{"id":4385,"date":"2019-12-19T09:40:00","date_gmt":"2019-12-19T07:40:00","guid":{"rendered":"https:\/\/honert.de\/?p=4385"},"modified":"2019-12-19T12:42:20","modified_gmt":"2019-12-19T10:42:20","slug":"draft-bill-on-corporate-liability-law-the-criminal-code-for-entrepreneurs","status":"publish","type":"post","link":"https:\/\/honert.de\/en\/draft-bill-on-corporate-liability-law-the-criminal-code-for-entrepreneurs\/","title":{"rendered":"DRAFT BILL ON CORPORATE LIABILITY LAW &#8211; THE CRIMINAL CODE FOR ENTREPRENEURS?"},"content":{"rendered":"\n<style type=\"text\/css\" data-created_by=\"avia_inline_auto\" id=\"style-css-av-1lpfb9-bbd9e27580a524d9e8f202361f5d454a\">\n.avia-section.av-1lpfb9-bbd9e27580a524d9e8f202361f5d454a{\nbackground-repeat:no-repeat;\nbackground-image:url(https:\/\/honert.de\/wp-content\/uploads\/3629.jpg);\nbackground-position:0% 0%;\nbackground-attachment:scroll;\n}\n<\/style>\n<div id='av_section_1'  class='avia-section av-1lpfb9-bbd9e27580a524d9e8f202361f5d454a main_color avia-section-default avia-no-shadow  avia-builder-el-0  el_before_av_section  avia-builder-el-first  hide_on_print avia-full-stretch avia-bg-style-scroll av-minimum-height av-minimum-height-40 av-height-40  container_wrap sidebar_right'  data-section-bg-repeat='stretch' data-av_minimum_height_pc='40' data-av_min_height_opt='40'><div class='container av-section-cont-open' ><main  role=\"main\" itemprop=\"mainContentOfPage\"  class='template-page content  av-content-small alpha units'><div class='post-entry post-entry-type-page post-entry-4385'><div class='entry-content-wrapper clearfix'>\n<\/div><\/div><\/main><!-- close content main element --><\/div><\/div><div id='av_section_2'  class='avia-section av-edopkl-e8c00ab1707ab54d73012c32d1642f4e main_color avia-section-default avia-no-shadow  avia-builder-el-1  el_after_av_section  avia-builder-el-last  avia-bg-style-scroll container_wrap sidebar_right'  ><div class='container av-section-cont-open' ><div class='template-page content  av-content-small alpha units'><div class='post-entry post-entry-type-page post-entry-4385'><div class='entry-content-wrapper clearfix'>\n\n<style type=\"text\/css\" data-created_by=\"avia_inline_auto\" id=\"style-css-av-cpbzz9-f5080a18e17126efd80653517ba6bcc0\">\n.flex_column.av-cpbzz9-f5080a18e17126efd80653517ba6bcc0{\nborder-radius:0px 0px 0px 0px;\npadding:0px 0px 0px 0px;\n}\n<\/style>\n<div  class='flex_column av-cpbzz9-f5080a18e17126efd80653517ba6bcc0 av_two_third  avia-builder-el-2  el_before_av_two_third  avia-builder-el-first  first flex_column_div av-zero-column-padding  '     ><style type=\"text\/css\" data-created_by=\"avia_inline_auto\" id=\"style-css-av-k486elj2-3892d8a778839b1a8b90ec7b4e08bd25\">\n#top .av-special-heading.av-k486elj2-3892d8a778839b1a8b90ec7b4e08bd25{\npadding-bottom:10px;\n}\nbody .av-special-heading.av-k486elj2-3892d8a778839b1a8b90ec7b4e08bd25 .av-special-heading-tag .heading-char{\nfont-size:25px;\n}\n.av-special-heading.av-k486elj2-3892d8a778839b1a8b90ec7b4e08bd25 .av-subheading{\nfont-size:15px;\n}\n<\/style>\n<div  class='av-special-heading av-k486elj2-3892d8a778839b1a8b90ec7b4e08bd25 av-special-heading-h1 blockquote modern-quote  avia-builder-el-3  avia-builder-el-no-sibling '><div class='av-subheading av-subheading_above'>19. December 2019\n<\/div><h1 class='av-special-heading-tag '  itemprop=\"headline\"  >DRAFT BILL ON CORPORATE LIABILITY LAW &#8211; THE CRIMINAL CODE FOR ENTREPRENEURS?