On December 23 2010, the new E-Money Act 2010 was issued. The Act implements the amended regulatory framework of Directive 2009/110/EC. The Act will enter into force on April 30 2011; however, transitional provisions are in place for existing e-money institutions.
The main goal of the Act was to mirror the Directive as closely as possible. This should bring a contemporary legal basis for electronic money in Austria. It was recognised that, in fact, no specialised e-money institutions have come into existence. Any enhancement in addition to the maximum harmonisation approach by the Directive was omitted.
Of particular interest should be the new definition of electronic money. Pursuant to the Directive and now the Act, the concept of electronic money should be technically neutral. Emphasis has been laid on the fact that it should now be irrelevant for the qualification of a payment system as electronic money whether the value is stored on a data device within the control of the user or on a storage device with the e-money issuer. Under the current regime, only the former would qualify as e-money, therefore any systems requiring a payment account or such like were not treated as e-money.
The main issue from a regulatory perspective is that the issuance of electronic money requires a licence pursuant to the Austrian Banking Act (para 1, item 20). In the future, an electronic money institution requires a specific licence from the Financial Market Authority, with the procedure largely following the Austrian Payment Services Act. It is also clarified that electronic money institutions can provide affiliated services such as payment services.
It remains to be seen whether the new Act will bring electronic money in Austria to life.