Austria

Last updated: 26/11/2008

CENTRAL AUTHORITY FOR REPORTING

In cases outlined under Section 8a subsection 1 of the Austrian Lawyers’ Code (Rechtsanwaltsordnung – (RAO) any lawyer must inform the Home Secretary (Federal Office of Criminal Investigation – Bundeskriminalamt) without delay if he knows, suspects or has a legitimate reason to assume that a certain transaction involves money laundering (Section 165 Austrian Criminal Code – Strafgesetzbuch, (StGB) or the financing of terrorism (Section 278d StGB) (Notification due to suspicion – Verdachtsmeldung) (Section 8c subsection 1 RAO).

Click on the following link to have access to the contact details for the General Directorate for Public Security of the Home Office to which such notifications due to suspicion shall be addressed.

ANTI-MONEY LAUNDERING REGULATOR(S)

Not Applicable.

HAS THE THIRD EU MONEY LAUNDERING DIRECTIVE BEEN IMPLEMENTED? IF NOT, WHEN IS IT EXPECTED TO BE IMPLEMENTED? 

The third EU Money Laundering Directive has been implemented, inter alia, by incorporation into the RAO by Federal Law Gazette I No. 111/2007 (BGBl I Nr. 111/2007). The new provisions of the RAO entered into force on 29 December 2007.

LIST THE LAWS REGARDING ANTI-MONEY LAUNDERING, INDICATING WHICH LAWS ARE APPLICABLE TO LAWYERS.

The following laws include provisions on anti money laundering:

• Rechtsanwaltsordnung (RAO) - applicable to lawyers;
• Austrian Banking Act (Bankwesengesetz);
• Austrian Trade Act (Gewerbeordnung);
• Austrian Insurance Supervision Act (Versicherungsaufsichtsgesetz);
• Austrian Gambling Act (Glücksspielgesetz);
• Austrian Stock Exchange Act (Börsegesetz);
• Austrian Securities Supervision Act (Wertpapieraufsichtsgesetz);
• Austrian Code on Notaries Public (Notariatsordnung);
• Austrian Guidelines on the Exercise of the Chartered Accountants Profession (Wirtschaftstreuhandberufs-Ausübungsrichtlinien).

The current versions of the laws can be downloaded here.

ARE VISITING LAWYERS SUBJECT TO LOCAL LAWS REGARDING ANTI-MONEY LAUNDERING, AND, IF SO, TO WHAT EXTENT?

European lawyers in terms of the Federal Act on the Free Trade in Services and the Establishment of European Attorneys-at-Law in Austria (EuRAG) (citizens of EU or EEA member states who are entitled to practice law in a EU / EEA jurisdiction other than Austria) are subject to the same rights and obligations as Austrian lawyers. Thus, the RAO provisions including the anti-money laundering apply to visiting lawyers wanting to practice in Austria.

LIST ANY MONEY LAUNDERING GUIDANCE FOR LAWYERS (FOR EXAMPLE, LAW SOCIETY OR BAR ASSOCIATION GUIDELINES) CURRENTLY IN PLACE.

No information available.

IS THE LAW SOCIETY/BAR ASSOCIATION INVOLVED IN SUPERVISING OR ENFORCING COMPLIANCE WITH ANTI-MONEY LAUNDERING REGULATIONS?

According to information available – no.

DESCRIBE CLIENT DUE DILIGENCE REQUIREMENTS, INCLUDING WHEN IT MUST BE UNDERTAKEN BY LAWYERS.

Pursuant to Section 40 of the Austrian Banking Act credit and financial institutions shall determine and verify the identity of any new client

1. Upon establishment of a permanent business relationship;
2. For individual transactions of at least EUR 15.000 or any other currency equivalent to EUR 15.000;
3. In case of suspicion or if there is a legitimate reason to assume that the client is a member of a terrorist group (Section 278b StGB) or participates in transactions serving money laundering (Section 165 StGB) or the financing of terrorism (Section 278d StGB);
4. Upon payment or drawings from savings deposits of EUR 15.000 or any other currency equivalent to EUR 15.000;
5. In case of doubt in respect of the authenticity or appropriateness of client identification data previously received.
   

