Austria is known as one of the best countries in Europe, and this is not surprising, as it is famous for its economic stability and high standards of living. Therefore, investing in Austrian real estate is an excellent solution to preserve and even increase your assets. Many of our clients have a question: “Can a foreign legal entity buy property in Austria?”. That is why in this article we will explain this in detail.
To begin with, each federal state of Austria has its own separate law on the transfer of real estate (Grundverkehrsgesetz). The titles and provisions of these laws differ slightly, but they are all united by one idea and describe the conditions for the transfer/acquisition of real estate, including by foreigners.
Under Austrian law, legal entities, as well as individuals, can be both Austrian and foreign.
In almost all federal states, foreigners are:
- Individuals who do not have Austrian citizenship;
- Legal entities that are domiciled abroad;
- Legal entities in which foreigners hold the majority of shares/participations;
*Please note that a legal entity incorporated in Austria in which foreigners (persons who are not Austrian or EU citizens) are majority owners (holding more than 50% of the shares) is also considered a foreign legal entity.
- Associations with their registered office in Austria whose voting members are predominantly foreigners or whose governing body is predominantly foreigners.
*For the purposes of these laws, citizens of the European Union (EU) are NOT considered foreigners and are treated as Austrians in terms of real estate acquisition rights.
As for foreigners and foreign legal entities, the rules for purchasing real estate are similar. Each foreign individual/legal entity must obtain a permit/approval/approval from the authority responsible for the transfer of real estate.
For example, in Vienna, this authority is the Staatsbürgerschaft (MA 35), in Salzburg, the Magistrat Salzburg is responsible for issuing permits, and in Lower Austria, the Amt der NÖ Landesregierung.
The general prerequisites for obtaining a permit to acquire real estate are:
- cultural, social or economic interest in entering into such a legal transaction;
- no threat of violation of Austria’s national political interests.
For a more detailed definition of the concepts of “cultural, social, economic interest and national political interest”, please refer to our previous article on the acquisition of Austrian real estate by individuals.
However, special prerequisites can be determined by each federal state individually. For example, § 25 Z. 2 and Z. 4 S. of the new Grundverkehrsgesetz of Salzburg, which came into force on 25.05.2023, stipulates that a permit for the acquisition of real estate for a primary or secondary residence cannot be issued to a foreign legal entity, as only an individual can reside in such real estate, who must personally obtain a permit from the responsible authority.
In order to obtain a permit for the acquisition of real estate by a foreign legal entity, the following package of documents must be submitted to the responsible authority:
- application for a permit (application forms are available on the website of the real estate authorities responsible for the distribution of real estate in each federal state);
- actual extract from the commercial register (on the legal entity purchasing the property);
- Articles of association of the legal entity purchasing the property;
- copy or a draft of the sale and purchase agreement;
- declaration on the use of the real estate object;
- plot plan;
- actual extract from the land register (the land register in German can be viewed at the court, at a notary public and on the Internet).
It is worth noting that the responsible authorities have broad discretionary powers to issue permits for the acquisition of real estate. Therefore, even a perfectly prepared package of documents does not provide a 100% guarantee of a positive decision. According to our observations, some federal states have a better attitude to the issuance of such permits, while others have a worse attitude.
Thus, for example, in Vienna, Lower and Upper Austria, Carinthia and Styria, obtaining a permit for both legal entities and individuals is more realistic than in other federal states.
To address this situation, the VigoImmigration team can offer alternative solutions. One of them is the registration of two legal entities in Austria. Using this life hack, you will not need to obtain a permit to purchase real estate. The founders of the first legal entity may be non-Austrian/EU citizens. The founder of the second company will be the aforementioned legal entity. As a result, the real estate can be purchased in the name of the second legal entity, which will be considered Austrian by law and will not require a real estate purchase permit.
As you can see, solutions can be found even in the most difficult situations, and VigoImmobilien real estate agency will be happy to help you with this! For more information, just call +4366499877599 or write to us at [email protected].
