ELI Corporate Criminal Liability in the European Union

Background

Corporations contribute to and profit from crime. From the point of view of society, it only seems fair to hold them liable for crimes committed to their benefit by an individual linked to a legal entity. However, the liability of corporations for crime is a complex legal question. As a legal entity is a legal fiction, its acts are performed through human beings. The question of how the conduct of human beings can be attributed to the legal entity (by a formal relationship or by a material criterion) is a difficult one.

As a consequence, European Union Member States show very different approaches to the issue of corporate liability. The liability of legal persons for punishable acts is not recognised as criminal in all countries or, where recognised, might not be prosecuted in practice. In some jurisdictions corporate liability is subsidiary or alternative to individuals’ liability, while in other countries entities are prosecuted together with their employees.

Aim

The project aims at providing guidance to national legislators and/or the EU by proposing a framework for harmonising rules of responsibility and sanctions imposed on corporations for crimes. A (more) harmonised approach to corporate liability for crimes throughout the EU would allow for more effective prosecution of actions and a better European response to crime. This would contribute to a more secure environment in the EU for citizens, companies and professionals. Moreover, a harmonised approach to the issue of corporate liability appears necessary to improve the protection of the EU’s financial interests in accordance with art 325 of the Treaty on the Functioning of the European Union (TFEU) and to the objectives set out by the PIF Directive (Directive (EU) 2017/1371 on the fight against fraud to the Union's financial interests by means of criminal law).

Outcome

The Project Team will develop a set of Model Rules on corporate criminal liability and sanctions applied to corporations for crimes committed to their benefit by individuals.

In doing so, it will consider existing legislation and case law in the EU and its Member States as well as comparative studies. The topic of corporate criminal liability will furthermore be considered from a procedural point of view, as the ‘artificial’ nature of the entity also influences the application of procedural provisions designed for human beings.

Background materials (including comparative studies on the Czech Republic, France, Germany, Italy, Lithuania, the Netherlands, Poland and Sweden) will also be conducted.