Country Listing

Austria Table of Contents


The Professions

The Regulation of the Professions (Gewerbeordnung) plays as important a role as do the chambers. The term Gewerbe, which can theoretically mean any kind of economic activity except large-scale production and services, is a concept that descended to modern Austria from the medieval system of crafts, guilds, and services. The term has no English equivalent but can best be described as the exercise of a particular profession or economic activity.

The Gewerbeordnung is a system that regulates the way a profession is exercised. The system, which regulates about 220 forms of economic activity, established certain standards: entry into a profession; operating regulations; methods for limiting price competition; rules governing permissible advertisement; exclusive franchises and licenses; shop-opening and price competition rules; market access controls; capital requirements; and local monopolies. In a variety of instances, the rules also provide for exemption from cartel law regulations (although the cartel law does not prohibit cartels but their abuse). Firms covered by these and similar regulations account for about 40 percent of total value added and investment in Austria and 45 percent of total employment. These firms are involved in such matters as professional services, wholesale and retail trade, insurance, banking, capital services, telecommunications, energy, and transportation.

The effect of the rules is to reduce competition in certain fields and to shelter those already admitted in these fields from excessive access as well as predatory practices by others, especially by larger firms. In a small country such as Austria, with many small villages and communities, the system serves largely to preserve the existing structure of economic activity and the position of local service providers who were established first in a community. It also protects consumers and others against fraudulent or unqualified service providers.

The chambers are the principal instruments that obtain protection or other forms of sheltered operation, largely because the chambers participate actively in the political process and are in the best position to make group or sector concerns felt at the national or provincial level. Some of these arrangements, such as sectoral support programs for transportation, mining, cement or paper, are still in effect, while others, such as those for textiles, clothing, leather, and paper, have been abolished.

Data as of December 1993