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Arbitral proceedings

Starting an arbitration proceeding
What is needed to commence arbitration?

Austrian arbitration law provides no specific rules as to the commencement of an arbitration proceeding.

In ad hoc arbitrations, the arbitral proceeding is typically commenced by sending a request for the appointment of an arbitrator to the other party. Pursuant to Section 587(4) of the Code of Civil Procedure, the request must state what claim is being asserted and which arbitration agreement the requesting party refers to. The request is considered to interrupt statutes of limitations at the time that the other party receives the request.

Institutional arbitral proceedings are usually commenced by filing a statement of claim with the institution. Statutes of limitations are typically interrupted when the institution receives the statement of claim. 

Limitation periods
Are there any limitation periods for the commencement of arbitration?

There are no specific limitation periods for the commencement of arbitration under Austrian law. However, the parties are free to agree on a limitation period in the arbitration agreement.

Procedural rules
Are there any procedural rules that arbitrators must follow?

The arbitral tribunal must follow the rules of procedure agreed on by the parties. Failing such agreement, the arbitral tribunal can proceed in any manner that it deems appropriate. In any event, the arbitrators must follow the mandatory provisions of Austrian arbitration law (eg, granting each party the right to be heard). 

Dissenting arbitrators
Are dissenting opinions permitted under the law of your jurisdiction?

Austrian law does not expressly permit dissenting opinions, but does provide for decisions to be made by a majority vote and stipulates that the presiding arbitrator must provide reasons for any omitted signature on the award. Commentators argue that this can be regarded as an implicit admittance of dissenting opinions under Austrian law.

In a similar vein, the Supreme Court recently acknowledged that dissenting opinions are permissible in arbitrations under the International Chamber of Commerce Rules and held that a dissenting opinion need not be submitted in enforcement proceedings in Austria.

Judicial assistance
Can local courts intervene in proceedings?

Pursuant to Section 578 of the Code of Civil Procedure, Austrian courts can intervene only in very limited circumstances and on the request of a party. In particular, the court may act on a party’s request: 

  • to grant an interim or protective measure (Code of Civil Procedure Section 585);
  • if the parties cannot agree on a sole arbitrator (Code of Civil Procedure Section 587(2)(1));
  • if a party fails to appoint an arbitrator (Code of Civil Procedure Section 587(2)(4));
  • if several parties fail to jointly appoint an arbitrator (Code of Civil Procedure Section 587(5));
  • if the appointment cannot be made for other reasons or cannot be made in reasonable time (Code of Civil Procedure Section 587(6));
  • if a challenge to an arbitrator is unsuccessful and the challenging party requests the court to decide the challenge (Code of Civil Procedure Section 589(3)); or
  • if an arbitrator’s mandate has been terminated and the arbitrator does not resign or the other party does not agree to the termination (Code of Civil Procedure Section 590(2)).

Moreover, the arbitral tribunal may request judicial assistance from Austrian courts to:

  • enforce an interim or protective measure (Code of Civil Procedure Section 593); or
  • gather certain evidence for which the arbitral tribunal has no authority – that is, examining witnesses, compelling witnesses to attend the hearing, ordering document disclosure and requesting legal assistance by a foreign court (Code of Civil Procedure Section 602).

Can the local courts assist in choosing arbitrators?

If a party fails to appoint an arbitrator or the parties fail to agree on a sole arbitrator, either party may request the court to choose an arbitrator (Code of Civil Procedure Section 587(2)(1) and (4)). Similarly, the court may appoint an arbitrator on the request of a party if several parties fail to jointly appoint an arbitrator or if the appointment cannot be made for other reasons (Code of Civil Procedure Sections 587(5) and (6)).

What is the applicable law (and prevailing practice) where a respondent fails to participate in an arbitration? Can the courts compel parties to arbitrate? Can they issue subpoenas to third parties?

Section 600(2) of the Code of Civil Procedure governs default by a respondent in arbitral proceedings. In the absence of a contrary agreement by the parties, the arbitral tribunal will proceed with the arbitration without treating the respondent’s failure in itself as an admission of the claimant’s allegations. Thus, Austrian law does not allow a decision by default; nor can the courts compel parties to arbitrate.

Pursuant to Section 602 of the Code of Civil Procedure, the arbitral tribunal can request the courts to provide judicial assistance through judicial acts for which the arbitrators have no authority. This is not limited to evidentiary acts, but encompasses any form of judicial assistance, including issuing subpoenas to third parties. Moreover, unlike the United Nations Commission on International Trade Law Model Law, Austrian arbitration law explicitly allows Austrian courts to request a foreign court or authority to perform judicial acts.

Third parties
In what instances can third parties be bound by an arbitration agreement or award?

Austrian arbitration law does not explicitly provide for the extension of an arbitration agreement to third parties.

In the past, Austrian courts have been reluctant to extend the scope of an arbitration agreement to non-signatories. However, arbitration agreements have been extended to legal successors and third-party beneficiaries. Thus far, there have been no court decisions on the application of the group of companies doctrine and with regard to the existing body of case law, its seems highly unlikely that the Supreme Court would uphold an application of the doctrine.

Default language and seat
Unless agreed by the parties, what is the default language and location for arbitrations?

In the absence of an agreement by the parties, the arbitral tribunal will determine the language to be used in the proceedings (Code of Civil Procedure Section 596). 

Likewise, failing an agreement by the parties, the seat will be determined by the arbitral tribunal, having regard to the circumstances of the case, including the convenience of such place for the parties (Code of Civil Procedure Section 595(1)). 

Gathering evidence
How is evidence obtained by the tribunal?

Pursuant to Section 599(1) of the Code of Civil Procedure, the arbitral tribunal has broad discretion as to the obtaining of evidence. It is authorised to rule on the admissibility of the taking of evidence, to carry out such taking of evidence and to freely evaluate the result thereof.

The arbitral tribunal can also request the courts to assist in gathering evidence for which the arbitral tribunal has no authority (Code of Civil Procedure Section 602).

What kinds of evidence are acceptable?

It is for the arbitral tribunal to decide on the admissibility of evidence (Code of Civil Procedure Section 599(1)). The tribunal is thus not bound to the means of evidence admissible in state court proceedings. 

Confidentiality
Is confidentiality ensured?

Although Austrian arbitration law does not contain an express stipulation of confidentiality, the proceedings and hearing are not public. Commentators note that Austrian law allows for the argument that a confidentiality obligation is implied by law. However, to ensure that documents produced in the course of the proceedings are kept confidential, the parties should include a confidentiality obligation in the arbitration agreement.

Can information in arbitral proceedings be disclosed in subsequent proceedings?

Austrian law does not explicitly stipulate confidentiality in arbitral proceedings. Thus, information might be disclosed in subsequent proceedings if the parties have not explicitly or implicitly agreed on a duty of confidentiality.

Ethical codes
What ethical codes and other professional standards, if any, apply to counsel and arbitrators conducting proceedings in your jurisdiction?

Members of the Austrian Bar are subject to the Austrian lawyers’ code of conduct and must comply with it when acting in Austria or abroad. However, the code of conduct contains no specific regulations regarding arbitral proceedings.

As provided by the charter of core principles of the European legal profession and the Code of Conduct for European lawyers (CCBE), Austrian professional standards also apply to lawyers from the European Union participating in arbitral proceedings seated in Austria (CCBE Articles 4(1) and 5(4)). 

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