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The topic of "compliance" is no longer a foreign concept in many German companies. However, not every medium-sized company has it on its agenda to ensure that its own company is prepared for the consequences of legal violations when doing business across national borders. There is more reason than ever to be aware of this, especially since criminal liability has already been assumed for compliance officers for the omission of criminal offenses by company employees (as ruled by the Federal Court of Justice in 2009).

Even if some managers previously thought that certain special expenses in some countries were unavoidable if they wanted to achieve economic success, and that the envelope under the table should not be weighed on golden scales because it did not take place in Germany, the reach of various laws is greater than many people realize. According to Art. 1 § 1 I, § 2 No. 1 lit. a of the European Bribery Act (EUBestG), the laws against bribery also apply to acts committed abroad if the perpetrator is German. This applies both in business transactions (bribery of a company director, e.g. in France, in order to obtain a specific contract) and to the bribery of public officials (e.g. black suitcases for officials in Russia in order to obtain or expedite necessary administrative procedures).

But perhaps it is not a question of transferring money, but of coordinating with international competitors, and suddenly EU Commission officials are at the door to search for evidence of antitrust violations. A seemingly collegial exchange about what is planned for future pricing can suddenly become extremely costly for the company back home.

In order not to leave such developments or their prevention to chance, it is advisable to install a compliance system in the company or even in the group.

Unlike various other legal systems, German law does not recognize direct corporate criminal liability. However, if a company fails to take the necessary supervisory measures, it can also be held liable for the actions of its employees, Sections 30 and 130 of the German Administrative Offenses Act (OwiG). In addition, there are liability risks for the responsible bodies of the company and, under certain circumstances, for the compliance officers.

Companies with business relationships and, in particular, with a branch in the United Kingdom must pay particular attention to the strict UK Bribery Act 2010, a law designed to combat corruption. This Act also provides for strict liability on the part of the company.

For activities in the US, the FCPA (US Foreign Corrupt Practices Act) applies, which applies to US companies worldwide and to foreign companies for acts committed on US territory. This includes, for example, money transfers via an American account or actions carried out by sending an email to recipients in the US. In addition, US export control law may also apply, including in the case of re-exports.

Further special features in the jurisdictions in which the company operates and/or has assets must be taken into account.

Not only in relation to antitrust authorities, but also with regard to the consequences of, for example, the UK Bribery Act or the FCPA, it can be a great advantage to be able to prove that the company has a compliance system in place. However, simply installing a formal system without professional assurance of its effectiveness is not sufficient (e.g., for antitrust authorities). It should be possible for whistleblowers to report misconduct anonymously to a responsible person, and there should be effective monitoring of employees, particularly in areas that are susceptible to antitrust violations or bribery and corruption (e.g., the four-eyes principle). corruption (dual control principle, etc.). Ensuring that employees are made aware of these issues and that the effectiveness of the system is documented in an appropriate matrix within the company is by no means a trivial matter. It is advisable to seek professional advice on setting up a compliance system, particularly with regard to international business.

If you require advice on compliance systems, our criminal law experts led by Markus Schmuck, attorney at law and specialist in criminal law, and the author of this article, Dr. Markus Peter, attorney at law, specialist in international business law and former public prosecutor, will be happy to assist you.

Please also visit our page for general information on compliance.

Lawyer Markus Schmuck