<\/h1><div class=\"special-heading-border\"><div class=\"special-heading-inner-border\"><\/div><\/div><\/div><\/div>\n<style type=\"text\/css\" data-created_by=\"avia_inline_auto\" id=\"style-css-av-b8ts51-65d21f381f0c3b8fee085862049ea3da\">\n.flex_column.av-b8ts51-65d21f381f0c3b8fee085862049ea3da{\nborder-radius:0px 0px 0px 0px;\npadding:0px 0px 0px 0px;\n}\n<\/style>\n<div  class='flex_column av-b8ts51-65d21f381f0c3b8fee085862049ea3da av_two_third  avia-builder-el-4  el_after_av_two_third  el_before_av_two_third  first flex_column_div av-zero-column-padding  column-top-margin'     ><section  class='av_textblock_section av-k486f2n3-d11f394abc0eae40162f6f2e4d30662e '   itemscope=\"itemscope\" itemtype=\"https:\/\/schema.org\/BlogPosting\" itemprop=\"blogPost\" ><div class='avia_textblock'  itemprop=\"text\" ><p><strong>The Federal Ministry of Justice and Consumer Protection presented under the name \u201cCorporate Liability Law [Verbandssanktionengesetz]\u201d the draft bill on combating corporate crime. If the Grand Coalition implements this draft in its planned form in the legislative process, practice will face far-reaching challenges. It is therefore advisable to already familiarize with the planned changes.<\/strong><!--more--><\/p>\n<\/div><\/section><\/div>\n<style type=\"text\/css\" data-created_by=\"avia_inline_auto\" id=\"style-css-av-8intx1-b1806c19f815085f69b2849178ee8c70\">\n.flex_column.av-8intx1-b1806c19f815085f69b2849178ee8c70{\nborder-radius:0px 0px 0px 0px;\npadding:0px 0px 0px 0px;\n}\n<\/style>\n<div  class='flex_column av-8intx1-b1806c19f815085f69b2849178ee8c70 av_two_third  avia-builder-el-6  el_after_av_two_third  el_before_av_one_third  first flex_column_div av-zero-column-padding  column-top-margin'     ><section  class='av_textblock_section av-k486icoo-c35a5dcdb4bdd6a4437e57a93710c757 '   itemscope=\"itemscope\" itemtype=\"https:\/\/schema.org\/BlogPosting\" itemprop=\"blogPost\" ><div class='avia_textblock'  itemprop=\"text\" ><h2>I. Background<\/h2>\n<p>So far, German criminal law has only known the punishability of a natural person. Sanctions can so far be only imposed on enterprises within the framework of fine proceedings within the meaning of the Act on Regulatory Offenses [<em>Ordnungswidrigkeitsgesetz<\/em>] or on the basis of relevant special laws if a person in a managing position committed a criminal offense or an administrative offense. There has long been a discussion as to whether Corporate Liability Law should also be introduced in Germany, as is the case in many other Western countries. In the Coalition Agreement of the Grand Coalition dated 12 March 2018 it has been agreed to reorganize the sanctions law with the aim of strengthening the sanctioning of companies. The draft bill by the Federal Ministry of Justice is the first step towards implementing this agreement.<\/p>\n<h2>II. Planned reform<\/h2>\n<p>The draft law aims to remove the punishment of offenses committed by associations from the Act on Regulatory Offenses and to transfer this punishment to a newly created independent legal basis. The following regulations have to be particularly observed in this new Corporate Liability Law. <\/p>\n<h5>1. Introduction of principle of legality<\/h5>\n<p>In the Act on Regulatory Offenses the opportunity principle applies, according to which the punishment and prosecution lies in the within the obligatory discretion of the prosecution authority. The Corporate Liability Act is now to introduce the principle of legality. This means that the Public Prosecutor&#8217;s Office is obliged to initiate investigation proceedings against the company if there is initial suspicion of an offense committed by an association.<br \/>\nThe aim is to ensure that the applicable law is applied equally to all and that prosecution is no longer dependent on the individual prosecuting authority. However, due to the corresponding applicability of the termination possibilities of sections 153 et seq. German Code of Criminal Procedure [<em>Strafprozessordnung &#8211; StPO<\/em>] anticipated in the draft, the termination of the investigation procedure is still possible for opportunity reasons. For example, it is still conceivable to refrain from further investigations due to the insignificance of an offense committed by an association. However, such an application of the opportunity principle should be of an exceptional nature in the future. In any event, termination due to staff shortages or an excessively complex investigation procedure is no longer an option, which is likely to place an additional burden on the judiciary.