Corporate criminal liability and organizational failure under the Swiss criminal code

CORPORATE CRIMINAL LIABILITY AND COMPLIANCE PROGRAMS

VOLUME I

LIABILITY ‘EX CRIMINE’ OF LEGAL ENTITIES IN MEMBER STATES

EDITED BY

ANTONIO FIORELLA

COLLABORATORS

Nicola Selvaggi - Anna Salvina Valenzano - Enrica Villani

Scientific Direction

ROMA TRE UNIVERSITY: Antonio Fiorella (Project responsible) - Arturo Maresca - SAPIENZA UNIVERSITY OF ROME: Alfonso Maria Stile (Project responsible) - UNIVERSITÉ PARIS 1 PANTHÉON-SORBONNE OF PARIS: Stefano Manacorda (Project responsible) - Geneviève Giudicelli-Delage - UNIVERSIDAD DE CASTILLA-LA MANCHA: Luis Arroyo Zapatero (Project responsible) - Adán Nieto Martín

Estratto

JOVENE EDITORE 2012

This publication has been made with the financial support of the Criminal Justice programme of the European Commission (JLS/2008JPEN/009).

SCIENTIFIC RESEARCH UNITS:

ROMA TRE UNIVERSITY Prof. Antonio Fiorella (Project responsible); Prof. Arturo Maresca. Researchers: Dr. Nicola Selvaggi; Dr. Anna Salvina Valenzano; Dr. Enrica Villani; Dr. Micaela Vitaletti.

SAPIENZA UNIVERSITY OF ROME Prof. Alfonso Maria Stile (Project responsible). Researchers: Dr. Francesco Compagna; Dr. Vincenzo Mongillo; Dr. Maria Teresa Trapasso.

UNIVERSITÉ PARIS 1 PANTHÉON-SORBONNE OF PARIS Prof. Stefano Manacorda (Project responsible); Prof. Geneviève Giudicelli-Delage. Researchers: Prof. Haritini Matsopoulou; Prof. Raphael Parizot; Dr. Juliette Tricot.

UNIVERSIDAD DE CASTILLA-LA MANCHA Prof. Luis Arroyo Zapatero (Project responsible); Prof. Adán Nieto Martín. Researcher: Dr. Manuel Espinoza de los Monteros de la Parra.

DIRITTI D’AUTORE RISERVATI

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CHAPTER XIV

CORPORATE CRIMINAL LIABILITY AND ORGANIZATIONAL FAILURE

UNDER THE SWISS CRIMINAL CODE

Enrica Villani

TABLE OF CONTENTS: 1. Foreword. Outline of the subjective and objectivescope of application of the discipline. The imputation system. – 2. Thecommission of a felony (“Verbrechen”) or misdemeanour (“Vergehen”)«within an enterprise, in the exercise of commercial activities in accor-dance with the corporate purpose». Corporate offence as expression ofthe business “typical risk”. – 3. “Organizational failure” as imputationcriterion. A) In case of subsidiary responsibility (“subsidiäre Verant-wortlichkeit”). Corporate criminal responsibility for the “opacity” ofbusiness organisation. – 3.1. An overview on case law. – 4. B) In case ofprimary liability (“originäre Verantwortlichkeit”). The “blameworth-ness” of the entity for failing to prevent the commission of the offence.– 5. Duties of organisation: sources of law and self-regulation. – 6. Rele-vance and contents of compliance programs, particularly in the preven-tion of money-laundering and bribery. – 7. Sanctions and outline of pro-cedural law.

1. Foreword. Outline of the subjective and objective scope of ap-plication of the discipline. The imputation system

Corporate criminal liability was introduced at a general levelin 2003. Before the introduction of Federal Law amending theCriminal Code, it was only provided for in some sectors of sub-sidiary criminal law, such as criminal tax law, where it was con-ceived in accordance to the identification theory. The actual

wording of article 102 of Criminal Code1 derives from a path ofreform started at the beginning of the nineties through the or-chestration of different projects, of which it transposes the basicsettings2.

1 Article 102 introduced (as art. 100-quater) by Federal law dated 21.3.2003 (inforce from 1 October 2003) stipulates as follows: «If a felony or misdemeanour is com-mitted in an undertaking in the exercise of commercial activities in accordance with theobjects of the undertaking and if it is not possible to attribute this act to any specific nat-ural person due to the inadequate organisation of the undertaking, then the felony ormisdemeanour shall be attributed to the undertaking. In such cases, the undertakingshall be liable to a fine not exceeding 5 million francs. 2. If the offence committed fallsunder articles 260-ter, 260-quinquies, 305-bis, 322-ter, 322-quinquies or 322-septies paragraph 1or is an offence under article 4a paragraph 1 letter a of the Federal Act of 19 Dec. 19861

on Unfair Competition, the undertaking shall be penalised irrespective of the criminal li-ability of any natural persons, provided the undertaking is responsible for failing to takeall the reasonable organisational measures that were required in order to prevent such anoffence. 3. The court shall assess the fine in particular in accordance with the seriousnessof the offence, the seriousness of the organisational inadequacies and of the loss or dam-age caused, and based on the economic ability of the undertaking to pay the fine. 4. Un-dertakings within the meaning of this title are: a. any legal entity under private law; b.any legal entity under public law with exception of local authorities; c. companies; d. soleproprietorships […]» (English translation from http://www.admin.ch/ch/e/rs/311_0/a102.html; some different words could be used in next paragraphs).