Further, banks and financial institutions are obligated to ask clients for confirmation whether they act on someone else’s behalf. If this is the case, the client must reveal the beneficiary’s identity.

In case of any transaction listed in Section 8a subsection 1 RAO any lawyer is obligated to determine and verify the client’s and the beneficial owner’s identity.

• Upon establishment of a business relationship intended for a longer period prior to acceptance of such mandate;
• In case of any transaction with a value of at least EUR 15.000;
• If he knows, suspects or has a legitimate reason to assume that a certain transaction serves money laundering (Section 165 StGB) or the financing of terrorism (Section 278d StGB);
• He doubts the authenticity or appropriateness of the identification data received.

DOES YOUR COUNTRY FOLLOW A RISK-BASED APPROACH TO CLIENT DUE DILIGENCE BY LAWYERS? 

Please see below.

ARE THERE ENHANCED DUE DILIGENCE MEASURES FOR CERTAIN TYPES OF CLIENTS, FOR EXAMPLE, POLITICALLY EXPOSED PERSONS?

Enhanced due diligence measures are required in cases with a higher risk, e.g. in respect of long distance business relationships (Ferngeschäft) (Section 8b Subsection 3 RAO) or if politically exposed persons resident in another EU member state or outside the EU (Section 8f RAO) are involved.

Long Distant Transactions:

Section 8b Subsection 3 RAO: If a client is not physically present upon establishment of a business relationship or during execution of any transaction (long distance business relationship), any lawyer is obligated to take additional adequate and probative measures to verify the party’s identity and to ensure that the client’s first payment within the scope of the transaction concerned is carried out through an account opened in the client's name with a credit institution to which EU Directive EC/60/2005 applies.

Politically Exposed Persons:

Section 8f subsection 3 RAO: Establishment of a business relationship with a politically exposed person requires prior consent of the respective lawyer. Further, the respective lawyer is obligated to take adequate measures to verify the sources of the funds used in the transaction or within the scope of the business relationship and subject the business relationship to increased monitoring.

ARE THERE SIMPLIFIED DUE DILIGENCE MEASURES FOR CERTAIN TYPES OF CLIENTS, FOR EXAMPLE, LISTED COMPANIES?

Section 8e RAO defines simplified due diligence measures regarding certain authorities or public institutions, e.g. listed companies whose securities are admitted to trade on a regulated market in terms of Section 2 item 37 Austrian Banking Act or domestic authorities. In these cases the obligations set out under Section 8b RAO do not apply (determination and verification of client’s and beneficial owner’s identity, obtaining information on the purpose and the kind of the business relationship, monitoring of the business relationship and updating of the information). However, the lawyer has to obtain enough information to determine that such exemption applies to the client concerned.

ARE LAWYERS PERMITTED TO RELY ON THIRD PARTY DUE DILIGENCE? IF YES, PLEASE DESCRIBE.

No.

WHEN IS A LAWYER UNDER AN OBLIGATION TO REPORT SUSPICIOUS TRANSACTIONS?

Pursuant to Section 8c subsection 1 RAO any lawyer must inform the Home Secretary (Federal Office of Criminal Investigation – Bundeskriminalamt) without delay in cases set out under Section 8a subsection 1 RAO if he knows, suspects or has a legitimate reason to assume that a certain transaction serves money laundering (Section 165 StGB) or the financing of terrorism (Section 278d StGB) (Notification due to suspicion – Verdachtsmeldung).

Section 8a subsection 1 RAO includes:

1. The purchase and sale of real estate property or enterprises;
2. Administration of money, securities or other assets, opening or administration of bank accounts, savings accounts or accounts regarding securities; or
3. Foundation, operation or administration of trust companies, companies or similar structures, including trusts or foundations, and obtaining the means necessary for the foundation, operation or administration of such companies.

DOES ATTORNEY/CLIENT PRIVILEGE AND/OR DUTIES OF CONFIDENTIALITY PROVIDE A DEFENCE OR PARTIAL/TOTAL EXCEPTION TO THE REQUIREMENT TO REPORT SUSPICIOUS TRANSACTIONS?

