Austria shows stringent institutional and regulatory framework conditions, especially complex regulatory procedures, and underperforms in terms of the insolvency regime. The 2017 Insolvency Law Amendment Act allows for a full discharge of debts after a period of 5 years. Moreover, the 2017 Digital Roadmap sets out 150 measures for promoting e-government, open data, open government and open source. E-Foundation for instance allows sole proprietorships and single person private limited companies establishing entirely online via the business service portal (usp.gv.at) that also serves as a central platform for e-government services and one-stop shop for e-procurement. In addition, both, the 2017 Deregulation and Deregulation Principles Acts aim to reduce bureaucratic burdens.
OECD SME and Entrepreneurship Outlook 2019
Chapter 10. Austria
Figure 10.1. Structure and performance of the SME sector in Austria
Sources: Charts A, C, D, E: OECD Structural and Demographic Business Statistics database, http://dx.doi.org/10.1787/sdbs-data-en; Chart B: Wirtschaftskammer Österreich (WKO) (creations) and OECD SME Scoreboard (bankruptcies).
SME business conditions and access to strategic resources
Institutional and regulatory framework
Market conditions
Market conditions are hampered by regulation and a lack of competition in some sectors. Professional services remain strictly regulated in Austria and retail trade is impacted by the high number of licences and permits needed to engage in commercial activity. The small number of mobile network operators raises challenges for the broadband deployment. The 2016 Recognition and Evaluation Act eases the procedures for recognising professional qualifications obtained abroad. Since 2015, small facilities, especially for the retail sector, are exempted from authorisation procedures. SMEs are also eligible to an increasing number of licence exemptions when they open small business premises that adhere to health and safety rules. And the 2017 amendment of the Industrial Code abolishes fees and bureaucratic requirements for business license registration.
Infrastructure
Austria invests a high share of GDP in ICT, and its ICT infrastructure is above OECD standards in terms of security and affordability. However, fixed and mobile broadband penetration remains comparatively limited. In its “broadband offensive”, EUR 1 billion were earmarked over 2017-18 to generalise high-speed internet, including in all SMEs and schools by 2020, with matching funds by private operators. The Austrian 5G Strategy aims to speed up the deployment of 5G digital infrastructure, close the infrastructure gaps between urban and rural areas, improve energy efficiency with digital applications and promote smart traffic systems
Access to finance
New SME lending in Austria has been in continuous decline since 2009, except for a slight bump in 2011. Venture capital investments remain volatile, and crowdfunding is gaining importance. A comprehensive start-up package (with a total EUR 185 million for three years) was launched in 2016 with a view to promoting business angel, seed and pre-seed funding, university spin-offs and guarantees. The Financing Company for SMEs was also introduced in 2017 to improve SME access to venture capital. In addition the regulatory framework for alternative financing, especially crowdfunding, was reformed in 2015 and new standards raise investor protection.
Access to skills
The apprenticeship and skilled worker training are main features of the Austrian education system that has one of the highest OECD enrolment rates in vocational education with a strong enterprise-based component. The Federal Government is committed to raise the attractiveness and innovativeness of its apprenticeship system. By the summer of 2019, all apprenticeships will undergo a screening process with a view to better meeting the current economic standards. In parallel, despite recent improvements, few Austrian SMEs offer ICT training to their employees (35% in 2016). Since 2017, the SME Digital Programme provides a mix of support activities, events, webinars, diagnostic tools and training for raising the digital profile of SMEs.
Access to innovation assets
Austrian SMEs are active in R&D and innovation and well integrated into knowledge networks as compared to their OECD counterparts but they have been relatively slow in adopting ICT innovations. The new 2017 policy package for growth and employment offers 10% subsidies to SMEs investing on digitalisation. The 2016 Open Innovation Strategy aims to improve digital literacy among actors through new forms of co-operation. Pilot fabrics experiment Industry 4.0 production processes and help SMEs test technologies in partnership with large firms and research laboratories. In 2016, Austria also adopted a comprehensive Intellectual Property Strategy in order to enable SMEs better protect and exploit their IP. And in 2018, the tax incentive for in-house R&D increased from 12 % to 14 % to stimulate SME activities.
The full country profile is available at https://doi.org/10.1787/34907e9c-en
References
European Commission (2018), 2018 SBA Fact Sheet Austria, https://ec.europa.eu/docsroom/documents/32581/attachments/2/translations/en/renditions/native.
European Commission (2017), 2017 SBA Fact Sheet Austria, https://ec.europa.eu/docsroom/documents/29489 (accessed on 09 August 2018).
OECD (2017), OECD Economic Surveys: Austria 2017, OECD Publishing, Paris, http://dx.doi.org/10.1787/eco_surveys-aut-2017-en.