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05.2020 - May

ADVANTAGE AUSTRIA TEHRAN

AUSTRIAN BUSINESS NEWS

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EDITORIAL

Dear Reader,

I hope this mail finds you, your family and friends in good health and spirits.

For all of us , the past few months have been dominated by the Covid 19 pandemic

and its effects on our lives and businesses. Unfortunately, it doesn’t look like the

pandemic will disappear soon and we will have to deal with its repercussions for a

while.

Lockdowns have forced us to work from home, stoppage of commercial flights and

the closure of many international borders have added to the existing challenges.

All this has also had an impact on the situation in Austria. Luckily, the early imposition of lockdown measures

by the government has limited the number of infections and deaths, this at a high economic price. More than

a million Austrian job holders have been forced to work short-time under the “Kurzarbeit” programme,

where the state picks up the tab for part of the salary. Public debt has jumped, and growth will clearly be

negative this year. For a small, landlocked country like Austria, which depends on exports and international

tourism for much of its income, intra-European border closures are an extra challenge. Still Austria is among

the countries which faced this crisis from a favourable position. In 2019, Austria recorded a Government

Budget surplus equal to 0.44 percent of the country's Gross Domestic Product.

The Austrian government allocated 400 million euros to help the gastronomy sector, 2.4 billion euros for the

restoration of schools and the installation of fiber optic network to provide full acces to WLAN to pupils all

over the country. Furthermore, all companies affected by closures, travel restrictions, gathering limitations

which have now liquidity shortages as well as companies which as a result of the corona crisis are facing

heavy losses and are at risk will benefit from a government grant to cover their fixed costs , this may vary

from 25% to 75% .

As the Persian saying goes, every crisis is also an opportunity. This one has certainly sped up the digitalisation

field and will bring up new, innovative and resilient methods of doing business.

Many things will have to change, but one thing will remain the same: My team and I are at your disposal for

all your business activities with regard to Austria.

Best regards,

Christoph Grabmayr

Commercial Counselor at the Austrian Embassy in Tehran

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FACTSHEET

2019 was a bumper year for the Austrian economy. Foreign trade rose to new records, with both exports and

imports reaching an all-time high. Exports amounted to 153,8 billion, imports to 157,9. The trade deficit of

4,2 billion was more than compensated by the excess balance of 10,4 billion from the exchange of services,

where exports of 67,1 billion outshone imports of 56,7 billion (all numbers are in Euro).

The other member countries of the European Union were still the most important trading partners by far,

accounting for around 70% of Austrian imports and exports. Germany alone tallies up 36% of Austria’s total

imports, and 30% of total exports, followed by Italy. The most important trading partners outside the EU

remain the US, Switzerland and China.

Trade with Iran, unfortunately but somehow predictably, diminished: Austrian exports fell from 268 million

to 130 million, Iranian Exports to Austria fell from 457 to 16 million. This is entirely due to the disappearance

of Iranian oil exports, which had almost quadrupled the year before.

In 2020 it will clearly not be possible to achieve comparable results, preliminary numbers show a reduction

in trade across the board.

Source: Statistic Austria

Source: Economist Intelligence Unit

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Source: Bonbast

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Sanctions

With the announcement by US President Trump on May 8, 2018, to exit the JCPOA, sanctions were imposed

on many Iranian industrial sectors, individuals and companies. After a transitional period (waiver of 90 and

180 days, respectively) the Iranian government and industrial sectors like the steel and petrochemical

industry came under increased pressure.

In this regard, Austrian companies only have to comply with EU and UN sanctions, but many Austrian

companies with US interests must exercise greater caution. This means that they have to pay more attention

to general conditions when doing business with Iran.

• No involvement of US persons

• No involvement of US financial system (no transactions in US dollars)

• Compliance with EU and UN sanctions (dual use, military goods, EU and UN sanctions list)

The United States' SDN listings are not legally binding for EU companies, but, as the Huawei case has shown,

the United States may extraterritorially enforce their own regulations.

Since the renewing of US sanctions, money transfers between Iran and Europe have also been made more

difficult. Furthermore, insurance companies and more and more transport companies have also withdrawn

from Iran business.

