Who may be held liable for bribery? Only individuals, or also corporate entities?
Bribery & Corruption (2nd edition)
On a criminal level, the bribery acts of an employee of a company could be deemed as either an individual crime, or a unit crime, depending on various considerations including the company’s involvement in the bribery act (such as whether it is the company’s decision to conduct the bribery), the possession of the illegal gains, and whether the bribes are offered in the name of the company or the individual employee. If the charge is raised against the individual employee, then the company would not be held accountable for the crime. However, if the charge is against the company as a unit crime, not only would the company be punished by a monetary penalty, but also the responsible persons (eg, the legal representative, and other persons in charge) could be put into criminal detention or imprisonment.
The administrative enforcement differs as there is a default mechanism in place, that the acts of bribery committed by the employee of the company shall be deemed as the conducts of the company, unless it has evidence to prove that such acts of the employee are irrelevant to seeking for transaction opportunities, or competitive advantages for the employer. Only the company would be imposed with administrative liabilities, including a fine ranging from RMB 100,000 to 3,000,000, confiscation of illegal gains, and revocation of the business license under serious circumstances. No individual liabilities are specified under the Anti-Unfair Competition Law.
Corporate criminal liability is a general principle provided for by the French criminal code. Therefore, both individuals and legal entities may be held liable for bribery offences, notably as accomplices (see 6.).
The German Criminal Code only holds individuals criminally liable for bribery offences. It does not provide for the criminal responsibility of a corporate entity. Nonetheless, the Administrative Offences Act allows fining a corporate entity for being legally responsible for bribery offences committed on behalf of the entity. For almost 20 years there have been discussions regarding the implementation of a corporate criminal law in Germany. For example, in 2013 the minister of justice of the State of North-Rhine Westphalia presented a bill that was not introduced in the Bundesrat. Most recently, German legal practitioners and professors published the so-called “Kölner Entwurf eines Verbandssanktiongesetzes” proposing legislation of a corporate criminal law. According to their coalition agreement, the present German government is considering implementing a corporate criminal law. Although there are many debates, an official legislation draft has not been published yet.
Liability as a general term may be refer to individuals and entities alike. Liability maybe criminal or civil liability.
Only individuals may be held criminally liable. Under Greek Law, legal entities may not be the subject of criminal proceedings, they can’t be prosecuted or criminally convicted. Entities may be included in a criminal trial not as defendants but as third parties liable for damages. In view of the fact that Greece has undertaken obligations to comply with the international conventions and other instruments for combating corruption, there are provisions for liability of entities within the context of criminal proceedings, which take the form of fines and/or administrative penalties. This liability (connected to the criminal proceedings) is independent from other sanctions (civil or administrative).
Individuals and entities may be held liable in the course of civil proceedings. Individuals and entities may also be held liable in the course of independent proceedings conducted by other Regulatory Bodies (e.g. the Capital Market Commission, the Competition Commission, the Central Bank of Greece etc.)
The 2018 Act applies both to individuals and corporate bodies resident in Ireland.
Under Section 18(1) of the Act, a body corporate may be guilty of an offence if an offence under the Act is committed by any of the following individuals with the intention of obtaining or retaining either business for the body corporate, or an advantage in the conduct of business for the body corporate:
- a director, manager, secretary or other officer of the body corporate;
- a person purporting to act in that capacity;
- a shadow director within the meaning of the Companies Act 2014; or
- an employee, agent or subsidiary of the body corporate.
The Act also has an extraterritorial element.
A person or corporate body can be prosecuted for an offence under the Act if any of the acts alleged to constitute the offence are committed in Ireland (or on an Irish ship or an Irish registered aircraft), even if the other acts constituting the offence were committed outside Ireland. The Act also provides that, in certain circumstances, where a person does an act in a place outside Ireland that, if done in Ireland, would, constitute an offence under the Act, they shall be guilty of an offence.