The official German version is the following: «Wird in einem Unternehmen inAusübung geschäftlicher Verrichtung im Rahmen des Unternehmenszwecks ein Ver-brechen oder Vergehen begangen und kann diese Tat wegen mangelhafter Organisationdes Unternehmens keiner bestimmten natürlichen Person zugerechnet werden, so wirddas Verbrechen oder Vergehen dem Unternehmen zugerechnet. In diesem Fall wird dasUnternehmen mit Busse bis zu 5 Millionen Franken bestraft. 2. Handelt es sich dabeium eine Straftat nach den Artikeln 260-ter, 260-quinquies, 305-bis, 322-ter, 322-quinquies

oder 322-septies Absatz 1 oder um eine Straftat nach Artikel 4a Absatz 1 Buchstabe a desBundesgesetzes vom 19. Dez. 19861 gegen den unlauteren Wettbewerb, so wird das Un-ternehmen unabhängig von der Strafbarkeit natürlicher Personen bestraft, wenn demUnternehmen vorzuwerfen ist, dass es nicht alle erforderlichen und zumutbaren organ-isatorischen Vorkehren getroffen hat, um eine solche Straftat zu verhindern. 3. DasGericht bemisst die Busse insbesondere nach der Schwere der Tat und der Schwere desOrganisationsmangels und des angerichteten Schadens sowie nach der wirtschaftlichenLeistungsfähigkeit des Unternehmens. 4. Als Unternehmen im Sinne dieses Titels gelten:a. juristische Personen des Privatrechts; b. juristische Personen des öffentlichen Rechtsmit Ausnahme der Gebietskörperschaften; c. Gesellschaften; d. Einzelfirmen.»

2 See in particular the 1991 and 1998 projects. For the analysis of these projectssee ROTH, Responsabilité pénale de l’entreprise: modèles de réflexion, in ZStR, 1997, p.

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The liability is defined as criminal and concerns the “entre-prise” (“Unternehmen”), in the sense attached to this notion bythe same article 102, fourth paragraph, whereby “enterprises”are «legal entities under private law, legal entities under publiclaw, with the exception of local authorities, companies and soleproprietorships»3.

In the model outlined by the Swiss legislator a pivotal role inthe imputation system is played by the organisation of the enter-prise as a whole, and in particular by lacks of organisation. Theimputation is based on two principles: first, it has to be ascer-tained whether the offence has been committed «in an enterprisein the exercise of commercial activities in accordance with the cor-porate purpose»; afterwards, it has to be assessed whether a “defi-ciency in the organisation” attributable to the company emerges.This second criterion operates according to two different models.

In the first case (art. 102, paragraph 1), defined by schol-ars as case of subsidiary responsibility (“subsidiäre Verant-wortlichkeit”), the entity is held liable for the commission of anyoffence (apart from minor offences), whereby it «cannot be at-tributed to any specific natural person due to the inadequate or-ganisation of the enterprise» (in the German version «kann dieseTat wegen mangelhafter Organisation des Unternehmens keinerbestimmten natürlichen Person zugerechnet werden»).

In the second case (article 102, paragraph 2) – the so-called“primary” responsibility – the company is held liable regardlessof the punishability of natural persons «if it can be blamed fornot having adopted all necessary and reasonable measures toprevent such offence» («wenn dem Unternehmen vorzuwerfenist, dass es nicht alle erforderlichen und zumutbaren organ-

345, as well as MOREILLON, La responsabilité pénale de l’entreprise, in ZStR, 1999,p. 325.

3 The choice of attributing liability to legal person in the case of public law en-tities was criticized by scholars, because of, among others, the diversity of the nationalCanton regulation governing the matter of legal personality: MACALUSO, La respons-abilité pénale de l’entreprise, Geneva-Zurich, 2004, p. 103 et seq.

583CORPORATE CRIMINAL LIABILITY AND ORGANIZATIONAL FAILURE

isatorischen Vorkehren getroffen hat, um eine solche Straftat zuverhindern»). In this case, the entity can be held liable only forsome mens rea offences (criminal organisation, terrorist financ-ing, money laundering, bribery).

2. The commission of a felony (“Verbrechen”) or misdemeanour(“Vergehen”) «within an enterprise, in the exercise of com-mercial activities in accordance with the corporate purpose».Corporate offence as expression of the business “typical risk”

The principle whereby it is necessary that the wrongdoing iscommitted «within an entreprise, in the exercise of commercialactivities in accordance with the corporate purpose» is expresslystated only in the first paragraph of article 102. Nevertheless, ac-cording to the majority of scholars, it has to be regarded as refer-able either to the subsidiary and primary responsibility.

The expression used by Swiss Criminal Code was mainly in-terpreted with a view to limiting, on the one hand, the amount ofnatural persons whose offence can be attributed to the entityand, on the other, the “risks” attributable to the company.

Under the former viewpoint the reference to the commis-sion of crime «within an entreprise» («in einem Unternehmen»)was meant as a need for establishing a hierarchical or at least or-ganisational link between the agent and the entity. The formula,wide in any respect, would furthermore enable one to take intoaccount – apart from the business organs, de jure or de facto (ora member of the organ) – single associates, employees even if notholder of function as managers, and delegated persons. The lia-bility of the entity should however be excluded if the offencewere committed by assistants or agents, and certainly clients, ex-perts or third parties4. Moreover, in a reform perspective it has

4 PIETH, Die strafrechtliche Verantwortung des Unternehmens, in ZStrR, 2003, p.360; ID., Risikomanagement und Strafrecht, Risiko und Recht. Festgabe zum Schweizeri-schen Juristentag 2004, Basel, Genf, München, 2004, p. 605.

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been indicated the opportunity of limiting the liability of the en-tity only to actions of leading persons5.

The link between the offences committed and the exerciseof commercial activities in accordance with the corporate pur-pose would lead to attribute to the company only those criminalfacts constituting the “typical risks” of its (lawful and ordinary)activity. To these should be then added some general risks deriv-ing from the development of commercial activities as such6.