At the meeting on February 21 of this year, the “Financial Action Task Force” FATF decided to blacklist Iran

once more without restrictions. In order to give Iran the opportunity to take the necessary steps to reintegrate

into the international financial system, the consequences of the black listing have been suspended.

In any case, this is an additional challenge for doing business with Iran. Banks and supervisory authorities

are required to exercise extreme caution in all business transactions related to Iran. At the FATF meeting,

however, no mandatory implementation of measures linked to the blacklist was defined, it is within the

responsibility of each member state to determine which measures have to be inforced in order to be

compliant with the requirements.

Here, the cooperation and flexibility between all partners is extremely important in order to continue to

maintain the good economic relationships that have existed for decades.

An important aspect for the banks and companies which are still active in the Iranian market and want to

continue their cooperation is the due diligence and compliance of the Iranian partner and end customer.

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Visa and travel to Austria

The Consulate of the Austrian Embassy remains closed to the public until further notice. This also applies to

VFS, the external service provider for Schengen-Visa. The resumption of visa-related activities depends on

an agreement of the Schengen area member states of the European Union. You can find further information

on the homepage of the Austrian embassy in Tehran, https://www.bmeia.gv.at/oeb-teheran/ (German), or

https://www.bmeia.gv.at/fa/oeb-teheran/ (Farsi).

Flight possibilities To and From Vienna

Due to the pandemic, Austrian Airlines are grounded until further notice. Discussions about its future are

held between the company, its parent company Lufthansa and representatives of the Austrian government.

The company will need public support to resume its activities. There has been no decision made yet, if and

when flights to Tehran will operate again.

Actual possibilities to travel to Vienna are listed below, please bear in mind that flight possibilities are subject

to regular changes:

Iran Air offers direct flights from IKA to Milan Malpensa and Paris CDG every Friday as well as IKA to London

Heathrow on Thursdays and Sundays. Direct flight possibilities from these cities to and from Vienna are

operated by Austrian Airlines, Air France and Wizzair.

Qatar Airways offers flight possibilities to Vienna through Doha and Frankfurt and direct return flights from

Vienna to Doha. If you arrive at Munich and Frankfurt airports, you can take the train for your further journey

to Austria. Deutsche Bahn AG and ÖBB/ Austrian Railways, https://www.oebb.at/ operate their rail services,

please check their websites before your travel.

Vienna International Airport: The Vienna airport is partially open for passenger and cargo flights. All Check-

ins for passenger flights are done at Terminal 3, in the whole area of the terminal, it is mandatory to wear a

mask. Related information regarding the flight schedules, travel restrictions, Covid 19 tests etc. may be found

at https://www.viennaairport.com/aktuelles

CORONAVIRUS PCR TESTS NOW POSSIBLE AT VIENNA AIRPORT

Vienna Airport now offers passengers the possibility to undergo molecular-biological COVID-19 testing (PCR

test) at the airport. The test findings are available within a period of about three to six hours.

Please note that you have the possibility to make a Covid 19 test in Iran 4 days before your departure. Tests

should be done at authorized laboratories in due form and be certified by a physician.

Arriving passengers who do not have a health certificate can only be tested if they have a residence in Austria

and a valid residence permit. All other arriving passengers who do not have a health certificate will be

immediately taken to quarantine by the authorities. They must arrange for themselves to be tested by a

laboratory at the quarantine location, which may involve longer waiting times.

WHO CAN TAKE ADVANTAGE OF THE PCR TEST OFFERING?

The test offering is for all passengers, with a residence in Austria and a valid residence permit, arriving at

or departing from Vienna Airport. It is absolutely necessary to make an appointment in advance in order to

avoid close contact with other customers when undergoing a COVID-19

test https://www.viennaairport.com/pcrtest

All this information is subject to frequent changes, and might be outdated by the time you want to travel.

Please check with airlines, airports and the consulates of destination and transit countries.

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NEWS FROM AUSTRIA

COVID-19: Austria is starting up its economic motor

Austria’s domestic economy has been hit by the Coronavirus

crisis as well but the country is set to regain its old export

prowess, thanks to its economic resilience. The global economic situation is weighing heavily on domestic budgets, economic activity, stock markets

and manufacturing. The spread of the Coronavirus has of course imposed limits on commercial activity in

Austria, too. International trading relationships have suffered and the country’s GDP growth has been

hampered, although not as badly as in other economies.

