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Recognition and enforcement procedure
What is the formal procedure for seeking recognition and enforcement of a foreign judgment?
Once a foreign judgment has been declared enforceable in Austria, its execution follows the same rules as those for a domestic judgment. The enforcement of judgments is regulated by the Enforcement Act. Austrian enforcement law provides for various types of enforcement. A distinction is made as to whether the title to be enforced is, on the one hand, directed at a monetary claim or a claim for specific performance and, on the other hand, a claim against which asset enforcement is to be levied. The usual methods for the enforcement of judgments are:
- seizure of property and real property;
- attachment and transfer of receivables;
- compulsory leasing; and
- judicial auction.
The enforcement itself will be executed by a bailiff (eg, by seizing movable property or drawing up a list of the debtor’s assets). Bailiffs are executives of the court and must comply with the court’s orders and instructions. They are ordered to pursue enforcement measures until the order is complied with or it is apparent that it cannot be complied with.
What is the typical timeframe for the proceedings to grant recognition and enforcement?
It takes approximately one to two months for a decision on recognition and enforcement to be rendered at first instance. This period may be extended by a further three to six months if the decision is appealed. The duration of the execution proceedings depends on whether the debtor opposes the execution measures and whether, and to what extent, it possesses executable assets in Austria.
Further, the parties to enforcement proceedings may request a stay of enforcement proceedings. The Enforcement Act enumerates certain grounds for such a stay of proceedings, including an application to set aside the judgment or a motion for the suspension or alteration of the declaration of enforceability. If the stay of the enforcement proceedings might endanger the satisfaction of the enforcing creditor’s claim, the court may order an appropriate security deposit from the applicant.
What fees apply to applications for recognition and enforcement of foreign judgments?
The application for the declaration of enforceability is not subject to court fees in Austria.
For the application for enforcement, court fees must be paid under the Court Fees Act, which also applies to the enforcement of domestic judgments.
Must the applicant for recognition and enforcement provide security for costs?
No, the applicant for recognition and enforcement in general does not have to provide security for costs.
The Enforcement Act enumerates certain grounds for a stay of proceedings, including an application to set aside the judgment or a motion for the suspension or alteration of the declaration of enforceability. If the stay of the enforcement proceedings might endanger the satisfaction of the enforcing creditor’s claim, the court may order an appropriate security deposit from the applicant.
Are decisions on recognition and enforcement subject to appeal?
The decision on the declaration of enforceability may be appealed within four weeks (or, in certain cases, within two months) of its delivery to the parties of the proceedings. Where the opposing party appeals the decision, the applicant may file a reply within four weeks of being served the appeal. The decision on the declaration of enforceability may be appealed partially or in its entirety. The appealing party is not bound by the prohibition of novation (ie, it is not restricted to supporting or confuting only the facts that were brought forward during the first-instance proceedings).
If the motion for enforcement is already approved (due to a conjunct motion for declaration of enforceability and enforcement) before the declaration of enforceability has become legally binding, the enforcement proceedings must be initiated, but any realisation act must be refrained from until the declaration of enforceability has become final and legally binding. This ensures that the foreign judgment will be enforceable against the opposing party insofar as the opposing party’s assets may already be seized and attached but not yet realised. Realisation acts (eg, foreclosure sales of property and immovable goods) may be initiated once the declaration of enforceability becomes final.
How does the enforcing court address other costs issues arising in relation to the foreign judgment (eg, calculation of interest, exchange rates)?
Court costs and attorneys’ fees, as well as interest claims, are usually taken into account when deciding on the enforceability of a foreign judgment. When recognising a foreign judgment, Austrian courts do not convert the damage award into local currency. However, once the realisation acts are being undertaken, the award must be converted into local currency.
Interest rates that violate Austrian public policy (eg, an annual interest rate of 100%) are unenforceable.
Enforcement against third parties
To what extent can the courts enforce a foreign judgment against third parties?
The principles of agency or alter ego to enforce a judgment against a party that is not stated in the judgment do not apply in Austria. A foreign judgment can be enforced only against the party that is named as debtor in the foreign judgment.
Partial recognition and enforcement
Can the courts grant partial recognition and enforcement of foreign judgments?
The declaration of enforceability may recognise only parts of a judgment – for example, where certain parts of the judgment would violate Austrian public policy, but other parts meet the prerequisites for enforcement under Austrian law. For instance, the declaration of enforceability may be granted with respect to the awarded capital, but not for the awarded interest. However, such a separation comes into question only if it is possible to clearly and distinctly separate the admissible part from the part that would violate public policy.
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