General Terms and Conditions of a Credit Institution (Part 4)

Apr 23, 2026 Benn-Ibler Rechtsanwälte

On April 2, 2026, the USANCEN newsletter published the first section of an Austrian Supreme Court (Oberster Gerichtshof, hereinafter OGH) ruling concerning the applicability of certain clauses to professional practice. This week, USANCEN will examine the remaining provisions.

Clause 4: 'Reminder fees

*Reminder notice: EUR 36.50

*Formal notice: EUR 36.50

*Notice of demand: EUR 36.50

These reminder fees will only be charged if the customer is in default through their own fault and the outstanding amount is at least EUR 100.’

The court of first instance deemed the clause to be non-transparent. The court of appeal concluded that, even under the most customer-unfriendly interpretation, it was possible for EUR 109.50 in reminder fees to be charged for a debt of EUR 100, despite these fees being neither necessary nor appropriate.

The OGH stated that a clause contravenes Section 1333(2) of the Austrian General Civil Code (Allgemeines bürgerliches Gesetzbuch, hereinafter ABGB) if it does not restrict itself to necessary and appropriate expenses, nor take into account the reasonable proportion between costs and the debt being pursued.

Under Section 14(3) of the Austrian Consumer Credit Act (Verbraucherkreditgesetz, VKrG) and the underlying contractual provisions, a reminder threatening the loss of the deadline and setting a grace period of at least two weeks is a prerequisite for exercising the loss of the deadline in the event of qualified default.

Nevertheless, this clause is distinct in that it stipulates three separate letters, each imposing a charge of EUR 36.50 on the defendant. It fails to indicate that, according to Section 1333(2) of the ABGB, only reasonable debt collection expenses are eligible for reimbursement. As such, the clause diverges from Section 1333(2) of the ABGB without an objective rationale, rendering it invalid.

Clause 6:

‘Discharge receipt: 80% of the certification costs (min. EUR 51.00)’

The court of first instance determined that the clause lacked transparency, preventing consumers from comprehending the associated costs. This finding was affirmed by the court of appeal. Furthermore, the contractual provision was grossly disadvantageous as it deviated from the law of contract without objective justification.

The OGH upheld these decisions.

Pursuant to applicable law, responsibility for the costs associated with issuing discharge receipts lies with the creditor. In the absence of an objective rationale to depart from this legal standard, the clause was found to violate Section 879(3) of the ABGB and is consequently deemed invalid.

OGH 7 Ob 111/25m, 25 February 2026