As a result of the Coronavirus crisis, the EU Commission has thus drastically lowered projected growth for

Austria and other EU states; according to these projected figures, Austria’s GDP is set to drop by 5.5% this

year before bouncing back and expanding by 5% in 2021. A record drop of 7.7% is even anticipated for the

Eurozone as a whole.

Austria’s more positive position is due not only to the many years of success enjoyed by its economy but

also to the way it has overcome the Coronavirus pandemic by means of a drastic lockdown. As thoughts

now turn to a step-by-step rebooting of the economy, the government is implementing aid measures for

companies and employment – as firms need certainty in their planning and financing along with liquidity.

With an aid package in excess of EUR 40 billion, Austria leads the international field, with subsidies,

deferment of payments, liabilities and guarantees, interim aid, tax breaks and furloughs just some of the

elements to be emphasised. Economic measures are also set to boost future commercial growth. The

overall plan is to establish conditions for companies that will enable them to make substantial profits

under their own steam once more.

As an open market economy, Austria is involved in multivalent and differentiated foreign trade, and plays a

pioneering international role as both a tourist destination and economic location. Its export companies

boast the highest quality and supply their finished good and third-party products to more than 200

countries. With an export ratio of over 55% of GDP, foreign sales are the source of Austria’s prosperity and

international trading relationships its lifeblood. This is why ADVANTAGE AUSTRIA is ready with advice and

help for all stakeholders and business partners, even – and especially – in such challenging times.

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Austria is opening up – and “red, white and red” is making a

comeback

The Austrian federal government has added additional easing to

its exit schedule for a step-by-step relaxation of the shutdown

imposed due to the Corona crisis.

With Austria having steered a successful course through the Corona crisis so far, thanks to rigorous

protective measures, the country is now slowly rebooting its economy; a certain degree of normality is now

set to follow the social, communal and medical shutdown.

The path back to normality will nonetheless be long and difficult, and very different for the individual

sectors of the economy. Being allowed to open your doors does not automatically mean that everything will

be just the same as it was before. Overall, requirements must be arranged such that companies can

resume business and make a profit under their own steam and return to their usual performance levels

and export efficiency, thereby breathing new life into Austria as an economic centre and tourist destination.

The Austrian government has been announcing its graduated re-opening plan in stages: smaller business

received permission to open mid-April, with larger companies, shopping centres and many service

providers getting the nod from the beginning of May; restaurants will be opening their doors from 15 May

and hotels and open-air swimming pools will follow suit from the end of the month – with restrictions on

visitors/guests, social distancing and face-masks.

Museums and zoos will also be allowed to open, theatres can resume rehearsals and people will be able to

attend church services. Professional football clubs and athletes are training again and the schools will

open in stages during May. Public events with a maximum of ten participants are also permitted. Another

new development is that the restrictions on leaving the home that have been in place since mid-March are

coming to a close.

Certain things will remain in place however: people in public places have to maintain a minimum distance

of one metre from anybody else not living in the same household, and a mask must be worn when shopping

or travelling by public transport.

Austria implements online company creation

The most popular company structure in Austria, the “GmbH” (limited liability company), can now be created

online, without the requirement of physical presence of the parties. This applies also to non-Austrian

company founders and shareholders.

All the necessary steps, such as the articles of association and the nomination of a managing director can

now be implemented and signed online. This also holds for the payment of company capital and the listing

in the commercial register.

All these acts require the participation of a notary public, who will implement the necessary measures to

ensure the identity of the participants and the necessary security of the proceedings. In particular for

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foreign investors, and despite the effort necessary to ensure these elements, the new regulations will

make the establishment of a limited liability company much faster and cheaper.

