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October 2025 – Increasing digitalisation, the market growth of cryptocurrencies, and the growing importance and use of AI are among the reasons that have led to an increasing demand for data centres and a growing interest in investments in this asset class in recent years.
In addition to numerous other challenges associated with the acquisition and/or development of data centres, such as, in particular—(i) the search for a suitable location, for which the most important criteria are power supply and network infrastructure, as well as zoning and building regulations; (ii) obtaining the necessary public law approvals, whereby in addition to building and operating permits, also nature and water law approvals, as well as the conclusion of an environmental impact assessment procedure (Umweltverträglichkeitsprüfung),may be required; and (iii) the operation of the data centre in the most resource-efficient manner possible and the use of waste heat—certain data centre investments also face a further regulatory hurdle, which we draw your attention to below.
According to the Austrian Investment Control Act (Investitionskontrollgesetz), certain direct investments by foreigners (i.e., natural persons who are not citizens of the EU or of an EEA country or Switzerland, or legal entities whose registered office or head office is located outside the EU, the EEA, or Switzerland) require approval from the Federal Minister for Economy, Energy and Tourism.
This notification obligation applies, among other things, to investments in companies operating in critical infrastructure sectors, including data processing and data storage, as well as investments in real estate that is of crucial importance for the use of such critical infrastructure.
Please note that greenfield investments are currently not subject to an approval requirement under the Austrian Investment Control Act, meaning that any approval requirement currently only applies to investments in existing and operational data centres. However, this could change in the future as a result of the revised EU FDI Screening Regulation, which is expected to be enacted in 2026.
Foreign direct investments are also not subject to the approval requirement if the target company (in this case, a data centre operation) is a micro-enterprise with less than ten employees and an annual turnover or annual balance sheet total of less than EUR 2 million.
A violation of the obligations under the Investment Control Act may constitute a criminal offence or an administrative offence punishable by imprisonment and/or a fine. Further, legal transactions relating to an investment subject to approval under the Investment Control Act are deemed to be concluded subject to the condition precedent of the granting of the necessary approval and are therefore void if such approval is refused.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