Please see above. Client confidentiality rules do not provide a defence to a lawyer’s failure to report any transaction suspected of involving money laundering. Further, any disclosure made to the Home Secretary by a lawyer must be bona fide and does not breach any client confidentiality or legal professional privilege rules in place as a result of the lawyer-client relationship.

DOES LOCAL LAW PROVIDE ANY CRIMINAL AND/OR CIVIL INDEMNITY TO A LAWYER WHO HAS REPORTED A SUSPICIOUS TRANSACTION?

If any lawyer informs the Home Secretary (Federal Office of Criminal Investigation) in good faith, he does not breach his obligation of confidentiality. Further such information does not trigger any negative consequences for the lawyer (Section 9 subsection 5 RAO).

ONCE A SUSPICIOUS TRANSACTION REPORT HAS BEEN FILED, IS A LAWYER ALLOWED TO PROCEED WITH THE LEGAL ADVICE/TRANSACTION, AND, IF SO, MUST CONSENT FROM AUTHORITIES BE OBTAINED FIRST?

If any lawyer has to make a notification pursuant to Section 8c subsection 1 RAO, he may not execute the transaction prior to notification of the Home Secretary (Federal Office of Criminal Investigation).

The lawyer is entitled to request for a decision from the Home Secretary (Federal Office of Criminal Investigation) as to whether or not there are any concerns regarding the immediate execution of the transaction. If the Home Secretary (Federal Office of Criminal Investigation) does not reply until the end of the following working day, the transaction may be carried out without delay. The Home Secretary (Federal Office of Criminal Investigation) is authorised to prohibit or to postpone the transaction (Section 8c subsection 2 and 3 RAO).

IS THERE A TIPPING-OFF PROHIBITION? IF YES, PLEASE DESCRIBE.

Yes, there is. According to Section 8c subsection 1a RAO lawyers may only inform the authorities responsible for fighting money laundering and terrorism, the bar association and the law enforcement authorities of a notification to the Home Secretary (Federal Office of Criminal Investigation). Such information may be passed on, however, within the respective law firm. Further, such tipping-off prohibition does not prevent the lawyer to try to prevent the client to commit any unlawful act.

DESCRIBE ANY RESTRICTIONS ON ACCEPTING A NEW CLIENT.

In case of any transaction listed in Section 8a (1) RAO any lawyer is obligated to verify the client’s and the beneficial owner’s identity.

• Upon establishment of a business relationship intended for a longer period prior to acceptance of such mandate;
• In case of any transaction with a value of at least EUR 15.000;
• If he knows, suspects or has a legitimate reason to assume that a certain transaction serves money laundering (Section 165 StGB) or the financing of terrorism (Section 278d StGB);
• If he doubts the authenticity or appropriateness of the identification data received.

If the lawyer is not or no longer able to determine and verify the identity of the client and the beneficial owner or to obtain information on the purpose and the kind of the business relationship, he is not allowed to start the business relation (Section 8b subsection 7 RAO).

ARE THERE ONGOING MONITORING REQUIREMENTS FOR EXISTING CLIENTS? IF YES, PLEASE DESCRIBE.

Any lawyer is obligated to obtain information on the purpose and the kind of the business relationship and to monitor the business relationship constantly. Such monitoring includes verification of the transactions conducted in the course of the business relationship. If the lawyer is not or no longer able to determine and verify the identity of the client and the beneficial owner or to obtain information on the purpose and the kind of the business relationship, an already existing business relationship shall be terminated (Section 8b subsection 6 and 7 RAO).

DESCRIBE ANY OTHER WAYS IN WHICH LAWYERS ARE AFFECTED BY ANTI-MONEY LAUNDERING LEGISLATION.

No information available.

HAVE LAWYERS IN YOUR JURISDICTION BEEN IMPLICATED IN MONEY LAUNDERING, INCLUDING ANY TYPE OF COMPLAINT, ARREST OR PROSECUTION?

No information available.

HAS THE FINANCIAL ACTION TASK FORCE (FATF) CONDUCTED A MUTUAL EVALUATION OF THIS COUNTRY, AND, IF SO, WHAT WERE THE FINDINGS CONCERNING LAWYERS’ COMPLIANCE WITH THE FATF 40+9 RECOMMENDATIONS?

There is currently no mutual evaluation report on Austria by the Financial Action Task Force.