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Legislation establishing criminal liability and clear penalties for companies has come into force in Spain.
Offences for which a firm can be held liable include fraud with public subsidy, environmental misdemeanours, human trafficking, toxic dumping and bribery. Punishments outlined so far include fines, closures for up to five years, exclusion from government contracts and even company dissolution.
Lawyers have predicted, however, that having a suitable established corporate compliance programme could be viewed by the courts as mitigation and could exempt businesses from criminal liability. The law says companies will be charged if there is evidence that they lack ‘due control’.
The law, passed in June 2009, also makes businesses liable if crimes are ‘committed on their behalf or to their benefit’ by employees. Spain’s penal code had previously held only individuals criminally liable, though companies could be ordered to pay fines imposed on their staff.
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