Michaela Witzel LL.M.

Legal challenges for US-based IT providers entering DACH market


US IT providers interested in starting a business or investing in European countries are generally attracted by the prospect of expanding into the stable or even prospering markets of Germany (D), Austria (A) and Switzerland (CH), together referred to as DACH market. Despite the financial crises since 2008 the economies of the German-speaking market still have a good reputation with respect to its economy and provide many opportunities for new entrepreneurs. Insurances and banks, the automotive and semiconductor industry, telecommunications and the various public authorities in Germany, Austria and Switzerland are interesting targets for IT providers offering software solutions and IT-related services. If a company established in the US market has success in the German-speaking market the doors can be even opened to other European markets which offer new customers and additional business opportunities. However, US IT providers also have serious concerns about the different legal systems. Especially, German law has a strong reputation of providing substantial obstacles for the use of contractual terms which are not compliant with the provisions of the German civil law code. Nevertheless, the economic needs and challenges will force more and more US IT providers to think about expanding of their business to the markets of Germany, Austria and Switzerland. Therefore, they will also have to face the differences within the legal systems.

Computer Law Review International (CRi)
Issue 1, 15 February 2012, 19

CR International (external Link)