Are administrative violations trivial offenses? According to the current legal situation, this is probably no longer true in the area of administrative penalties, as the number of relevant infringements and the range of penalties have been significantly increased in recent years.

But who in a company is responsible under administrative criminal law? Who is liable if a limited liability company as a license holder does not provide proper driver information? According to § 9 of the Administrative Offenses Act, these are the persons who are appointed to represent the company externally, i.e. the managing directors. If several managing directors are appointed, they are jointly liable. Special provisions exist, for example, in trade law, where the commercial managing director is liable, but in the absence of such a managing director, the commercial managing director is liable again. It is also important to note that administrative criminal law differs from judicial criminal law in that the presumption of innocence does not apply. Consequently, it is permissible for the authorities to at least assume negligence and the opposite must first be proven.

This liability regulation for managing directors is not only seen by some as double punishment, but often those responsible under criminal law have nothing to do with the criminal offense or even have no possibility of even becoming aware of the violation. If such penalties are imposed on managers, this also means that they are excluded from public tenders. Finally, there may also be negative effects on work discipline in relation to administrative penalties, as employees do not have to expect any sanctions (at least not from the authorities) in the event of an administrative offense.

In order to counteract all these unfavorable consequences, however, the law also provides for various structuring options, which are even mandatory at the request of the authority (VStG § 9 para. 2).

For example, if several managing directors have been appointed, one or more of them could be appointed as the responsible representative (s) either for selected areas of the company or for the entire company. However, apart from the persons already authorized to represent the company, it is also possible to appoint other persons, such as employees, whereby this is only permitted for selected areas, namely for areas that are sufficiently limited in terms of location and subject matter.

However, such an agent must meet certain requirements. Not only must the principal place of residence be in Austria (which, however, does not apply to EEA member states if service is ensured in administrative criminal proceedings, e.g. through international treaties), but also written and unambiguous proof of the authorized representative’s consent and corresponding powers on the part of the authorized representative to ensure that he can take the necessary precautions in his area of responsibility. If the agent is only to be active for selected areas of the company, a clear demarcation must also be made so that the authorities are not put in the position of having to investigate the company.

In such cases, however, the managing directors are liable despite the appointment of a responsible representative if they did not intentionally prevent the offense, whereas the responsible representative can avoid liability if he can prove that compliance with the administrative regulation was unreasonable for him (Section 9 VStG para. 5 and 6). Legal entities and registered partnerships are also jointly and severally liable for fines imposed on persons appointed to represent them externally or on a responsible agent, other consequences of injustice measured in monetary terms and the costs of proceedings.

The responsible agent, on the other hand, is naturally exposed to a greater risk, which is usually taken into account in the remuneration. However, an agreement is also possible whereby all procedural and defense costs are reimbursed by the company, and a promise to bear all financial disadvantages, including the penalty, after the infringement has been completed is also permissible. In contrast, an agreement that all future administrative penalties are to be reimbursed by the company would be immoral and therefore invalid.

Various special provisions still exist, primarily to avoid circumvention. For example, according to § 23 of the Labor Inspection Act, only senior employees may assume the function of such a representative. Furthermore, the appointment only becomes legally effective once the responsible labor inspectorate has received written notification including proof of the appointee’s consent. According to § 28a of the Aliens Employment Act, the customs authority must be informed in the same way.

It should also be noted in connection with administrative penalties that, since the introduction of the 2011 Tax Amendment Act, these have suffered the same fate as penalties or fines imposed by courts or bodies of the European Union. According to Section 20 para. 1 no. 5 of the Income Tax Act, these are no longer deductible as business expenses, just like cash and non-cash benefits, the granting and acceptance of which is subject to judicial sanction, or association fines under the Association Liability Act. The argument here is that the tax deductibility of penalties would undermine both their punitive nature and their preventative effect.