Article 31 bis Spanish Criminal Code: Criminal liability of legal persons

1. In the cases provided for in this Code, legal persons shall be criminally liable:

a) For the offences committed in their name or on their behalf, and for their direct or indirect benefit, by their legal representatives or by those who, acting individually or as members of a body of the legal person, are authorised to take decisions in the name of the legal person or hold powers of organisation and control within it.

b) For the offences committed, in the exercise of corporate activities and on behalf and for the direct or indirect benefit of the legal person, by those who, being subject to the authority of the natural persons mentioned in the preceding subparagraph, were able to carry out the acts because the latter seriously breached the duties of supervision, monitoring and control of their activity, having regard to the specific circumstances of the case.

2. Where the offence is committed by the persons indicated in subparagraph (a) of the preceding paragraph, the legal person shall be exempt from liability if the following conditions are met:

1. the administrative body has adopted and effectively implemented, before the commission of the offence, organisation and management models which include the monitoring and control measures suitable for preventing offences of the same nature or for significantly reducing the risk of their commission;

2. the supervision of the operation of and compliance with the prevention model implemented has been entrusted to a body of the legal person with autonomous powers of initiative and control, or which is legally charged with the function of supervising the effectiveness of the internal controls of the legal person;

3. the individual perpetrators committed the offence by fraudulently evading the organisation and prevention models; and

4. there has been no omission or insufficient exercise of the functions of supervision, monitoring and control by the body referred to in condition 2.

In cases in which the foregoing circumstances can be established only in part, that circumstance shall be assessed for the purposes of mitigation of the penalty.

3. In legal persons of small dimensions, the functions of supervision referred to in condition 2 of paragraph 2 may be assumed directly by the administrative body. For these purposes, legal persons of small dimensions are those which, under the applicable legislation, are authorised to present an abridged profit and loss account.

4. Where the offence is committed by the persons indicated in subparagraph (b) of paragraph 1, the legal person shall be exempt from liability if, before the commission of the offence, it has adopted and effectively implemented an organisation and management model which is adequate to prevent offences of the nature of that which was committed or to reduce significantly the risk of its commission.

In this case the mitigation provided for in the second subparagraph of paragraph 2 of this article shall likewise be applicable.

5. The organisation and management models referred to in condition 1 of paragraph 2 and in the preceding paragraph must meet the following requirements:

1. They shall identify the activities within the scope of which the offences to be prevented may be committed.

2. They shall establish the protocols or procedures which give specific effect to the process of formation of the will of the legal person, of the adoption of decisions and of their execution in relation to those activities.

3. They shall provide for models of management of financial resources which are adequate to prevent the commission of the offences to be prevented.

4. They shall impose the obligation to report possible risks and instances of non compliance to the body charged with monitoring the operation of and compliance with the prevention model.

5. They shall establish a disciplinary system which adequately penalises non compliance with the measures laid down by the model.

6. They shall carry out a periodic verification of the model and of its possible modification where relevant infringements of its provisions come to light, or where changes occur in the organisation, in the control structure or in the activity carried out which make such modification necessary.

Working translation prepared by Société Juridique from the consolidated Spanish text published by the Official State Gazette. It has no official status: the only authoritative version is the Spanish original, available at the Official State Gazette and reproduced verbatim in our Spanish-language entry for this provision. Source: Organic Law 10/1995 of 23 November, the Spanish Criminal Code.