For further information, please see: https://investinaustria.at/en/blog/2020/05/company-foundation-

online.php

The Austrian Startup Scene There is no common international definition for a startup. However, most definitions depend on how

innovative the company is, in terms of technology, products, services and business models as well as its

growth potential. According to the European Startup Monitor, startups are defined as new ventures that meet

the following criteria: Startups are younger than 10 years, Startups have innovative technologies and/or

business models, Startups aim to grow their team and revenue. Three important support structures help

startups establish themselves and grow in the market: Company builders, incubators and accelerators. More

than 70% of Austrian startups have succesfully developed a prototype or a product. This proves the efficiency

of the method implemented by the incubators and accelerators. You can find such examples here.

Austria has also several highly developed science and technology parks promoting startups. One of their

main activity is to support the startups with their network and provide them a platform to establish contacts

and start communicating with key players in their respective fields. An excellent example of this is the High

Tech Incubator Science Park of Graz.

The most important key to success for a startup company is to find an investor at an early-stage. These

investors are often called “business angels”. In this respect, Austria has founded the “Austrian Angel

Investors Association”, the website provides useful information about investors, projects and startup

companies.

Development rates of startups in Austria

Data: Austrian Startup Monitor

Graphics: H. Ketabian

Startup Growth Stage

14.2%

Seed Phase 44.3%

Startup Phase

33.6%

Growth Phase1.1%

Later Stage

2.2%

Steady Stage

4.6%

Others

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Fields of activities of Austrian startups

Data: Austrian Startup Monitor

Graphics: H. Ketabian

About one third of Austrian startups is active in the software industry. This matches well with the Iranian

numbers. Iranian programmers and IT-companies are well known for their high skills and are attractive

partners for Austrian companies.

As an example of what an Austrian accelerator has to offer, please check the website of Up To Eleven

The information contained in this article is sourced from the Austrian Startup Monitor

(https://austrianstartupmonitor.at/#home) a joint inititiative by AIT Austrian Institute of Technology, the

startup interest association AustrianStartups und the Entrepreneurship Center of the Vienna University of

Economics and Business.

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.ABA – Invest in Austria is throwing open its doors for ABA’s

Virtual Open Day on 28.05.2020, with presentations and

individual consultations about Austria as a business location.

Every crisis is also an opportunity to consider new options and

these include new avenues for customer communications, new

partners and new markets.

Under this motto the Austrian Business Agency will be introducing Austria as a business location on 28 May

and providing foreign investors with bespoke advice in individual virtual consultations.

The online event will provide a good overview of general business conditions in Austria and set out the

advantages overseas companies hoping to expand into the country can expect. In addition to the

presentations on business, research, life sciences and start-up location, prospective investors will have an

opportunity to sign up for individual virtual meetings with in-house and external experts to hear answers to

specific questions.

There is no charge for participation.

The latest information and registration options are available from the event website.

VIENNA: Greenest city in the world

© Austrian Tourist Board / Popp-Hackner

Vienna placed first in the latest ranking of the “World’s Greenest Cities”.

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A total of 50 cities across the globe were examined within the context of a study carried out by the

international management consulting company Resonance Consultancy. A large number of green areas, an

outstanding public transportation network, green energy and lively markets have turned the former

imperial capital into the greenest city anywhere. The analysts praised the diversity of green areas, ranging

from the English landscaped gardens such as the City Park to the national park located directly on the

city's borders. Vienna boasts additional advantages, for example the fact that close to half of the people in

Vienna have an annual pass for public transportation. Moreover, Vienna derives 30 percent of its energy

from renewable energy sources. This is complemented by 135 "farmer's markets" i.e. markets selling

locally produced food such as fruit, vegetables, meat and fish.

https://investinaustria.at/en/news/2020/05/vienna-as-the-greenest-city.php

Vienna named most liveable city for the tenth time!

Millions of enthusiastic visitors to Vienna know what has now been confirmed for the tenth time in a row by

Mercer's international comparative study: Vienna is and remains the best.

Each year, the international consulting firm Mercer carries out a study to assess the quality of life in 231

cities around the world. The results of the study in 2019 once again gave Vienna top marks and made the

Austrian federal capital the most livable city in the world for the tenth time in a row.

"Vienna scores with its very good medical care and an extremely broad range of cultural and leisure

activities".

The survey compares the political, social and economic climate, medical care, education, and

infrastructure conditions such as the well-developed public transportation network, power and water

supply.

