With the amendment of the Austrian Media Act extended duties of disclosure for website/newsletter provider became effective as of 1 July 2012. The aim is to ensure "complete transparency with regard to any kind and any legal form of direct or indirect share in a media owner". In fact, the amendment leads to the contrary due to information overload causing issues for the affected media owners. The extensive disclosure duties do apply to all media of media owner located in Austria. Thus, the regulation does not apply to websites/newsletter of provider having their headquarters/registered office abroad, unless the medium is entirely or almost exclusively distributed in/directed to Austria ("foreign media" pursuant to Sec 50 Media Act). Therefore, websites/newsletter run by Austrian subsidiaries of foreign multinational companies are covered by the disclosure duties as well as websites/newsletter of foreign media owner which are entirely or almost exclusively distributed in/directed to Austria. In practise, the main issue in international cases is to establish the level of focus on Austria that might trigger the appliance of the Austrian provisions.
Legal situation until 31 June 2012
Sec 25 of the Media Act old version already stipulated (extensive) disclosure duties for media owners. Initially, the provision aimed at disclosure of the legal (organizational), economical and content-related holder of press companies. The idea was to inform the public about the owner of media companies/publications for verification of hidden interests/political influence involved.
The major adjustment of the Media Act in 2005 clarified by explicit inclusion of "periodical (recurring) electronic media" that also websites and newsletters are deemed to be media within the meaning of the Media Act. Consequently, it is established that the disclosure duties do also apply to website operators and creators of newsletters, although these duties were tailored to press companies and do not quite fit to new media.
Thus, website operators and creators of newsletters had to disclose their name/company name, subject of the company, residential address/registered office and to render a declaration on their editorial policy, which is the basic line represented by the medium. Latter might be justified for the above stated reasons for press companies, but does not fit for online media which are mostly company websites. In addition, associations and in particular companies had to indicate their executive officers, members of the management board and supervisory board members, as well as shareholders with a direct or indirect share of more than 25% and shareholders with a indirect total share of more than 50%, specifying the type and size of the share. If the shareholders were themselves companies, the major shareholders of these mother companies had to be indicated as well. This complex regulations already lead to quite confusing imprints. In addition, the Austrian E-Commerce Act which is based on the respective Directive as well as the distance selling provisions and the Austrian Commercial Code stipulate additional disclosure duties. As a result, imprints in the online field were too lengthy and far too complex to enable recipients to get comprehend the relevant information.
Legal situation as of 1 July 2012
Non-regarding the already existing issues, the adjustment to the Media Act even extended the disclosure duties in the context of providing more transparency: In addition, the ownership, shareholding, share and voting rights proportion, not only of major shareholders, but of all direct or indirect shareholders has to be indicated and any undisclosed shareholder or fiduciary relationships have to be disclosed. Further, all beneficiaries and shareholders of incorporated foundations and companies have to be indicated unlimited!
Due to the complex regulations, the implementation of a mere imprint finally became a risky, large-scale project, especially for multi-corporate enterprises. This is even more true to the increase of the administrative penalties for non-compliance from EUR 2,180 to EUR 20,000. Besides, a relevant violation of disclosure duties is subject to omission claims under the Act Against Unfair Competition.
Lifeline for "small" "foreign" websites
There is, however, limited hope for website owner: If the medium is only deemed being a small website/newsletter pursuant to Sec 25 Para 5 of the Media Act, only limited disclosure duties apply. In this case it is sufficient to indicate name/company name, object of the company and residential address/registered office of the media owner. The exemption applies if websites/newsletters serve the mere presentation of the media owner and its products and does not aim to influence the public opinion.
The wording of the exemption is rather vague and there is a lack of respective administrative and court decisions. However, the explanatory remarks of the legislator render following example: If the owner of a market garden presents his shop and his products on his website, only, it is deemed being "small". If the media also contains articles of the owner or a third party criticizing the climate warming or other ecological topics, it is considered to be suitable to influence the public opinion and the privilege of limited disclosure duties does no longer apply. Thus, the operator of websites/newsletters shall restrict himself to the presentation of his business/services and refrain from making any general political statements. Besides the quite ambiguous wording of the exemption and the reluctant interpretation of the legislator many international companies where due to psychological and marketing reasons quite reluctant to have their internet presence classified as a small website, only. In practice, only a limited number of companies thus relied on the exemption for small websites. This will most likely change due to the additional requirements which are especially cumbersome to subsidiaries of international companies who do not like to disclose all the information on their shareholders.
Conclusion
The recent amendment of the Media Act has lead to a further inflation of the disclosure duties which intensifies the problem of information overload. The substantial increase of the maximum penalty and the respective risk for claims under the Act Against Unfair Competition makes non-compliance quite risky. In practice, more companies will rely on the exception for small websites and newsletter.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