According to articles 25 and 25 ter of Legislative Decree no. 231, dated 8th June 2001, also the corporate entities might be held responsible for bribery (public or private) crimes committed in their interest or to their advantage by directors, executives and their subordinates, agents and other individuals acting on behalf of the legal entities. In order to prevent the commission of said crimes (as well as of the other ones provided for by the said Legislative Decree), and in order to be entitled to seek for an exemption from liability, a company is required to adopt and put in place the above-mentioned compliance programs.
Both individuals and corporate entities can be held liable for bribery. The criminal liability of private legal entities and public legal entities has been introduced by the Act of 4 May 1999 and the Act of 11 July 2018.
As a general rule, only a natural person is criminally liable under Japanese law. A judicial person may be held criminally liable only when there are specific provisions for punishment prescribed in the form of a dual liability (ryobatsu-kitei). A dual liability provision makes judicial persons, including corporate entities, punishable together with the natural person who actually committed the offence, unless the judicial persons prove that they were not negligent in appointing or supervising that natural person. Article 22 of the UCPA includes a dual liability provision under which a corporate entity may be prosecuted for violations of Article 18 of the UCPA Act, i.e., bribery of foreign public officials.
Both individuals and private and public entities may be held liable for bribery.
Both individuals and corporate entities may be held liable for bribery of a foreign official. A corporate entity may be liable ‘when its directors, officers, employees, or agents, acting within the scope of their employment, commit FCPA violations intended, at least in part, to benefit the company’. DOJ and SEC, A Resource Guide to the US Foreign Corrupt Practices Act at 27 [2012, updated 2015].
In recent years, US government authorities have emphasised enforcement against individuals. In 2015, the DOJ announced that investigations and prosecutions would prioritise identifying and pursuing ‘culpable individuals at all levels in corporate cases’. Sally Quillian Yates, DOJ, Individual Accountability for Corporate Wrongdoing [9 Sept 2015]. Among other things, the DOJ required that corporate entities report ‘all relevant facts relating to individuals responsible for the misconduct’ in order to receive cooperation credit. Id. The DOJ’s FCPA Corporate Enforcement Policy announced in November 2017 similarly focuses on individuals. The Policy reiterates that full cooperation from a corporate entity includes disclosure of ‘all facts related to involvement in the criminal activity by the company’s officers, employees, or agents’. Regarding ‘timely and appropriate remediation’—which is also required for full cooperation credit—the Policy requires corporate entities to appropriately discipline employees who were responsible for the misconduct. The SEC has similarly stated that individual liability is a fundamental aspect of FCPA enforcement.
Pursuant to article 24 of the LGRA, both individuals and corporate entities may be held liable for bribery and other administrative offences, with the applicable penalties and sanctions described in answer to question 5 above.
Pursuant to Article 11 Bis of the CPF and 421 of the National Code on Criminal Procedures (“CNPP”), both individuals and corporate entities may be held criminally liable for performing acts of corruption, including bribery and, therefore, punished for offences committed on their behalf, for their benefit or through the means they provide.
Both individuals and corporate entities may be held liable for bribery as detailed in Question 1.
Both individuals and corporate entities can be liable for bribery. A ‘person’ under the Crimes Act includes both incorporated and unincorporated bodies of persons. It has to be expected that where very senior levels of management or directors are involved in bribery, a company might also be charged. Recent reforms have also clarified that where an employee commits and offence under the foreign public official provisions, his corporate employer can be liable if the offence fell within the employee’s scope of authority, the employer benefitted, and the employer did not take reasonable steps to prevent the offence.
Any natural or legal person, including individuals and corporate entities, may be held liable for bribery.
While the criminal liability of the legal entities has been regulated since 2006, the jurisprudence and legal doctrine in this matter are not yet unitary. In order to establish whether a legal entity may be held liable for bribery, several distinctions should be made, as follows.
Firstly, the Criminal Code establishes that not all legal entities may be held criminally liable. Thus, public institutions shall not be held criminally liable for offenses committed in the performance of activities that cannot be the object of the private domain.
Secondly, in the matter of offences regarding taking a bribe, the predominant thesis states that it is very difficult to hold the legal entities liable for passive bribery, considering the fact that they are neither a public official, nor a private individual.
