Changes for airbnb, willhaben and other platforms: publication of consultation draft of the Austrian Digital Platform Reporting Requirement Act (DPMG), also known as “DAC 7”

The EU’s DAC 7 Directive, which was published at the start of 2021, envisages an annual reporting requirement for digital platforms, whether they are resident within or outside the EU, as well as provisions on the automatic exchange of information (see Newsletter of 11 August 2021). The goal is to use automatic exchange of information to create transparency about the services supplied via platforms, ensure proper taxation, and increase honesty in tax matters. The consultation draft of the Austrian implementing legislation (Digitale Plattformen-Meldepflichtgesetz, or DPMG) was published on 17 May 2022.

Main points of the consultation draft

Scope

Like the Directive, the DPMG envisages a reporting requirement for operators of digital platforms, provided that the platform is accessible to users and enables sellers to carry out activities directly or indirectly for these users. The DPMG extends the definition of relevant activity in the area of immovable property not only to the rental (Vermietung) of immovable property, but also to the usufructuary lease (Verpachtung) of immovable property. Accordingly, the following activities shall be deemed relevant:

• • • the rental and usufructuary lease of immovable property
    • the provision of personal services
    • the sale of goods
    • the rental of any mode of transport.

The relevant activity must be provided against payment to trigger the reporting requirement. Furthermore, platform operators will require a territorial point of connection to Austria (even if only through the facilitation of relevant activities in Austria).

Due diligence and reporting requirements for platform operators

Every platform operator carrying out reporting is required to identify the reportable sellers on an annual basis by the end of the calendar year in question, to collect the reportable data, and to verify the reliability of the information provided. The information provided to the platform operator in this way must be subject to regular verification (at the latest every 36 months).

For the purpose of observing due diligence obligations, a reporting platform operator may use the services of a third-party provider or an additional platform operator. The responsibility for the fulfilment of the due diligence obligations shall remain with the reporting platform operator in such a case.

The reportable information must be submitted electronically by the relevant platform operator by 31 January of the subsequent year. Due to these short deadlines, platform operators will need to have good processes in place to be able to fulfil these due diligence and reporting requirements.

The platform operator is, in addition, required to inform all sellers about the existence of the reporting requirement in abstract form (e.g. via the privacy statement of the platform) before submission of the first report. Before every report, each seller concerned must be notified of the specific information to be reported.

The information transferred must be stored for 10 years and shall be subject to automatic exchange of information.

Penalties

The consultation draft envisages substantial penalties for those subject to reporting requirements in the event of a breach of the obligations set out in the DPMG.

The following penalties are envisaged for a breach of the due diligence obligation, which does not lead to a breach of the reporting requirements:

• • • up to EUR 20,000 for intent, and
    • up to EUR 10,000 for gross negligence.

A breach of the reporting requirement (non-reporting, late reporting, incomplete reporting, reporting incorrect data) may lead to the following penalties:

• • • up to EUR 200,000 for intent, and
    • up to EUR 100,000 for gross negligence.

In accordance with the current consultation draft, the possibility of submitting a voluntary disclosure to avoid a penalty and correct any errors will be excluded. In our view, this is inconsistent and may lead to undesired effects in practice. It remains to be seen whether legislators will amend the draft legislation.

Outlook

The DPMG is planned to enter into force on 1 January 2023. The initial DAC 7 reporting deadline will therefore be 31 January 2024. This deadline will apply not only to platform operators resident within the EU, but also to those outside the EU.

Platform operators will therefore need to inform themselves about the due diligence and reporting requirements. In any case, we recommend taking the following significant steps in good time:

• • • evaluate whether a reportable digital platform exists within the meaning of the DPMG
    • review the current supplier structure
    • analyse the existing systems and processes, and check the applicability and/or required adjustments for DPMG purposes
    • set up the required forms for documentation of the relevant seller data

We would be glad to support you with these steps and will keep you updated about further developments. Please see our PwC DAC 7 site for further details and contact information.

Authors: Sophie Schönhart / Verena Pöchlinger