Buying a business unit from the estate: information before an offer

Under section 2 IO, the legal effects of opening begin at the start of the day following public notification of the insolvency edict. A buyer must therefore not treat a crisis, petition or press release as proof that proceedings have already been opened.

For a debtor entered in the company register, section 77a IO requires entries including the opening, type of proceedings, any debtor-in-possession arrangement and the appointment of the insolvency administrator. The offer review should read the insolvency edict together with the current company register status.

The acquisition from insolvency topic hub places this review path in the wider insolvency portal.

On opening, the debtor’s property that is subject to enforcement becomes part of the insolvency estate under section 2 IO. This does not mean that every machine, inventory item or software product at the premises belongs to the estate. Ownership, leases, retention of title, licences and other rights of use require an asset-by-asset review.

Section 11 IO generally leaves security rights and separation rights concerning property outside the estate unaffected. An acquisition from the estate is therefore not automatically free of encumbrances. The separation rights and retention of title hub explains which ownership and third-party positions need separate records.

Legal acts of the debtor after opening that concern the estate are ineffective against insolvency creditors under section 3 IO. The insolvency court appoints an administrator on opening under section 80 IO.

The administrator’s authority towards third parties generally follows from section 83 IO. Published restrictions, debtor-in-possession arrangements and the special approval cases in section 117 IO still require a specific review. It is therefore inaccurate both to say that the former owner can never be a contracting party and to assume that the former owner can continue to dispose of estate property alone.

Under section 114a IO, the business generally continues until the reporting hearing unless continuation would obviously increase the creditors’ shortfall. During continuation, section 114b IO permits a sale only as a whole and only where it is clearly in the common interest of creditors.

A timely and admissible restructuring plan application can postpone realisation under section 114c IO. A business unit is not immediately available merely because an interested party can submit a quick offer.

The approval chain in section 116 IO and section 117 IO must be assessed for the actual object of sale. Section 117 covers, among other transactions, the sale of the business, all movable fixed and current assets or an operationally necessary part and requires approval by the creditors’ committee and insolvency court.

The intended sale must be published. Before approval, the statute generally requires 14 days to pass, or at least eight days where there is a substantial loss in value. These statutory periods are not a universal offer deadline. Section 118 IO gives the debtor a right to comment. A court sale of estate assets takes place under section 119 IO only on the administrator’s application and by order of the insolvency court.

The offer should not identify the business unit only by name. It needs a clear perimeter, asset list, known third-party rights, conditions for approvals and contract transfers, and a documented handover date. Employees, key contracts, licences and permits must not be treated as passing automatically.

The business unit acquisition checklist helps organise procedural status, acquisition perimeter, data room and handover before an offer.

Legal position and retrieval date: 11 July 2026. This article uses the consolidated Austrian Insolvency Code, in particular sections 2, 3, 11, 77a, 80, 83, 114a to 114c and 116 to 119 IO.

This is general information. Whether a specific asset belongs to the estate, who may sell it and which approval is required depends on the individual proceedings and documents.