Furthermore, it was considered whether the principle of theconsistency of the business activity with the corporate purposescould introduce also a selection based on the relation betweenthe offence and the interests of the entity. In this respect, if somescholars exclude such a possibility (on the assumption that thecharges against the entity are based on its defective organisationand not on the circumstances that it has somehow “taken advan-tage” of the wrongdoing), other authors have instead consideredthat the company must not be held liable for facts committedagainst itself, for those which could not even potentially generatea profit for the entity, and for the facts committed exclusively inthe framework of organised action7.

5 STRATENWERTH, Voraussetzungen einer Unternehmenshaftung de lege ferenda, inZStrR, 2008, p. 9. This approach reflects a lack of consistency with the internationalconventions: CASSANI, L’internasionalisation du droit pénal économique et la politiquecriminelle de la Suisse: la lutte contro le blanchiment d’argent, in ZSR, 2008, p. 346.

6 MACALUSO, above at fn 3, p. 134 et seq., envisaged as typical risks the follow-ing: 1) for companies in the building sector, offences against life and personal integritycould be considered; for the companies in the chemical sector, offences against the en-vironment could be considered, as well as those against personal integrity; for IT com-panies, offences provided for in article 143 of the Criminal Code; for companies in thehospital sector, offences against life and personal integrity; for companies in the edu-cational sector or supervision (nursery…), offences against life and personal integrityand offences against sexual integrity; for companies in the finance sector, offencesagainst property, and in particular embezzlement (abuse of trust), unfair management,counterfeiting, money laundering, terrorist financing, but also failure of supervision infinancial transactions; for editing companies, offences against honor, pornography,racial discrimination, unfair competition.

7 HEINE, Das kommende Unternehmensstrafrecht, in ZStrR, 2003, p. 35; PIETH,Die strafrechtliche Verantwortung des Unternehmens, above at fn 4, p. 361. For these


3. “Organizational failure” as imputation criterion. A) In case ofsubsidiary responsibility (“subsidiäre Verantwortlichkeit”).Corporate criminal responsibility for the “opacity” of businessorganisation

A key factor in criminal liability is represented by lacks oforganisation, even if at different levels depending on whether itis subsidiary or primary.

In the first case, the imputation is based on the “impossibil-ity of attributing” wrongdoings to natural persons as a conse-quence of “lack of organization” for which entities may be ac-countable. The Swiss legislator aims in other words at blamingthe lack of transparency in the functioning of the entity. In this re-spect, a precise causal link is required between the impossibilityof identifying a natural person as the material author of crimeand the corporate mismanagement; this link, according to the in-terpretation of doctrine, should be established throughout themodel of the “adequate causality” (“adäquate Kausalität”)8.

It is instead not certain whether the law provision requiresthat the offence as such originates from a lack of organisation.By interpreting the law literally, also in view of the paragraphwhich follows, liability seems to disregard this relationship (be-tween the offence and the organizational failure). Hence, the or-ganization would be blamed not for the commission of a crime,but rather for its mismanagement, mostly interpreted as “opac-ity” of the organisational structure9.

In this perspective, the system gives rise to some doubts, inso far as it allows the entity to disregard its liability vis-à-vis thespecific event that occurred. These considerations have thereforeled some scholars to reconsider the meaning of the law provi-sion, maintaining, by the analogical application of paragraph 2 of

profiles, in Italian doctrine, see SELVAGGI, L’interesse dell’ente collettivo quale criterio diascrizione della responsabilità da reato, Naples, 2006, p. 131, n. 41.

8 MACALUSO, above at fn 3, p. 134 et seq.9 FORSTER, Die strafrechtliche Verantwortlichkeit des Unternehmens nach Art. 102

StGB, Bern, 2006, p. 213.

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article 102 (“originäre Verantwortlichkeit”), that is necessary toestablishing the derivation of the offence from mismanagementalso in the event of subsidiary responsibility10. This interpretation,absolutely notable and shareable, is unfortunately contradictedby the first interpretations in case law (infra, § 3.1), as well as bydoctrine11.

Quite problematic does appear as well the correct definitionof the “impossibility of attributing wrongdoings to a natural per-son”, at least in so far as the law provision relates the liability ofa company to crimes “committed” by natural persons. The ref-erence to the “commission” of a crime has led to believe that anoffence with all its elements, both objective and subjective, mustin any case exist. In this respect, for instance, it is stated that jus-tifications should also be applied in favour of the entity12. A fact,whenever the subject results not punishable for a cause of “ex-cuse”, cannot alike be attributed to the entity13.

The “impossibility of imputation” should thus exclude basi-cally the case in which the author of the offence was not identi-fied, whereas appropriate objective and subjective elements canbe somehow gathered with a view to substantiating the commis-sion of a crime. Besides, scholars have been placing several casesside by side – in a more complex manner – such as for instanceto the so called “cumulative tort”, which would take place whenmore individuals have caused the offence, without having thepossibility of ascertaining a relevant responsibility according tothe principles of participation and without the possibility of at-tributing the responsibility to the company top management forfailure to supervise14.

10 PIETH, Risikomanagement und Strafrecht, above at fn 4, p. 606.11 FORSTER, above at fn 9, p. 213.12 PERRIN, La responsabilité pénale de l’entreprise en droit suisse, in AA.VV., Cor-

porate Criminal Liability, by Pieth and Ivory, Basil, 2010, p. 206.13 See MACALUSO, above at fn 3, p. 142.14 HEINE, La responsabilità penale delle persone giuridiche in Svizzera, in CATE-

NACCI - MARCONI, Temi di diritto penale dell’economia e dell’ambiente, Turin, 2009,p. 268.


