WW Holding AG has announced, in light of an incapacity to pay and overindebtedness under insolvency law, that a petition to open insolvency proceedings is being prepared to be submitted to the Commercial Court in Vienna (Handelsgericht Wien).
Investors seeking advice should approach persons active in advisory professions, such as e.g. lawyers, the VKI (Verein für Konsumenteninformation) (information in German at www.vki.at) as well as the Arbeiterkammer (www.arbeiterkammer.at).
For legal reasons the FMA is unfortunately unable to provide any advice, but is able to nevertheless to provide the following information:
Neither WW Holding AG nor WIENWERT AG are subject to supervision by the FMA
Neither WW Holding AG nor WIENWERT AG hold licences issued by the FMA. According to the currently available information, both companies currently do not perform any financial services in Austria that require a licence. Both companies, namely WW Holding AG and WIENWERT AG, are therefore not supervised by the FMA. The information that is summarised and presented by us, therefore does not originate from the findings of the FMA from its ongoing supervisory activities, but instead comes from information that is available in the public domain.
For a better comprehension of the situation, we have summarised the history of WIENWERT AG and WW Holding AG:
- WW Holding AG (formerly WIENWERT AG – Commercial Register no. FN 308774f) was entered into the Commercial Register on 25.4.2008 as WIENWERT Immobilien Finanz AG. Subsequently the company has been renamed several times: on 4.6.2016 as WIENWERT AG, on 14.12.2016 as WIENWERT Holding AG and most recently on 12.05.2017 as WW Holding AG. This company issued bonds previously issued as “Wienwert”.
- The new company WIENWERT AG (Commercial Register no. FN 332378t) was registered in the Commercial Register on 31.12.2016 following its name change from SALEM Beteiligungsverwaltung sechzehnte GmbH. This company was the issuer of the most recently issued “Wienwert-Unternehmensanleihen” (Wienwert corporate bonds).
Bonds
Both entities have issued bonds. Bonds are only allowed to be publicly offered in Austria where a capital market prospectus has been published, or where an exemption from the obligation to publish a prospectus has been made use of.
In the case of WW Holding AG and WIENWERT AG, during the period between 2010 to 2017, more than 20 bonds were issued, of which the majority were issued while making use of exemptions from the obligation to publish a prospectus.
This is legally permissible, with the rules about this being contained in Article 3 para. 1 no. 9 Capital Market Act (KMG; Kapitalmarktgesetz) (to summarise: with a minimum denomination per unit of EUR 100,000) and Article 3 para. 1 no. 14 KMG (to summarise: for less than 150 persons).
Until 2017 bonds were issued by WW Holding AG, from 2017 by WIENWERT AG
Some bonds were publicly offered on the basis of three approved prospectuses. Of these three prospectuses, two prospectuses were approved by the supervisory authority in Luxembourg (CSSF; Commission de Surveillance du Secteur Financier), with only one prospectus being approved by the FMA.
- Only the prospectus of the former WIENWERT AG (now WW Holding AG) of 19.11.2013 was approved by the FMA, for an offering of a 6.5% bond with an issuance volume of EUR 5 million. This bond becomes due for payment on 11.12.2018.
- The base prospectus of WW Holding AG (previously WIENWERT AG) was authorised by the supervisory authority of Luxembourg (CSSF) in 2016 and was only notified to the FMA. On the basis of this prospectus, two bonds were issued in 2016, that were traded on Wiener Börse AG’s Third Market (Dritter Markt).
- The base prospectus of (the new) WIENWERT AG was approved by Luxembourg’s CSSF on 11.05.2017 and then only notified to the FMA; on 09.06.2017 a supplement to the prospectus was published. The most recent offering for “Wienwert-Unternehmensanleihen” was issued on the basis of this prospectus. Based on the information that is available to us, the Wienwert-Unternehmensanleihen are currently no longer being publicly offered.
The FMA is not the competent supervisory authority for the authorisation of the latest offer. The authorising, and therefore primarily competent supervisory authority, is the CSSF in Luxembourg.
Activities of the FMA in relation to “misleading advertising” in relation to WIENWERT
Advertising materials from entities that issue bonds must be in keeping with the prospectus, and are also not allowed to be misleading or inaccurate. Where advertisements give an impression that they have potential to mislead e.g. due to the extremely positive depiction of the product, or that they may lead to misunderstandings, then this may lead to an administrative penalty by the FMA.
The FMA does not have any legal possibility to prohibit the public offering of corporate bonds.
The FMA has exercised all legal means and competences available to it in full, and has issued the following penal orders:
- In 2016, the FMA issued penal orders against both members of the management board of Wienwert Immobilien Finanz Aktiengesellschaft, Wolfgang Sedelmayer and Nikos Bakirzoglu, (both on 06.04.2016) with fines respectively totalling € 9,800 for misleading advertising pursuant to Article 4 para. 3 KMG (a misleading print advertisement in the daily newspaper “Die Presse” with the keywords in German of “3-fach sicher: treuhandgesichert. prospektgeprüft. grundbücherlich eingetragen.” (“triply safe: Guaranteed by a trust. A checked prospectus. Registered in the land register.”) as well as for breaching reporting obligations in relation to the New Issue Calendar pursuant to Article 13 KMG in six cases respectively. Both penal orders are final and were published on the FMA website.
- In a penal order issued on 05.09.2017 a total fine of EUR 85,000 was imposed against Stefan Gruze as the responsible representative of WIENWERT AG at the time that the offence occurred for multiple breaches against the regulations contained in the KMG on publicity, namely for failing to refer to the prospectus and misleading advertising (Article 16 no. 3 in conjunction with Article 4 nos. 2 and 3 KMG). An appeal was lodged with the Federal Administrative Court (Bundesverwaltungsgericht) on 05.10.2017. The procedure is pending at the Federal Administrative Court (BVwG). This penal order was published on the FMA’s website.
The Role of the FMA in the Consumer Protection
In additional, the FMA has an obligation towards collective consumer protection, and therefore protects the collective interests of consumers – for example customers of a particular insurance sector, or the savers and investors communities in accordance with scope afforded in supervisory laws.
The FMA, however, is not a consumer protection organisation in its “classical” sense.
The Financial Market Authority is forbidden from intervening in a contract concluded under civil law between an entity and an individual customer. In cases of claims for damages, the Financial Market Authority is always required to direct consumers towards action under civil law. Ordinary courts of law are competent for deciding about such claims.
Classical consumer protection institutions have been established to protect the interests of individual consumers, such as the Verein für Konsumenteninformation (VKI) (www.vki.at) and the Arbeiterkammer (AK) (www.arbeiterkammer.at). The party that has suffered damages may also contact a lawyer.