It also takes into consideration recreational offers such as restaurants, theaters, cinemas, sports facilities,

the availability and high quality of all kinds of consumer goods, as well as nature and environmental

conditions.

For more information, visit www.mercer.com

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PUBLICATIONS

Austrian experts fighting COVID-19

Companies from Austria have been on the spot in providing

bespoke, innovative solutions to combat the Coronavirus crisis.

The Coronavirus crisis is ubiquitous and still the only topic of conversation; all our lives have been turned

upside down. That Austria has navigated a better path through the crisis than other countries is due not

only to having countered the Coronavirus pandemic with a drastic lockdown but also to the many years of

success enjoyed by its companies.

We would like to introduce some companies from Austria whose products are currently of particular

relevance, whether in the medical and technical field, in pharmaceutical treatments and testing, or using

specific solutions in IT for both medical and technical manufacturing purposes.

The following pages will give you a sense of the innovative products and services available from Austrian

companies of particular relevance in these times of COVID-19. You too can benefit from great know-how

that is internationally ground-breaking: Austrian Experts Fighting Covid-19 [pdf].

FRESH VIEW MAGAZINE

Austrian Companies at a glance

Please find an overview on Austrian companies from all sectors of industry and services in the Fresh View

Publications of the Austrian Chamber of Commerce.

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UPCOMING EVENTS 2020-2021

Date / Place Event

15.-18.09.2020

Tehran

Austrian Online Economic Mission

14.10.2020

Vienna

Market place Austria for food and beverages 2020

Austrian exporters in the food industry

18.-20.10.2020

Tehran

General humanitarian products | Economic Mission

Non-sanctioned products, food, agriculture, health

19.-20.11.2020

Vienna

International Mobility Day | B2B Platform

Innovation, Trends & Export opportunities in the mobility sector

23.11.2020

Vienna

Iran Forum

B2B meetings with Iranian companies

23.-25.11.2020

Vienna

Engineering & Startups | B2B Platform

Engineering, Consulting, Outsourcing, IT, Startups

29.11. – 1.12.2020

Tehran

Digital Iran

Austrian delegation to Iran, solutions for smart cities and startups

24.-27.01.2021

Tehran

Rail Transport & Smart Transport-Rail Expo 2021

Austrian delegation to Iran, Infrastructure & Mobility

23.03.2021

Vienna

Future of Building 2021

Business delegation to Austria, Construction congress, trade fair and

B2B cooperation exchange

27.-30.04.2021

Berlin

Innotrans Berlin | Workshop

InnoTrans / Status of new construction and modernization projects

Should you be interested in attending any of the mentioned events, please send us an Email.

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Looking for prestigious conference facilities in Tehran?

The commercial Section of Austrian embassy is the perfect location for Austrian companies and their

representatives in Iran. We can organize:

- Workshops

- Seminars

- Product Presentations

- Evening receptions for your clients and partners

- Marketing Events

- Meetings etc.

We are able to offer you the whole range from small meetings up to garden receptions for 150 guests.

The team of the Austrian Trade Commission looks forward to assist you with the organization of your events

according to your needs and requirements. For further details please contact:

Austrian Embassy - Commercial Section

Nelson-Mandela Expressway, Golgasht Street No. 20

Tehran - Iran

T +98 21 22 05 18 20

F +98 21 22 05 18 16

teheran@advantageaustria.org

www.advantageaustria.org/ir

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CONTACT & SERVICE

ADVANTAGE AUSTRIA Tehran

Austrian Embassy - Commercial Section

African Expressway, Golgash Street No. 20

Tehran, Iran

T +98 21 22 05 18 20

F +98 21 220 518 16

E teheran@advantageaustria.org

W http://www.advantageaustria.org/ir

ADVANTAGE AUSTRIA, with its network of foreign

trade offices, is the Foreign Trade Promotion

Organisation of the Austrian economy. Under the

auspices of the Austrian Federal Economic Chamber,

ADVANTAGE AUSTRIA is Austria's largest service

provider and driver of all international economic

activities. ADVANTAGE AUSTRIA acts as an official

lobby, representing the interests of its Austrian

members both at home and abroad.