The deficiencies in the organisation for which the entity isto be held liable (see infra, § 6) basically consist in the violationof the general obligation of documentation, record keeping, andsupervision of human resources, to be accomplished by a cleardefinition of tasks, as well as through the planning of given pro-cedures of delegation together with the adoption of appropriatemeasures of control15.

3.1. An overview on case law

Broadly speaking, it has to be underscored that even thoughnearly nine years have elapsed from the entry into force of thediscipline, outstanding interpretations have not come out. Inparticular, apart from some proceedings still in the investigationphase, no significant decisions were made in federal case-law.Scholars interpreted the data as a demonstration of scarce ad-herence of the Swiss legislative model to the needs of its practi-cal application16.

One of the decisions presently known is an order dated 5January 2005 by the cantonal Tribunal of Friburg (Tribunal can-tonal de Fribourg)17, regarding precisely a conviction for sub-sidiary responsibility under article 100-quater, paragraph 1, in re-lation to a road traffic case. In particular, the company was rec-ognized responsible for the wrongdoing on the assumption that«le fait de ne pas pouvoir établir quel employé circule avec levéhicule d’entreprise à une date déterminée constitue un manqued’organisation de l’entreprise».

The decision was adopted because, from the investigationsit was not possible to establish who was the physical person dri-ving the vehicle who committed the infringement. It only re-sulted instead, that the vehicle together with others, had been

15 GEIGER, Organisationsmängel als Anknüpfunkt im Unternehmensstrafrecht,Zurich, 2006, p. 123; FORSTER, above at fn 9, p. 215.

16 CASSANI, above at fn 5, p. 347.

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hired by the accused company. However, the managing directorof the company, given the large number of employees (one hun-dred in Switzerland and six hundred in France), wasn’t able toindicate who was driving the vehicle at issue the day on whichthe infringement was committed. Moreover, the same managingdirector confirmed that not all the company vehicles were ho-mologated and that those were not even equipped with any ve-hicle documents. According to the judge, these data had to beinterpreted as demonstrative of an organisational defect signifi-cant to trigger the subsidiary liability of the company.

If the judgment does represent a first reference point in theframework of a case-law still tentative, nonetheless it lets roomfor some doubts. As a matter of fact, it does not appear that anyreal control was carried out in respect of the commission of theoffence “in the exercise of business activities consistent with thecorporate purpose”, nor with reference to the organisational lackas a reason for failing to identify the author of the wrongdoing18.Furthermore, the idea of disregarding the control on the exis-tence of a specific link between the organisational failure and thewrongdoing committed seems to be confirmed.

4. B) In case of primary liability (“originäre Verantwortlichkeit”).The “blameworthness” of the entity for failing to prevent thecommission of the offence

In the model of primary liability (paragraph 2, article 102),whereby the company is held liable also if natural persons com-mitting the offence were identified, the logic based on the as-sumption that the offence is the direct consequence of the orga-nizational failure becomes still more apparent: the entity is in

17 The order (“ordonnance pénale de condamnation”) is published in Revue fribourgeoise de jurisprudence, 2005, p. 59. See, recently, the summary punishment order of Attorney General of November 2011, which sanctions a company for bribery(in www.news.admin.ch).

18 See PERRIN, above at fn 12, p. 210, n. 64.


fact accountable upon condition that it can be blamed for fail-ing to have adopted all the necessary and reasonable measuresto prevent the offence (in the German version: «wenn dem Un-ternehmen vorzuwerfen ist, dass es nicht alle erforderlichen undzumutbaren organisatorischen Vorkehren getroffen hat, um einesolche Straftat zu verhindern»)19. The wording of this provisionimplies that the liability emerges irrespective of the punishabil-ity of natural persons20, and certainly requires a link of causalderivation of the offence from the organisational mismanage-ment21.

The requirement of establishing this link gives then a quitedifferent meaning to the organisational duties whose complianceexempts the entity from its liability.

Indeed, crime prevention imposes on the company theobligation to comply with general organisational duties22, as du-ties to take measures for staff recruitment and for its training, forproviding the control over the activities carried out by the com-pany as a whole; all on the basis of a preventive (criminal) riskassessment analysis.

Precisely, the link between the general organisational oblig-ations and crime prevention has led doctrine to put such systemof responsibility side by side with that of the top managementfor having failed to prevent the offences, within the meaning that

19 In the French version: «s’il doit lui être reproché de ne pas avoir pris toutes lesmesures d’organisation raisonnables et nécessaires pour empêcher une telle infraction».

20 In the framework of the concurrent responsibility - as no link of interdepen-dence between the liability of the entity and the natural person exists - it is believedthat the company has to be held liable for the offence also in those cases in which thenon punishability is not related to lacks of organisation but simply to reasons for nonprosecution or not individual punishability, as in case of death of the author of thecrime; would anyhow be excluded the causes which prevent from regarding the of-fence as “committed” (such as causes for exemption): MACALUSO, above at fn 3, p. 153.

21 PIETH, Die strafrechtliche Verantwortung des Unternehmens, above at fn 4, p.362; MACALUSO, above at fn 3, p. 155.

22 HEINE, above at fn 7, p. 29 et seq.; FORSTER, above at fn 9, p. 226; GEIGER,above at fn 15, p. 97 et seq.

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this has taken on in the evolution of Swiss case-law (reference ismade in particular to the “Von Roll” case”)23.

The pattern of liability for failure to prevent the offence wasthen enhanced with elements typical of the individual liabilityfor negligence24.

