Foreign Direct Investment in Austria

Overview by

FDI in Figures

With the country being located at the crossroad of East and Western Europe, direct foreign investment has always been important because of Austria's geographic location. After an economic slowdown due to the global crisis, the trend has once again been upward. Austria's strengths are its political stability, its location at the centre of Europe and a skilled work force.


Country Comparison For the Protection of Investors

  Austria OECD United States Germany
Index of Transaction Transparency* 3.0 6.0 7.0 5.0
Index of Manager’s Responsibility** 5.0 5.2 9.0 5.0
Index of Shareholders’ Power*** 4.0 6.8 9.0 5.0
Index of Investor Protection**** 4.0 6.0 8.3 5.0

Source: Doing Business

Note: *The Greater the Index, the More Transparent the Conditions of Transactions. **The Greater the Index, the More the Manager is Personally Responsible. *** The Greater the Index, the Easier it Will Be For Shareholders to Take Legal Action. **** The Greater the Index, the Higher the Level of Investor Protection.

Foreign Direct Investment 2007 2008 2009
FDI Inward Flow (million USD) 31,154 11,272 7,051
FDI Stock (million USD) 162,649 158,654 168,550
Performance Index*, Ranking on 141 Economies 35 91 82
Potential Index**, Ranking on 141 Economies 28 26 -
Number of Greenfield Investments*** 109 111 73
FDI Inwards (in % of GFCF****) 38.5 12.5 26.1
FDI Stock (in % of GDP) 43.9 38.4 43.8

Source: UNCTAD

Note: * The UNCTAD Inward FDI Performance Index is Based on a Ratio of the Country's Share in Global FDI Inflows and its Share in Global GDP. ** The UNCTAD Inward FDI Potential Index is Based on 12 Economic and Structural Variables Such as GDP, Foreign Trade, FDI, Infrastructures, Energy Use, R&D, Education, Country Risk. *** Green Field Investments Are a Form of Foreign Direct Investment Where a Parent Company Starts a New Venture in a Foreign Country By Constructing New Operational Facilities From the Ground Up. **** Gross Fixed Capital Formation (GFCF) Measures the Value of Additions to Fixed Assets Purchased By Business, Government and Households Less Disposals of Fixed Assets Sold Off or Scrapped.

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Why You Should Choose to Invest in Austria

Strong Points
Well developed infrastructures, a skilled and competent work force and high productivity are the country’s strong points. Austria has the headquarters of many firms and ranks 27th out of 181 economies with regard to ease of doing business. Austria also has a significant assemblage of pharmaceutical companies based in the country, thus developing a focus of biotechnological skills and attracting the big companies of this sector.
Weak Points
Austria’s weak points:
- Rigid labor practice;
- Lack of risk capital financing;
- restrictive migration laws;
- Strong dependance to Central and Eastern Europe where numerous investments have taken place (risky in case of a crisis in one of these countries);
- the restrictions of its internal market.
Government Measures to Motivate or Restrict FDI
Export incentives, political stability and low telecommunication costs make the Austrian business climate favorable. Another attractive factor is the fact that Austria has the most attactive taxation system in Europe and does not have a wealth tax or professional tax. Regional investment subsidies, tax exemptions on training (20%) and a training bonus for apprentices guarantees the country's appeal.
To mitigate the effects of the crisis, Austria has implemented mesures to reinforce the liquidity and the capitalization of the financial system.
Bilateral Investment Conventions Signed By Austria
Visit the UNCTAD website.

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Procedures Relative to Foreign Investment

Freedom of Establishment
Acquisition of Holdings
A majority holding interest in the capital of a local company is legal in Austria.
Obligation to Declare
In order to be able to run a company in Austria, professional ability proofs are required in nearly all activities, listed in a regulatory test: Gewerbeordnung, reconducted by the law n°194 of 1994.
Competent Organization For the Declaration
Federal Competition Authority (FCA)
Requests For Specific Authorizations
Licenses are required in sectors like banking and insurance. Moreover, the federal and state governments maintain at least a 51% share in all electricity generation and supply companies.
Find Investment Service Providers in Austria on

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Investment Opportunities

Investment Aid Agency
Austrian Development Cooperation
Austrian Business Agency
Advantage Austria
Tenders, Projects and Public Procurement
Tenders Info, Tenders in Austria
Ted - Tenders Electronic daily, Business opportunities in EU 27
DgMarket, Tenders Worldwide
Other Useful Resources
Vienna Business Agency

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