<\/p>\n<h5>2. The system of sanctions<\/h5>\n<p>The draft distinguishes between 3 forms of sanctioning:<\/p>\n<ul>\n<li>the monetary sanction of associations;<\/li>\n<li>the warning with reservation of corporate liability; and<\/li>\n<li>the dissolution of the association.<\/li>\n<\/ul>\n<p>With regard to the monetary sanction of associations, the penalty framework varies depending on the turnover level of the company.<br \/>\nAssociations with an average annual turnover of more than EUR 100 million must expect a monetary penalty of at least EUR 10,000 up to a maximum of 10 percent of the average annual turnover in the event of an intentional offense committed by the association. Within the framework of negligent offenses committed by an association, the company should expect a sanction of at least EUR 5,000 up to a maximum of 5 percent of the average annual turnover. For smaller companies that do not reach the aforementioned turnover threshold, the current maximum sanction limit of EUR 10 million continues to apply.<br \/>\nFurthermore, the procedure can also be terminated by a warning with the reservation of corporate liability. The prerequisite for this is that the court considers a warning to be sufficient to prevent future offenses committed by the association, that a weighing of all circumstances makes the imposition of a monetary penalty unnecessary and that no monetary penalty is required with regard to the defense of the legal system. In such a case, the court should be able to impose various requirements and instructions on the company. It may, in particular, order certain compliance measures to be taken to improve the prevention of criminal offenses. As proof of compliance with these measures, an independent and competent body can be appointed to monitor the company.<br \/>\nIn the case of a particularly serious case of the persistent perpetration of considerable offenses committed by the association, the draft even provides for the dissolution of the association as a last resort. This sanction instrument, which is also referred to as the corporate death penalty, is met with considerable criticism from politics and literature, so that it remains to be seen whether this regulation will make it through the legislative process at all.<\/p>\n<h5>3. Naming and shaming<\/h5>\n<p>The court should also be able to order the public announcement of the conviction of an association if the offense affects a large number of injured parties.<br \/>\nThe justification of the law states that there is no intention of naming and shaming, but that the injured parties should be informed of the facts relevant to them. Nevertheless, the instrument foreseen in the draft is likely to constitute a pillory effect. <\/p>\n<h5>4. Mitigation of penalties through compliance measures<\/h5>\n<p>With regard to the amount of any sanction, the draft bill provides for the possibility of mitigating the penalty. Accordingly, compliance measures in favor of the companies are particularly to be considered. Such measures may even result in the undertaking being warned only if it can show that the specific incident is merely an exemption and that, in principle, effective measures have been taken to avoid the infringement in question.