New corporate criminal liability to come into force in Poland

The government draft of the Act on liability of collective entities for acts prohibited under the penalty institutes a new corporate criminal liability regime in Poland. The article presents brief outlook of main changes to be introduced in the scope of criminal law and compliance.

The Polish Parliament is currently working on the Act of the new law on corporate criminal liability which will cover all commercial companies regardless of the size and scope of their activities, share capital or assets.

The draft concerns two issues – new criminal liability of companies and compliance obligations. If the new law enters into force, a legal obligation to implement a coherent compliance management system will be established in Poland.

The draft changes ineffective corporate criminal liability regime in force at present. Until now, companies could only be held liable for some of the crimes committed by their representatives - after their final conviction in the criminal proceedings. After amendment, the company’s conviction of any crime committed directly in connection with its activities, even if the offender has not been detected (anonymous guilt), will be possible. Furthermore, the Companies will be held criminally liable for the offences committed not only by members of its boards but also proxies, directors of branches, all persons employed [not only employees, also B2B] and in some cases for its subcontractors.

At the same time, the Act will oblige companies to implement a compliance management system or verify existing compliance regulations. According to the draft, CMS shall at least consist of:

1. procedure for reporting abuse/whistleblowing procedure
2. internal investigation procedure
3. code of conduct
4. counteracting abuse procedure/crisis management policy

Moreover, the Companies will be obliged to implement division of competences and responsibilities between members of management and employees, adopt organizational chart, scope of duties and appoint a person responsible for supervising compliance department (compliance officer; in-house lawyer).

Failure to comply with new obligations will be severely punished - dissolving the company or a financial penalty in the amount of PLN 30,000 to 30,000,000 will be possible. Additionally, enforcement agencies will be entitled to verify whether the company has conducted an internal investigation in case of a suspicion of abuse. If such proceedings have not been carried out, it will be possible to double potential fine up to PLN 60,000,000.

The new corporate criminal liability regime along with compliance obligations will be a revolution for Polish entrepreneurs. For sure it will set out new directions to internal rules and corporate investigations and may change approach to possible cooperation with prosecuting authorities.

By Ewelina Rutkowska
Lawyer at Raczkowski Paruch, Business Crime and Compliance Practice
Warsaw, Poland