Poland: New rules for criminal liability of corporate entities

Poland
Available languages: PL

The Ministry of Justice has introduced a new draft bill of the Law on liability of corporate entities for crimes. The draft regulation sets new rules of liability and makes it possible to quickly and effectively impose and enforce penalties against corporate entities, including companies operating abroad. At the same time, the severity of penalties is supposed to be dramatically increased.

The most important proposed changes are:

  • Resigning from a closed list of crimes committed by individuals which can entail liability of the company – the new draft introduces liability for any crime, including criminal negligence.
  • Resigning from the requirement of the prior conviction of an individual – proceedings against a corporate entity could be conducted in parallel or even independently from proceedings against an individual.
  • New rules of liability – limiting the possibilities to exclude the company’s liability in case of culpable actions committed by members of its bodies (management board, supervisory board).
  • Requirement imposed on the company to explain facts indicated by a whistleblower and protection of whistleblowers against retaliation by the company. We have described another draft bill that is to introduce protection of whistleblowers in a separate Law-Now Alert.
  • Severe penalties, in particular: (i) PLN 30,000 - 30,000,000 fine, which may be doubled under certain conditions (resigning from the limit of 3% of annual revenue of the corporate entity) and (ii) dissolution or liquidation of the corporate entity.
  • A wider list of additional sanctions, in particular the possibility to order the confiscation (forfeiture) of all or part of the company’s assets. We have described the confiscation of assets in a previous Law-Now alert, which was part of an amendment concerning the new rules of confiscation of proceeds and instruments of crime.
  • A wider list of interim measures which can be imposed by the prosecutor, i.a. an interim ban on certain business operations
  • Possibility to voluntarily accept liability after meeting certain conditions
  • Discretionary decision of the prosecutor whether to indict a corporate entity, which will not be subject to judicial review
  • Liability of entities created as a result of a merger, division or transformation – no liability if not aware of the crime despite conducting due diligence.

The draft bill, if passed as law, will also apply to the liability of corporate entities for crimes committed before it entered into force, provided that previous conditions for their liability are met.

The draft bill is currently undergoing public consultations. We will keep you updated concerning any changes to the draft bill in future law-now alerts.