<br \/>\nIn addition, internal investigations to investigate criminal offenses are taken into account in order to mitigate sanctions. However, association internal investigations only have a mitigating effect under certain circumstances. If the association commissions a third party to conduct the investigation, the third party may not be the defender of the association or one of the accused. In accordance with the justification of the law, conflicts with the criminal defense mandate are to be avoided in this way.<br \/>\nIn addition, the association is required to cooperate uninterruptedly and without restrictions. The documents relating to the investigation must be made available in full to the prosecuting authorities.<br \/>\nThe internal investigation must be conducted in accordance with the principles of a fair trial. In concrete terms, this means that employee surveys must draw attention to any right to refuse to provide information and to the possibility of a lawyer being called in. The association must further make a substantial contribution to clarify the facts of the case. If the company fulfils these strict conditions, the maximum sanction of the association&#8217;s fines will be reduced by half and the minimum will be completely abolished. In addition, a dissolution of the association and naming and shaming would then no longer be possible.   <\/p>\n<h2>III. Conclusion<\/h2>\n<p>The draft bill of the new Corporate Liability Law provides for much more sensitive sanctions against companies than the previous legal situation. Due to the introduction of the principle of legality, the number of criminal investigation proceedings against companies is likely to increase significantly in the future.<br \/>\nDue to the planned legal incentives, compliance measures and internal investigations will continue to gain in importance.<br \/>\nGiven the very controversial discussion of the draft, there are some indications that there will still be certain changes in the course of the legislative process. In addition, the draft provides for a two-year transitional period until the law comes into force. From the company&#8217;s point of view, however, it seems advisable to start now to carefully check existing compliance systems for their effectiveness and any gaps and to adjust them if necessary in order to avoid excessive sanctions in the event of subsequent compliance violations. This applies not only to large companies, but also to traditional small and medium-sized enterprises, since the Corporate Liability Law will apply to companies of all sizes.<\/p>\n<\/div><\/section><\/div>\n<style type=\"text\/css\" data-created_by=\"avia_inline_auto\" id=\"style-css-av-843s6d-f3fbba989ffd5e9f7845b4e904fbd2c9\">\n.flex_column.av-843s6d-f3fbba989ffd5e9f7845b4e904fbd2c9{\nborder-radius:0px 0px 0px 0px;\npadding:7px 0px 0px 0px;\n}\n<\/style>\n<div  class='flex_column av-843s6d-f3fbba989ffd5e9f7845b4e904fbd2c9 av_one_third  avia-builder-el-8  el_after_av_two_third  avia-builder-el-last  sy-only-desktop hide_on_print flex_column_div  column-top-margin'     ><p><div  class='avia-builder-widget-area clearfix  avia-builder-el-9  el_before_av_textblock  avia-builder-el-first '><section id=\"categories-3\" class=\"widget clearfix widget_categories\"><h3 class=\"widgettitle\">Newsletter issues<\/h3>\n\t\t\t<ul>\n\t\t\t\t\t<li class=\"cat-item cat-item-272\"><a 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href=\"https:\/\/honert.de\/en\/category\/2017-q4-en\/\">2017 Q4<\/a>\n<\/li>\n\t<li class=\"cat-item cat-item-116\"><a href=\"https:\/\/honert.de\/en\/category\/2017-q3-en\/\">2017 Q3<\/a>\n<\/li>\n\t<li class=\"cat-item cat-item-114\"><a href=\"https:\/\/honert.de\/en\/category\/2017-q2-en\/\">2017 Q2<\/a>\n<\/li>\n\t<li class=\"cat-item cat-item-142\"><a href=\"https:\/\/honert.de\/en\/category\/deals-en\/\">Deal Announcements<\/a>\n<\/li>\n\t<li class=\"cat-item cat-item-58\"><a