Published and draft legislation - Spain

Statutory exemption of legal entities from criminal liability

Organic Law 1/2015, amending the Criminal Code, 30th March (effective 1st July)

On 1st July, Organic Law 1/2015, 30th March, came into force, amending Organic Law 10/1995, 23rd November, on the Criminal Code. One of the main reforms it includes affects the criminal liability of legal entities, introduced in Spain under Organic Law 5/2010, 22nd June.

The most significant changes are:

  • It considers the adoption of an effective crime prevention scheme, prior to the crime, to be grounds for exemption from criminal liability. Article 31bis details the minimum content of such a scheme, which must:
  1. Identify the activities in which crimes can be committed.
  2. Establish protocols for making and implementing decisions with respect to these crimes.
  3. Establish management models with sufficient funding to prevent these crimes.
  4. Impose reporting obligations to the Supervisors regarding possible risks and breaches.
  5. Establish a disciplinary system to punish breaches of these measures.
  6. Periodically check that the system is suitable for preventing these crimes.

If the prevention scheme only partially meets these minimums or if it is set up after the crime is committed, it will be taken into account as an extenuating circumstance that may reduce the penalties.

  • It establishes that the scheme should be implemented and monitored by an independent chief compliance officer, legally entrusted with the duty of monitoring the effectiveness of the company’s internal controls. For small companies, it includes the possibility of oversight and control activities being conducted by the board.
  • It increases the number of persons that can trigger the criminal liability of legal entities. Thus, in addition to the company’s de facto and official legal proxies and directors, referred to in the previous legislation, it also includes all persons authorized to make decisions on behalf of the legal entity or who hold powers of organisation and control within it.
  • In order hold legal entities criminally liable, the law requires that they gain a direct or indirect benefit from the actions of their directors.

Although this law does not elaborate on the characteristics, structure and content of prevention model, or determine how to configure the internal supervisory and control body, it is clear that Spanish companies wishing to claim exemption from criminal liability should define their scheme according to what is known as the "effective compliance program" under United States law.

The lack of definition means a wider focus can be given to promoting the values ​​needed to deter unethical actions rather than focussing narrowly on the standards or guidelines of the schemes. Although the reform introduces a defence against charges of criminal liability it is not compulsory so companies are free to adopt its recommendations or not.

Moreover, such schemes have an appreciable advantage as they can become drivers for spreading the uptake of positive business ethics.