Buying a business name in Austria: sections 17 and 23 UGB distinguish the Firma from the business and prohibit an isolated empty transfer.
BRANDAUER Rechtsanwälte
Salzburg law firm for corporate, company and transaction law
Every transaction is handled by a coordinated team of lawyers, legal staff and specialists. In company acquisition matters we look at structure, contract, tax and liability together.
Anyone who wants to buy only the business name of an Austrian company must distinguish the registered name from the business itself. Section 17 UGB defines the Firma as the name of an entrepreneur registered in the Firmenbuch under which the entrepreneur operates and signs. Section 23 UGB prohibits selling that name without the business for which it is used.
An agreement stating that the buyer receives only the existing business name while the operation remains with the seller therefore reaches the core of the prohibition of an empty transfer. The contract review must first establish whether the request concerns the UGB business name. A trademark, an internet domain and the business are separate objects for review.
This post deals only with the isolated transfer of a business name under section 23 UGB. Trademark transfers, domain transfers, liability for legacy liabilities and continuation of a business after a person leaves are outside its scope.
Answer two questions about the business name and the related business.
Already know you want to get in touch? Go straight to the enquiry form.
First determine whether the request concerns the UGB business name or another identifier.
Reclassify the request: section 23 UGB provides that the business name cannot be sold without the business for which it is used.
Separately determine whether the buyer wants a trademark, a domain or the business itself. These objects must not be treated as the same as the business name.
Now compare the description of the business with the business name in the Firmenbuch. Section 23 UGB concerns the connection between these two objects.
Also record which trademark, domain or other identifiers are to be transferred. This post does not decide those separate rights.
A transfer of the wording of the business name alone does not fully describe the acquisition object. Add a clear description of the business for which the name is used.
If it remains unclear whether the request concerns a business name, trademark, domain or business, clarify the contract structure before the next negotiation round.
The expression business name is used in different ways in everyday transactions. For section 23 UGB, the Firma is decisive. Section 17 UGB describes it as the name of an entrepreneur registered in the Firmenbuch under which the entrepreneur operates and signs. It is therefore a legally defined entry, not every designation used by a business in public.
This classification creates the first contract review step. The Firmenbuch extract shows which name is registered. The draft agreement must then make clear whether the buyer acquires the business for which that name is used or merely wants the name. The description of the acquisition object must answer that question.
A trademark and a domain perform different functions. The definition of the business name does not automatically turn them into part of the Firma. Their transfer requires separate allocation and review. This remains so if the trademark, domain and business name use identical wording.
Section 23 UGB states a clear connection: the business name cannot be sold without the business for which it is used. The prohibition is therefore tied to the relationship between the registered business name and the related business. An agreement that expressly separates them requires a different legal and commercial structure.
For the practical review, the title of the agreement is not enough. Its contents matter. If the business remains with the current owner and only the wording of the business name is to pass to another buyer, the arrangement closely matches the situation that section 23 UGB is designed to prevent.
The provision answers the narrowly defined question of an empty transfer. This post does not decide the transfer of a trademark or domain and makes no statement about legacy liabilities, buyer liability or continuation of a business after a person leaves. Those subjects require separate review.
Before drafting, buyer and seller should record the business name in the Firmenbuch extract, the business as the economic acquisition object and any additional identifiers in separate lists. This prevents a common public appearance from being treated as proof that all legal objects are transferred together.
The description of the business must fit the proposed acquisition. It should not consist only of the wording of the name and should not anticipate every business asset through a vague formula. The documents must identify which business is connected with the name under section 23 UGB and how that connection appears in the agreement.
For partnerships, additional company-law issues arise when interests are acquired. The post on buying KG and OG interests covers that different acquisition structure. The link does not change the boundary of this post, which concerns the business name and business under sections 17 and 23 UGB.
These objects may work together in a public business presence. The agreement must allocate them separately.
| Object | What it concerns | Contract review question |
|---|---|---|
| Business name Business name | Name registered in the Firmenbuch under section 17 UGB | Is the name transferred together with the related business? |
| Business Business | The operational acquisition object | Which business is to pass with the name? |
| Trademark Trademark | A separate identifier with its own ownership | Is a trademark expressly and separately included? |
| Domain Domain | An internet address with its own registration and contract | Which domain and contracting party are involved? |
Section 23 UGB concerns the sale of the business name without the related business. The other objects do not transfer automatically as a result.
A clause is problematic if it names only the wording of the business name as the acquisition object and at the same time states that the business remains with the seller. That combination does not describe a joint transfer of the business name and business. It should be reorganised before signing.
A general label such as name and business presence also does not answer the question reliably. The agreement should distinguish the business name, business, trademark and domain expressly. This makes it possible to determine whether the planned acquisition respects the connection required by section 23 UGB.
A regulated business raises additional approval and control issues. The post on buying a regulated business covers those questions. They do not replace the separate assessment of an isolated transfer under section 23 UGB.
Before signing: If the draft transfers only the wording of the business name while the current owner keeps the business, the contract structure must be reviewed under section 23 UGB. A trademark or domain cannot replace the statutory allocation of the business name.
The first review should bring together the current Firmenbuch extract, the complete draft agreement and a clear description of the business. The extract confirms the registered name. The agreement must show whether and how the related business is included as an acquisition object.
Trademark and domain documents should be collected in separate entries. They should identify the relevant object, its registration or contractual allocation and whether the buyer is intended to receive it. A joint checklist is useful, but it must preserve the separate legal allocation.
Before signing, prepare a short comparison of what the buyer receives under the agreement and what remains with the seller. If that comparison shows only a business name without the related business, the empty transfer is a central unresolved contract issue.
Under section 17 UGB, the Firma is the name of an entrepreneur registered in the Firmenbuch under which the entrepreneur operates and signs. It is a legally defined business name and is not automatically the same as a trademark or domain.
Section 23 UGB provides that the business name cannot be sold without the business for which it is used. An agreement for the wording alone while the current owner keeps the business therefore requires review under the prohibition of an empty transfer.
No. The business name is the name registered under section 17 UGB. A trademark is a separate object for review. Even where both use the same wording, the agreement should allocate and transfer them separately.
No. A domain has its own registration and contractual position. If it is to pass to the buyer, the agreement should identify the domain and the required steps separately.
Compare the Firmenbuch extract, the complete draft agreement, the description of the business and separate trademark and domain documents. They should show what the buyer receives and whether the business passes together with the business name.
Partnership agreement, liability and Firmenbuch issues in an interest acquisition.
FMA, trade licences and fit-and-proper requirements in a change of control.
Classify the transfer of a business as its own transaction object.
Distinguish the basic acquisition structure and its objects.
Organise open transaction questions before the next negotiation round.
Record documents and review fields for the transaction in a structured way.
When buying a company, structure, review and contract decide. Call us directly or send an email, callback within one business day.
Address
BRANDAUER Rechtsanwälte GmbH Giselakai 51 5020 Salzburg
Phone
+43 662 6280000