Corporate Criminal Liability in Germany – the draft Corporate Sanctions Act Dr. Adrian Jung Public Prosecutor Federal Ministry of Justice and Consumer Protection

Current legal situation in Germany Corporate offences may only be punished as „administrative offence“ Maximum fine: 10 Million Euros „Excessive“ amounts are confiscation based No concrete assessment rules for fines Prosecution is in the discretion of responsible authorities

Objectives of the draft Corporate Sanctions Act Sanctioning of all criminal offences committed by either executive personnel or other persons if executive personnel has violated its supervisory duties Effective law enforcement throughout Germany Extension of sanctions Extension of procedural rights for companies Establishing assessment rules for sanctions No sentencing guidelines Compliance and internal investigations are taken into account to mitigate sanctions Options for procedure settings without a verdict

Effective law enforcement throughout Germany Current situation: Principle of Opportunity Draft act: Principle of Legality

Extension of sanctions Maximum fine: 10 Million Euros „Excessive“ amounts are confiscation based (only profit) Current situation: „Wandering“ sanction limit: 10 Million Euros 10% of the turnover for companies with a turnover over 100 Million Euros Public announcement of the verdict Liquidation of the company In addition: confiscation of the proceeds (not only profit) Draft Act:

Extension of procedural rights for companies Company obtains the rights of a suspect or an accused person Especially: Right to remain silent Right to apply to court

Establishing assessment rules for sanctions Dispensing with prosecution Internal investigations Compliance measures

Promotion of compliance measures Effective compliance measures are taken into account to mitigate sanctions An offence committed does not speak against an effective compliance No window dressing

Incentives for internal investigations Decrease of sanction framework by half No public announcement of the verdict No liquidation of the company Written proceeding without public trial mandatory Requirements Unbiased internal investigation unconditional and permanent cooperation with the public prosecutor´s office Handover of all documents Adherence to a “fair” procedure with regard to the interviewed employees

Dispensing with prosecution Non-prosecution of petty offences Significance of the offence committed is considered to be of a minor nature Severity and extent of the failure of the company to take reasonable precautions to avoid any offences does also play a role for the “minor nature” of the offence No public interest in the prosecution Non-prosecution subject to imposition of conditions and directions Public prosecution office may dispense with the preferment of public charges and concurrently impose conditions on and issue directions to the company if these are of such a nature as to eliminate the public interest in prosecution and if the significance of the offence committed and also the severity and extent of the failure of the company to take reasonable precautions to avoid any offences does not present an obstacle thereto.

Thank YOU for Your Attention!