additional comments

If the payment terms are agreed upon in GTC, the general regulations regarding the inclusion of GTC clauses (especially § 864a of the Austrian Civil Code and § 6 (3) of the Austrian Consumer Act) must be observed. Hence, agreements on payment terms must not be surprising or non-transparent.

Picture of Johannes Juranek
Johannes Juranek
Managing Partner
Vienna