The valorisation of the subjective elements of the indictmentis heading in the same direction in referring to the “blameworth-ness” of the entity («wenn dem Unternehmen vorzuwerfen ist…»).

According to this approach, in order to ascertain whetherthe entity has complied with its organisational obligations, itshould be taken as a reference a sort of “collective agent” withthe business characteristics25. In this respect, the assessmentshould always strictly be made ex ante26.

23 HEINE, above at fn 7, p. 38 et seq.; ID., Organisationsverschulden ausstrafrechtlicher Sicht: Zum Spannungsfeld von zivilrechtlicher Haftung, strafrechtlicherGeschäftsherrenhaftung und der Strafbarkeit von Unternehmen, in Niggli (Hrsg.), Ver-antwortlichkeit im Unternehmen aus zivil- und strafrechtlicher Sicht, 2007, p. 5 of the ab-stract; PIETH, Die strafrechtliche Verantwortung des Unternehmens, above at fn 4, p. 363;ID., Risikomanagement und Strafrecht, above at fn 4, p. 607; GEIGER, above at fn 15, p.55; MACALUSO, above at fn 3, p. 150; FORSTER, above at fn 9, p. 227. The case (BGE 122,IV, 103) dealt with unauthorised trade in weapons. In particular the Von-Roll company,in violation of the KMG (Kriegsmaterialgesetz), had entered into millionaire contractsfor the supply of a cannon component for the Iraqi regime. In this respect, the federalCourt has established that: «a company which manufactures steel and builds war mate-rial is obliged to adopt security measures that automatically exclude the possibility ofaprioristic re-negotiations in breach of the law (KMG) in the company […]; in partic-ular this kind of company has the duty to adopt the necessary organizational measuresso that the lawfulness of the production and the exportation is controlled in case ofconcrete suspicion». The decision is reported because the company itself is indicated asliable for the organizational duty; in the parts of the judgment which follow the organsand the members of the organs or anyhow the top management of the entity is de-scribed as being responsibility for complying with these duties.

24 ROTH, Una responsabilité sanz culpabilité?, L’entreprise, la „faute d’organisa-tion“ et le droit pénal, in SJ, 2003, p. 201; HEINE, above at fn 7, p. 39; PIETH, Risiko-management und Strafrecht, above at fn 4, p. 607; ID., Internationale Anstösse zur Einführung einer strafrechtlichen Unternehmenshaftung in der Schweiz, in ZStR, 2001,p. 14; MACALUSO, above at fn 3, p. 154; FORSTER, above at fn 9, p. 227.

25 HEINE, above at fn 7, p. 40; PIETH, Risikomanagement und Strafrecht, above atfn 4, p. 608; FORSTER, above at fn 9, p. 228.

26 FORSTER, above at fn 9, p. 243.


The similarity to the model of individual liability for failingto prevent crime did not prevent some scholars from highlight-ing the distinctive features of this form of liability. Unlike topmanagement liability, entity liability should more correctly belinked to defective organisation as it emerged with the passing oftime, and the offence as a simple “opportunity” to sanction theentity27, or ultimately as an “objective condition for punishabil-ity”28. Moreover, according to this perspective, the connectionbetween the organisational failure and the offence should beevaluated throughout the “increase of risk of crime” derivingfrom the entity mismanagement (that has been defined as “eineverbandsspezifische Risikoerhöhungstheorie”)29.

Nevertheless, a global analysis of the discipline leads to con-sider the “primary” liability of the entity as a liability for the spe-cific offence occurred30.

This conclusion could also be maintained taking into ac-count the connection between the offence and the general inter-ests of the entity, which – at least according to some interpreta-tions – should be established at the level of crime commission31.

On the other hand, the idea of conceiving the causal linkbetween the lack and the offence as a generic increase of risk didnot appear convincing to the whole Swiss doctrine: some authorshave in fact envisaged the possibility of adopting more stringentrules for ascertaining the causes of the offence, somehow basi-cally equalized to those of “adequate causality” (“adäquateKausalität”)32.

27 HEINE, above at fn 7, p. 41.28 FORSTER, above at fn 9, p. 228.29 HEINE, above at fn 7, p. 40; ID., above at fn 23, p. 13 (of the abstract);

FORSTER, above at fn 9, p. 251.30 MACALUSO, above at fn 3, p. 148 and 149; PIETH, Risikomanagement und

Strafrecht, above at fn 4, p. 605 et seq.31 We make reference to the criterion of the commission of the offence “in the

exercise of business activities in line with the corporate purpose”: supra, § 2.32 MACALUSO, above at fn 3, p. 155. The author believes that the liability of the

entity has to be excluded for lack of the causal link between the organizational failure

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5. Duties of organisation: sources of law and self-regulation

Even though the notion of “defective organisation” mayhave different meanings (general lack of organisation as to pri-mary liability and lack of transparency as to subsidiary liability),it was then a question of identifying the actual measures to beadopted to rule out liability. As there is no express indication oncontents of organisational duties and no mention of instrumentslike compliance programs, it seemed appropriate to establish thescope of such duties.

The doctrine makes reference to indications set forth in dif-ferent levels of legislation for single business sectors concerningthe correct organisation of corporations with a view to preven-tion. Article 102, paragraphs 1 and 2, in its general wording, ac-tually includes an implicit reference to the various extra-criminalprovisions on preventive organisation33.

Therefore the problem is rather to identify the sources oflaw which legitimate reference can be made to. In particular, be-sides legislation, either civil or administrative, and secondarysources of law, according to prevailing opinion, the provisionslaid down by private entities (e.g. trade associations) and variousstandards of conduct may grow in importance, provided thatlegislation expressly refers to them34. If there is no statutory ref-erence (or in case of self-regulating provisions that have not beentransposed at a legislative level and are therefore not manda-tory), resort would be made to a “collective agent”, as men-tioned above, as a reference point to identify the “necessary andreasonable” measures to prevent the offence35.

