An Austrian court has made a significant ruling regarding the use of Islamic Sharia law in private arbitration. The Vienna Regional Court for Civil Matters confirmed that such arbitration is permissible under Austrian law, provided that both parties agree and that it does not conflict with fundamental public policy. This decision arises from a financial dispute between two men who had entered into a contract stipulating arbitration based on Islamic principles.
The arbitration tribunal ruled in favor of one party, ordering the other to pay €320,000. The losing party appealed to the Vienna court, arguing that the application of Sharia was inconsistent due to varying interpretations among scholars and conflicts with Austrian laws. However, the court rejected this claim, noting that while it could not ascertain the specific Islamic rules applied, the outcome remained within Austrian legal boundaries.
“In principle, the law allows for the application of foreign legal provisions in civil matters,” the court asserted, highlighting that this includes Sharia in cases involving property disputes. It explicitly stated that such applications are limited to civil matters like debts and contracts, excluding areas like criminal or family law.
The ruling has sparked backlash, especially from politicians within the right-wing Freedom Party of Austria (FPÖ). MP Michael Schilchegger expressed concern, stating that the decision could pave the way for a rise in political Islam and facilitate “parallel societies.” The Turkish Cultural Community in Austria (TKG) has also voiced its discontent, with General Secretary Melissa Günes warning that this could lead to Sharia influencing broader economic regulations. She pointed to a 2003 ruling by the European Court of Human Rights, which deemed Sharia law incompatible with democratic values.
In reaction to the criticism, the Austrian People’s Party (ÖVP) has pledged to take measures to address the concerns stemming from the ruling. Secretary General Nico Marchetti confirmed that steps would be forthcoming in light of the Sharia-based arbitration award.
Austrian arbitration law permits parties to choose governing rules, including international laws, as long as they align with public order. Such provisions are found in several European nations, allowing private arbitration tribunals to resolve disputes outside of state courts. Nevertheless, this case amplifies ongoing debates about the reach and limits of such agreements amidst growing multicultural dynamics in society.
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