Alternate arms procurement from a civil law design view - rental and leasing models for the German and Austrian Armed Forces

Fundamentals, typical objections and optimized possibilities of design as well as selected fiscal aspects

 

Karl-Heinz Gimmler

 

Since the end of the Cold War, and despite international crises, the arms and defence expenditure of almost all NATO and EU states have tended to decrease. Germany gradually tries to obtain more than 1,17% of its gross national product, which is in fact still far from the NATO demand of 2%. Germany, however, like most of the NATO and EU states, attunes to having unpretentiously to “boot” its own defence because of the election of the new US president Donald Trump and his unmistakable announcements in the course of his election campaign. In Austria, the turning point in the defence budget, long desired and scrambled for, appeared in 2016. One can assume that the “bottom” has been stridden - but there is still a long way for the Austrian Armed Forces to be suitably equipped. The object of the following analysis is to basically compare alternate possibilities of procurement with „classic” arms procurement on a purchasing law basis, and thus to point out especially the civil law possibilities of design. Practical alternate civil law ways are to be demonstrated in order to achieve adequate defence armament despite tight national defence budgets. Only civil law designs according to German and Austrian law are mentioned. As far as general law of tenantry and specific selected risk constellations are concerned, only reliable statements are made for Germany and Austria. Concerning certain special constellations, only the German legal position can be presented obligingly, as the Austrian legal position must still be assessed closer. In the following, without any closer explanations, the paragraphs of the German Civil Law Code are denoted with „BGB“, those of the Austrian General Civil Law Code with „ABGB“. Insofar as other German or Austrian law is referred to, this is especially indicated. An excursion deals with specific turnover tax arrangements, which - without closer examination - presumably may be applicable also for Austria, due to European legal guidelines, namely the “Guideline on the Common Value-Added Tax System” which has been valid for all EU states. Public law, constitutional law or award law aspects are not dealt with here. In summary one can state: From a civil law as well as a tax law point of view, rental and leasing based armaments procurement represents a mentionable option for European states. There are practicably no disadvantages discernible.