On the other hand, prevailing doctrine considers that, evenif specific legislation is given, it is still necessary to adjust the or-

and the offence, when the natural person perpetrating the offence eluded the organi-sational measures adopted by the entity, because his behaviour appeared impre-dictable to the company.

33 FORSTER, above at fn 9, p. 215.34 PIETH, Risikomanagement und Strafrecht, above at fn 4, p. 609.35 PIETH, Risikomanagement und Strafrecht, above at fn 4, p. 608 et seq.


ganisational measures to the peculiarities of any single corpora-tion, and in particular to its size, so that compliance or non-com-pliance with these rules may be not enough as such to rule out oradmit the corporate entity’s liability. In this case, a violation ofthe rules would rather amount to a “clue” that a lack of organi-zation exists. On the contrary, compliance with these ruleswould imply a “presumption of correct organisation” in favourof the entity as a corporation that systematically applies statutoryindications cannot be held liable; in both cases it would be up tothe judge to make a decision after evaluating the actual circum-stances and the specific business environment36.

6. Relevance and contents of compliance programs, particularlyin the prevention of money-laundering and bribery

Doctrine has then addressed the problem of checkingwhether and in which cases, if any, the so-called compliance pro-grams could play a role.

The proposed solution is in line with the general remarks setout above: in particular, such programs may have an importantrole if there were an express reference to them in the legislation,including international law provisions. In these cases the adop-tion of a model would precisely exclude, rather than just miti-gate, corporate liability as is the case for the US system37.

Therefore this study mainly deals with the content of suchduties, taking into account each type of offence: for primary lia-bility, offences explicitly prescribed by law are considered; forsubsidiary liability, an insight is provided into the offences thatare traceable to a “typical risk” of businesses when violations are

36 MACALUSO, above at fn 3, p. 158. Here it is pointed out that it is up to theprosecution to prove what the suitable measure was supposed to be, which could bereasonably demanded, to prevent the commission of the offence: CASSANI, above at fn5, p. 346.

37 PIETH, Risikomanagement und Strafrecht, above at fn 4, p. 611 et seq.

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committed in the exercise of commercial activities in accordancewith the business purpose (supra, § 2)38.

In this perspective, doctrine has recognised general impor-tance to company law with respect to the aspects closely relatedto the company organisation39 (in particular the organisationalobligations imposed on the board of directors that may notbe delegated, the rules governing delegation in “sociétésanonymes”40 and – especially in relation to the subsidiary liabil-ity – the obligations to keep record of the decisions made by theboard of directors41). In the other cases attention was primarily

38 PIETH, Risikomanagement und Strafrecht, above at fn 4, p. 611 et seq.39 FORSTER, above at fn 9, p. 216 et seq.; GEIGER, above at fn 15, p. 140 et seq.40 Particular reference is made to article 716a of the Federal Law supplementing

the Swiss Civil Code (Bundesgesetz betreffend die Ergänzung des SchweizerischenZivilgesetzbuches): «(Abs. 1) Der Verwaltungsrat hat folgende unübertragbare und un-entziehbare Aufgaben: 1. die Oberleitung der Gesellschaft und die Erteilung der nötigenWeisungen; 2. die Festlegung der Organisation; 3. die Ausgestaltung des Rechnungswe-sens, der Finanzkontrolle sowie der Finanzplanung, sofern diese für die Führung derGesellschaft notwendig ist; 4. die Ernennung und Abberufung der mit der Geschäfts-führung und der Vertretung betrauten Personen; 5. die Oberaufsicht über die mit derGeschäftsführung betrauten Personen, namentlich im Hinblick auf die Befolgung derGesetze, Statuten, Reglemente und Weisungen; 6. die Erstellung des Geschäftsberichtessowie die Vorbereitung der Generalversammlung und die Ausführung ihrer Beschlüsse;7. die Benachrichtigung des Richters im Falle der Überschuldung. (Abs. 2) Der Verwal-tungsrat kann die Vorbereitung und die Ausführung seiner Beschlüsse oder dieÜberwachung von Geschäften Ausschüssen oder einzelnen Mitgliedern zuweisen. Er hatfür eine angemessene Berichterstattung an seine Mitglieder zu sorgen.». Then referenceis made to art. 716b: «(Abs. 1) Die Statuten können den Verwaltungsrat ermächtigen,die Geschäftsführung nach Massgabe eines Organisationsreglementes ganz oder zum Teilan einzelne Mitglieder oder an Dritte zu übertragen. (Abs. 2) Dieses Reglement ordnetdie Geschäftsführung, bestimmt die hierfür erforderlichen Stellen, umschreibt deren Aufgaben und regelt insbesondere die Berichterstattung. Der Verwaltungsrat orientiertAktionäre und Gesellschaftsgläubiger, die ein schutzwürdiges Interesse glaubhaftmachen, auf Anfrage hin schriftlich über die Organisation der Geschäftsführung. (Abs. 3)Soweit die Geschäftsführung nicht übertragen worden ist, steht sie allen Mitgliedern desVerwaltungsrates gesamthaft zu.»

41 Here reference is made to art. 713 of the Federal Law supplementing theSwiss Civil Code (Bundesgesetz betreffend die Ergänzung des Schweizerischen Zivilge-setzbuches) stipulating that: «1. Die Beschlüsse des Verwaltungsrates werden mit derMehrheit der abgegebenen Stimmen gefasst. Der Vorsitzende hat den Stichentscheid,sofern die Statuten nichts anderes vorsehen. 2. Beschlüsse können auch auf dem Wege


devoted to public law provisions regulating a number of sectorshighly concerned by corporate criminal liability, in particularprevention of money laundering in banking enterprises and pre-vention of bribery.