href=\"https:\/\/honert.de\/en\/category\/uncategorized\/\">Uncategorized<\/a>\n<\/li>\n\t\t\t<\/ul>\n\n\t\t\t<span class=\"seperator extralight-border\"><\/span><\/section><\/div><br \/>\n<section  class='av_textblock_section av-k486iogg-932bb5991dcc71738a2304d1ae0e0768 '   itemscope=\"itemscope\" itemtype=\"https:\/\/schema.org\/BlogPosting\" itemprop=\"blogPost\" ><div class='avia_textblock'  itemprop=\"text\" ><h2>More information on this topic<\/h2>\n<ul>\n<li><a href=\"http:\/\/9zh.f5b.myftpupload.com\/en\/taetigkeitsgebiete\/corporate-law\/\">Corporate Law<\/a><\/li>\n<\/ul>\n<p>\u00a0<\/p>\n<\/div><\/section><br \/>\n\n<style type=\"text\/css\" data-created_by=\"avia_inline_auto\" id=\"style-css-av-cxmmd-45fe3e128f38ae43872bf412f14fd63a\">\n#top .hr.hr-invisible.av-cxmmd-45fe3e128f38ae43872bf412f14fd63a{\nheight:8px;\n}\n<\/style>\n<div  class='hr av-cxmmd-45fe3e128f38ae43872bf412f14fd63a hr-invisible  avia-builder-el-11  el_after_av_textblock  el_before_av_textblock '><span class='hr-inner '><span class=\"hr-inner-style\"><\/span><\/span><\/div><br \/>\n<section  class='av_textblock_section av-1waaqd-e7a98d56556e59805f636334a98232ec '   itemscope=\"itemscope\" itemtype=\"https:\/\/schema.org\/BlogPosting\" itemprop=\"blogPost\" ><div class='avia_textblock hide_on_print'  itemprop=\"text\" ><h2>Downloads<\/h2>\n<p><a href=\"#\" onclick=\"window.print();return false\">Print<\/a><br \/>\n\n\n\n\t<div class=\"dkpdf-button-container\" style=\" text-align:left \">\n\n\t\t<a class=\"dkpdf-button\" href=\"\/en\/wp-json\/wp\/v2\/posts\/4385?pdf=4385\" target=\"_blank\"><span class=\"dkpdf-button-icon\"><i class=\"fa fa-file-pdf-o\"><\/i><\/span> Download (PDF)<\/a>\n\n\t<\/div>\n\n\n\n\n\n<\/p>\n<\/div><\/section><\/p><\/div><\/div><\/div><\/div><!-- close content main div --><\/div><\/div><div id='after_section_2'  class='main_color av_default_container_wrap container_wrap sidebar_right'  ><div class='container av-section-cont-open' ><div class='template-page content  av-content-small alpha units'><div class='post-entry post-entry-type-page post-entry-4385'><div class='entry-content-wrapper clearfix'>\n","protected":false},"excerpt":{"rendered":"<p>The Federal Ministry of Justice and Consumer Protection presented under the name \u201cCorporate Liability Law [Verbandssanktionengesetz]\u201d the draft bill on combating corporate crime. If the Grand Coalition implements this draft in its planned form in the legislative process, practice will face far-reaching challenges. It is therefore advisable to already familiarize with the planned changes.<\/p>\n","protected":false},"author":26,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"mc4wp_mailchimp_campaign":[],"footnotes":""},"categories":[156,156],"tags":[],"class_list":["post-4385","post","type-post","status-publish","format-standard","hentry","category-2019-q4-en"],"acf":[],"_links":{"self":[{"href":"https:\/\/honert.de\/en\/wp-json\/wp\/v2\/posts\/4385","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/honert.de\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/honert.de\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/honert.de\/en\/wp-json\/wp\/v2\/users\/26"}],"replies":[{"embeddable":true,"href":"https:\/\/honert.de\/en\/wp-json\/wp\/v2\/comments?post=4385"}],"version-history":[{"count":15,"href":"https:\/\/honert.de\/en\/wp-json\/wp\/v2\/posts\/4385\/revisions"}],"predecessor-version":[{"id":4463,"href":"https:\/\/honert.de\/en\/wp-json\/wp\/v2\/posts\/4385\/revisions\/4463"}],"wp:attachment":[{"href":"https:\/\/honert.de\/en\/wp-json\/wp\/v2\/media?parent=4385"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/honert.de\/en\/wp-json\/wp\/v2\/categories?post=4385"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/honert.de\/en\/wp-json\/wp\/v2\/tags?post=4385"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}