CRIMINAL LIABILITY OF LEGAL ENTITIES.

The “Criminal liability of legal entities,” such as a company or a public administration.

 

Typically, one thinks that criminal responsibility concerns only natural persons.

 

Still, in the entrepreneurial world, they have been showing themselves growingly not immune to illegal infiltration. Public decision-makers passed new rules, making the legal system more avant-garde.

Even in Italy, these rules passed under the pressure of international agreements.

How can we define the crimes of legal entities?

 

Criminal law general principles teach only natural persons are liable to criminal responsibility.

In addition, the precept of “personality” of criminal responsibility posed difficulties regarding the crime attribution to those who committed it concretely.

Theoretical problems in classifying the conduct of “legal persons” who are not individuals arose.

So, they decided to talk about the “administrative liability” of entities to distinguish it from the criminal liability of natural persons.

Evident differences in the treatment imposed on two criminally responsible offenders (the liable Entity and the physical executor). Penal and procedural rules of the Italian codes in force traditionally also apply to the legal “Entities.

As a matter of fact, can a company or Public Administration be incarcerated? Not for sure.

So, how can society stop worrying about becoming the victim of non-law-abiding companies? Besides, it has immense economic powers that go beyond national borders to sway political decisions.

 

The Legislator felt the need to have specifically designed rules.

 

New regulations to contain the phenomena of illegality affecting the legal economy by way of due process suitable procedures for ascertaining criminal responsibility.

Consequently, a company can answer for illegal conduct committed by its directors, officers, managers, or employees subject to the control of the former.

Conversely, the right to defend themselves is guaranteed to individuals and legal entities in the person of their legal representatives.

Then, in 2001, there was a real historical turning point in entrepreneurship following the new criminal laws. Entrepreneurs have slowly begun to grasp the implications of the new regulatory complex.

Although over ten years have passed, companies sometimes default on the obligations introduced with Legislative Decree No. 231 of 2001 and successive modifications.

The path toward legalization is very tiring for many companies, and many have decided to relocate their plants to countries with less restrictive laws.

The bewilderment caused by the new rules derives from the difficulty of the business world to grasp some aspects on which they pivot.

First, controlling the corporate enterprises’ activities requires the “organization and management model” and the associated “Supervisory Committee.”

 

The dual mechanism hardly compares with traditional risk and management control systems. Say the Board of Statutory Auditors, internal or external audits, and auditing firms.

In conclusion, public and private companies Overseers did not realize there was something new. They can’t yet figure out that the new mechanism prevents specific crimes of law commission—the ones prohibited by the same Decree within the company structure.

Namely, it’s not a control matter over civil, accounting, commercial, and fiscal compliance—a device presenting completely new peculiarities that distinguish it from all preceding it.

Secondly, the entrepreneurial culture did not immediately make it out.

 

There is a need to adapt without delay to the new regulatory reality. More importantly, convictions and dramatic consequences in several cases of bankruptcies of large companies followed. Especially at the first impact of these norms’ application.

 

Italynlaw Law Firm Communications Office issued this Article.

Image 11: Elephant stands on a thin branch of a withered tree in a surreal landscape.

Source: Istockphoto.com.

In addition, click the link to watch and listen to the Video. It will last 6.49 minutes:

 

https://youtu.be/Os7o1LRuMt0.

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