As to the former subject matter, doctrine has selected anumber of fundamental duties that are set forth in the rules introduced at various levels (especially in the Federal Law onthe Fight against Money Laundering of 10th October 1997 –GwG – and in an order made on 18th December 2002 by theFederal Authority in charge of supervising financial marketswith a view to preventing money laundering - GwV EBK42). Ful-filling such duties would constitute a minimum standard for anadequate compliance program or in any case for a law-abidingbusiness organization with a view to prevention. Therefore theanalysis of the risk of offences being committed43, training of

der schriftlichen Zustimmung zu einem gestellten Antrag gefasst werden, sofern nicht einMitglied die mündliche Beratung verlangt. 3. Über die Verhandlungen und Beschlüsse istein Protokoll zu führen, das vom Vorsitzenden und vom Sekretär unterzeichnet wird».

42 With respect to the 1997 Federal Law (GwG), particular importance is at-tached to article 8, prescribing that «financial intermediaries shall take, within their re-spective field of competence, the necessary measures to prevent money laundering andterrorist financing. In particular they shall train their staff adequately and carry outcontrols». With respect to the order made by the Federal Authority (GwV EBK) at-tention should be paid to the third section titled “organisational measures” (Articles 7- 13). At a private level primary importance is given to the provisions laid down in VSB2003 (Vereinbarung über die Standesregeln zur Sorgfaltpflicht der Banken) of the SwissBankers Association. In the context of international law reference is made to the FATF40 Recommendations of 1990. A further reference point is also article 305-ter of theCriminal Code („mangelnde Sorgfalt bei Finanzgeschäften und Melderecht“): «(abs. 1)Wer berufsmässig fremde Vermögenswerte annimmt, aufbewahrt, anlegen oder übertra-gen hilft und es unterlässt, mit der nach den Umständen gebotenen Sorgfalt die Identitätdes wirtschaftlich Berechtigten festzustellen, wird mit Freiheitsstrafe bis zu einem Jahroder Geldstrafe bestraft. (abs. 2) Die von Absatz 1 erfassten Personen sind berechtigt, derMeldestelle für Geldwäscherei im Bundesamt für Polizei Wahrnehmungen zu melden,die darauf schliessen lassen, dass Vermögenswerte aus einem Verbrechen herrühren.».For a full reconstruction of the law provisions used as a reference point see GEIGER,above at fn 15, p. 169 et seq.; FORSTER, above at fn 9, p. 232; PIETH, Risikomanagementund Strafrecht, 612.

43 This obligation is to be found in article 7 of the GwV EBK («Financial inter-mediaries shall lay down criteria for the identification of business relations that inply

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staff44, providing mechanisms of internal control (also by settingup ad hoc bodies)45, issuing internal guidelines46 and the adop-tion of specific procedural protocols47 are essential to preventmoney laundering.

The identification of sources for duties to prevent briberyhas turned out to be more complex. As there are no significantindications in the domestic rules, either legislative or regulatory,doctrine has prevailingly made reference to international provi-sions (in particular the Rules of conduct and Recommendations toCombat Extortion and Bribery adopted in 1999 by the Interna-tional Chamber of Commerce – ICC; and the Business Principlesfor Countering Bribery of 2002 – Transparency International)48. In

major risks related to law-abidance and reputation. With respect to the activities per-formed by financial intermediaries the following criteria shall apply: […]»), and asprescribed by article 8 («financial intermediaries shall lay down criteria for the identi-fication of transactions that imply major risks related to law-abidance and reputation.With respect to the activities performed by intermediaries the following criteria shallapply: […]»).

44 This obligation is found both in article 8 of the GwG and Article 11 of theGwV EBK: «the fight against money laundering and terrorist financing requires hon-est and adequately trained staff. Financial intermediaries shall accurately select staffand constantly train clients’ consultants and other collaborators who may be con-cerned by some aspects they deem essential in the fight against money laundering andterrorist financing»

45 This aspect is dealt with both in article 8 of the GwG and article 13 of theGwV EBK that prescribe the setting up of an “internal service to counter money laun-dering” that shall inter alia «supervise – in agreement with the internal review board,the auditing company and the persons in charge of the line – the application of inter-nal guidelines to counter money laundering and terrorist financing; it shall plan andsupervise internal training on the same subject matter; it shall define the relevant para-metres for the supervision of transactions; it shall order or provide by itself the sup-plementary clarifications as per article 17; assurances are given that the body in chargeof deciding whether the business relations pursuant to article 22, paragraph 1 shall beadmitted or continued receive the necessary information for it to make a decision»(this is the wording of the second paragraph of the provision).

46 Article 10 of the GwV EBK states as follows: «Financial intermediaries shallissue internal guidelines to counter money laundering and terrorist financing and shallinform thereof client consultants and other collaborators who may be concerned».

47 PIETH, Risikomanagement und Strafrecht, above at fn 4, p. 612.48 FORSTER, above at fn 9, p. 236; PIETH, Risikomanagement und Strafrecht, above

at fn 4, p. 614.


the light of these provisions, there was the opportunity to adoptprograms to counter bribery49 that should be essentially basedon the business code of conduct50. Therefore this should be as-sociated with an effective system of communication and infor-mation including the introduction of anonymous whistle-blow-ing51 procedures and an adequate control system52. The intro-duction of prevention rules would also imply in any case a clearand suitable distribution of competencies53.