Finally, in the matter of active bribery, the predominant thesis states that legal entities may be held liable for giving a bribe, and, in practice, there are several conviction decisions regarding legal entities.
Both individuals and corporate entities may be held liable for bribery. The primary bribery offences under sections 5 and 6 of the PCA apply to all "persons". The term "person" is defined in the Interpretation Act as including "any company or association of body of persons, corporate or unincorporated."
In practice, however, the authorities' enforcement efforts have focused predominantly on individuals, with prosecutions against corporates entities for corruption offences being rare to date.
Under Swiss criminal law, criminal liability primarily rests with the individuals. In cases of bribery of public officials and commercial bribery, however, there is a parallel corporate criminal liability for failing to take all reasonable organisational measure that would have been required to prevent the bribery offences, making the failure to implement an appropriate compliance organization a potential criminal offence. There is no mandatory guidance on the features an appropriate compliance organization should have, but in practice the established international standards for compliance programs are applied by corporate entities and the state authorities. See also question no. 13 below.
Both individuals and corporates can be held liable for bribery, with the exception of offences under Section 7 of the Bribery Act, which applies only to corporate bodies.
Senior officers can be held liable for the offences of their organisation if they consented to or connived in the offence and had a close connection to the UK.
Individuals and companies can both be held liable under anti-corruption laws in Canada.
The Criminal Code applies to ‘everyone’ in Canada. The definition in Section 2 of ‘everyone’, includes ‘public bodies, bodies corporate, societies, companies’.
Section 22.2 of the Criminal Code extends criminal liability to a body corporate when one of its senior officers is:
- acting within the scope of their authority, is a party to the offence;
- acting within the scope of their authority, directs the work of other representatives so that they commit the act or omission specified in the offence; or
- knowing a representative is or is about to be party to the offence, does not take all reasonable measures to prevent them from doing so.
Criminal Code Section 2 defines ‘senior officer’ as:
a representative who plays an important role in the establishment of the organisation’s policies or is responsible for managing an important aspect of the corporation's activities and, in the case of a body corporate, includes a director, its chief executive officer and its chief financial officer.
The court in R v. Pétroles Global, 2013 QCCS 4262, held that an employee need not be senior management or a member of the board of directors to constitute a senior officer under Section 2 of the Criminal Code and therefore engage corporate criminal liability under Section 22.2. The court advanced that the title of an employee is not decisive, and courts may consider the full scope of what constitutes a ‘management position’.
Similarly, the CFPOA expressly applies to conduct by Canadian citizens, permanent residents and companies or corporate entities formed or incorporated in Canada. To date only one individual has been convicted under the act (R v. Karigar, 2013 ONSC 5199), despite the fact that several companies have been charged.
Individuals as well as corporate entities may be held civilly and criminally responsible for bribery.
As explained before, Law 27401 establishes criminal corporate liability for private legal persons, as defined in the Argentine Civil Code, including:
- Companies incorporated under any legal form (LLCs, PLCs, partnerships, etc.) whether of national or foreign capital and including private legal persons in which the State is a shareholder;
- Civil associations, foundations, mutual associations, cooperatives;
- Churches, confessions, religious communities or entities, and;
- Horizontal property regimes.
Notably, labour unions and their healthcare associations (“obras sociales sindicales”), professional associations and political parties are not considered “private legal persons” under Argentine law. Therefore, these entities are out of the statute's reach.
Private legal persons are liable for the corruption offenses committed, directly or indirectly, with their intervention or in their name, interest or benefit. The individual offenders may be employees or third parties -- even unauthorized third parties, provided that the legal person ratified the act, even tacitly.
The statute also establishes successor liability in cases of merger, acquisition or other forms of corporate transformation.
Individuals and also corporate entities (or equivalent entities) are liable for corruption. If a corporate entity is liable for corruption, the penalties are the following:
a) Court injunction;
b) Prohibition to carry out an activity;
c) Prohibition to execute certain agreements or to execute agreements with certain entities;
d) Closure of the establishment;
e) Publicity of the condemnatory decision.