7. Sanctions and outline of procedural law

Any offence in respect of which a business is found liableshall be punished by pecuniary sanctions, in particular a fine upto five million Franc (paragraph 1 of article 102). According todoctrine, the publication of the judgment of conviction (article68) and confiscation (articles 69-76) shall also apply54.

49 In this connection see article 3 of the Business Principles for CounteringBribery of 2002 - Transparency International.

50 Article 7 of the ICC Rules of Conduct and Recommendations states that: «inorder to prevent bribery and extortion, enterprises should implement comprehensivepolicies or codes reflecting these Rules of Conduct as well as their particular circum-stances and specific business environment. These policies or codes should: a) provideguidance and training in identifying and avoiding bribery or extortion in the dailybusiness dealings of the enterprise; b) offer confidential channels to raise concerns,seek advice or report violations without having to fear retaliation; c) include discipli-nary procedures to sanction misconduct; and d) apply to all controlled subsidiaries,foreign and domestic.»

51 See article 7 of the ICC Rules of Conduct and Recommendations and article 5.6of the Business Principles for Countering Bribery of 2002 - Transparency International.

52 See article 5.7 of the Business Principles for Countering Bribery of 2002 -Transparency International («the enterprise should establish and maintain an effectivesystem of internal controls to counter bribery…»). In this regard doctrine also makesreference to article 4 of the ICC Rules of Conduct and Recommendations.

53 Article 5.1 of the Business Principles for Countering Bribery of 2002 - Trans-parency International.

54 PERRIN, above at fn 12, p. 216; HEINE, Criminal liability of entreprises in Switzerland. A new programme: organisational deficiencies, in AA.VV., La responsabilitépénale des personnes morales en Europe, by Adam, Colette-Basecqz, Nihoul, Bruxelles,2008, p. 313 et seq.

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However, as to the applicable sanctions, the Swiss legislatorturns out to be coherent with the general system of liability be-cause pursuant to article 102 express relevance is given to or-ganisational deficiencies also when it comes to establishing theamount of pecuniary sanctions55, i.e. the judge will have to eval-uate not only the seriousness of wrongdoings but also the seri-ousness of organisational deficiencies.

Moreover the rules establishing the amount of pecuniarysanctions are inspired by special prevention principles, i.e. theapplication of sanctions shall be suitable to dissuading corpora-tions from committing new wrongdoings56. Precisely to that pur-pose, a reference to the economic capacity of businesses is alsodeemed to be indispensable57.

Moreover, the Criminal Code laid down procedural rules inarticle 102a in relation to representation of corporate entities incourt proceedings. This provision was repealed by the new SwissCode of Criminal Procedure that entered into force on 1st Janu-ary 2011 and incorporated that rule into article 112 with the fol-lowing wording: «1. In criminal proceedings against a corporateundertaking, the undertaking shall be represented by a single per-son who has unlimited authority to represent the undertaking inprivate law matters. 2. If the undertaking fails to appoint such arepresentative within a reasonable time, the director of proceedingsshall decide which of the persons authorised to represent the un-dertaking in private law matters will represent the undertaking inthe criminal proceedings. 3. If a criminal investigation is opened

55 The provision has the following wording: «Das Gericht bemisst die Busse insbesondere nach der Schwere der Tat und der Schwere des Organisationsmangels unddes angerichteten Schadens sowie nach der wirtschaftlichen Leistungsfähigkeit des Unternehmens».

56 PIETH, Die strafrechtliche Verantwortung des Unternehmens, above at fn 4,p. 367.

57 PIETH, Die strafrechtliche Verantwortung des Unternehmens, above at fn 4, p.367. For the relations between the principles laid down in article 102, paragraph 3 es-tablishing the amount of sanctions and the general principles for that same purposesee MACALUSO, above at fn 3, p. 169 et seq.


against the person representing the undertaking in the criminalproceedings in respect of the same or related circumstances, the un-dertaking must appoint another representative. If necessary, the di-rector of proceedings shall appoint another person to represent theundertaking in accordance with paragraph 2, or if no one is avail-able, a suitable third party. 4. If proceedings are brought against anatural person and an undertaking in respect of the same or re-lated circumstances, the two proceedings may be combined»58.Otherwise corporate entities are deemed to be subject to theprocedural rules in place for natural persons59.

58 English translation from http://www.admin.ch/ch/e/rs/312_0/a112.html. Theofficial German version is the following: «In einem Strafverfahren gegen ein Unternehmen wird dieses von einer einzigen Person vertreten, die uneingeschränkt zurVertretung des Unternehmens in zivilrechtlichen Angelegenheiten befugt ist. 2. Bestelltdas Unternehmen nicht innert angemessener Frist eine solche Vertretung, so bestimmtdie Verfahrensleitung, wer von den zur zivilrechtlichen Vertretung befugten Personen dasUnternehmen im Strafverfahren vertritt. 3. Wird gegen die Person, die das Unternehmenim Strafverfahren vertritt, wegen des gleichen oder eines damit zusammenhängendenSachverhalts eine Strafuntersuchung eröffnet, so hat das Unternehmen eine andereVertreterin oder einen anderen Vertreter zu bezeichnen. Nötigenfalls bestimmt die Verfahrensleitung zur Vertretung eine andere Person nach Absatz 2 oder, sofern einesolche nicht zur Verfügung steht, eine geeignete Drittperson. 4. Wird wegen des gleichenoder eines damit zusammenhängenden Sachverhalts sowohl ein Verfahren gegen eine natürliche Person wie auch ein Verfahren gegen ein Unternehmen geführt, so können dieVerfahren vereinigt werden».

59 PERRIN, above at fn 12, p. 218 et seq.

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Documents

Corporate criminal liability and organizational failure under the Swiss criminal code