Criminal Lawyers for Corporate Criminal Liability
Defense of companies and legal entities facing criminal prosecution.
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Corporate criminal liability is an institution of Spanish criminal law introduced by Organic Law 5/2010 and deeply reformed by Organic Law 1/2015, set out in Articles 31 bis to 31 quinquies of the Criminal Code (CP). It allows companies, foundations, associations and other entities with legal personality to be charged and convicted as perpetrators of offences committed in their name or on their behalf by their representatives, directors, employees or persons under their control. It is one of the most relevant areas of modern economic and corporate criminal law.
Legal Framework: Article 31 bis CP
Article 31 bis 1 CP establishes two routes for attributing liability to the legal entity: (a) for offences committed in its name or on its behalf and for its direct or indirect benefit by its legal representatives or by those who, acting individually or as part of a body of the legal entity, are authorised to take decisions on its behalf or hold powers of organisation and control; and (b) for offences committed in the exercise of corporate activities and for the direct or indirect benefit of the entity by those who, being under the authority of the former, were able to commit the acts because the former seriously breached their duties of supervision, monitoring and control given the specific circumstances of the case.
Catalogue of Offences
Corporate criminal liability operates only in respect of the offences expressly provided for in the Criminal Code: fraud and other property offences, money laundering, terrorist financing, offences against workers' rights, environmental offences, offences against public health, offences against the market and consumers, offences against the Treasury and Social Security, bribery and influence peddling, and offences relating to prostitution and the corruption of minors, among others. The list is exhaustive and has been progressively widened in successive reforms.
Applicable Sanctions
Article 33.7 CP lists the penalties applicable to legal entities: a fine (by day-fine or proportional); dissolution of the entity; suspension of activities for up to 5 years; closure of premises and establishments for up to 5 years; a prohibition on carrying out the activities in whose exercise the offence was committed; ineligibility for subsidies and public aid, for contracting with the public sector and for tax benefits for up to 15 years; and judicial intervention to safeguard the rights of workers or creditors.
Criminal Compliance as Exemption
Article 31 bis 2 CP provides that the legal entity will be exempt from liability where the following conditions are met: (1) the management body adopted and effectively implemented, before the offence, organisation and management models that include the monitoring and control measures suitable to prevent offences of the same nature; (2) supervision of the operation and observance of the model was entrusted to a body with autonomous powers; (3) the individual perpetrators committed the offence by fraudulently circumventing the models; and (4) there was no omission or insufficient exercise of the supervisory functions. Effective criminal compliance is therefore the core legal defence tool.
Specific Mitigating Factors (Art. 31 quater CP)
Article 31 quater CP lists specific mitigating circumstances for the legal entity: (a) confession before knowing that proceedings are directed against it; (b) cooperation by providing new and decisive evidence; (c) repairing or reducing the harm; and (d) implementing effective prevention models after the offence but before trial. These factors can significantly reduce the sanctions and are a frequent focus of strategic defence.
Corporate Defence Strategy
We build the corporate defence around: an analysis of the criminal-compliance model in place at the time of the events; a discussion of its actual suitability and application; verification of the attribution requirements of Article 31 bis CP (benefit to the company, perpetration by a person with a qualified link); the production of exhaustive documentary evidence on the operation of the model; cooperation with the proceedings on terms that activate the mitigating factors; defence against precautionary measures (judicial intervention, suspension of activities); and coordination with the directors' defence. We also advise on the implementation of compliance models in line with the technical standards (UNE 19601, ISO 37001). We act before the Investigating Courts, the Criminal Courts, the Provincial Courts, the Central Investigating Courts and the National High Court.
Penalties & Consequences: Corporate Criminal Liability
| Type / Scenario | Criminal Penalty |
|---|---|
| Fine (Art. 33.7 CP) | A day-fine or proportional fine — potentially several times the benefit obtained from the offence. |
| Suspension, closure or dissolution | Suspension of activities or closure of premises (up to 5 years); dissolution in the most serious cases. |
| Disqualification & judicial intervention | Ineligibility for public contracts, subsidies and tax benefits (up to 15 years); judicial intervention to protect workers and creditors. |
* Penalties shown are indicative. The actual penalty depends on case circumstances, applicable mitigating and aggravating factors.
Defense Strategy: Corporate Criminal Liability
Compliance as Exemption
Demonstrating an effective compliance model in place before the offence (Art. 31 bis 2 CP), which can fully exempt the company.<h3>Requirements of an effective compliance model (Art. 31 bis 5 CP)</h3><p>For an organisational and management model to trigger its exempting or mitigating effect, having a document is not enough: Article 31 bis 5 of the Spanish Criminal Code requires the programme to meet, in a demonstrable way, six substantive conditions. First, it must identify the activities in whose context the offences to be prevented may be committed, that is, a genuine criminal-risk map tailored to the entity rather than a generic template. Second, it must establish protocols or procedures that set out how the legal person forms its will and how decisions are taken and carried out in those sensitive areas.</p><p>Third, it must provide for financial-resource management models suitable to prevent the commission of the offences, controlling the money flows that often serve as a channel for unlawful conduct. Fourth, it must impose a duty to report possible risks and breaches to the body charged with monitoring the model, which translates into an operational reporting channel. Fifth, it must include a disciplinary system that adequately penalises breaches of the measures. And sixth, it must periodically verify the model and amend it when relevant breaches come to light or when the organisation, the control structure or the activity changes.</p><p>Effectiveness is measured not merely by the formal existence of these six elements, but by whether the programme is actually implemented and works in the company's day-to-day reality. A model adopted after the offence became known, or one that exists but is never applied, does not produce the exonerating effect. The design must therefore be accompanied by training, documentary traceability, evidence that the channel and the disciplinary regime are working, and dated periodic reviews. Our firm helps build and audit these elements so that the model can withstand criminal scrutiny.</p><h3>The autonomous oversight body and the compliance officer</h3><p>Article 31 bis 2 CP makes the exemption for offences committed by directors or representatives conditional on supervision, monitoring and control of the model having been entrusted to a body of the legal person with autonomous powers of initiative and control. That autonomy is the heart of the system: the compliance body, usually embodied in a compliance officer or a compliance committee, must be able to act independently of those who carry out the business decisions it is meant to oversee, with direct access to the highest management body and sufficient resources to perform its function.</p><p>The law allows that, in small legal persons, those supervisory functions may be assumed directly by the management body, given their lesser complexity. In other entities it is advisable to give the body a statute guaranteeing its independence, its permanence, the impossibility of removing it arbitrarily and its own budget. The mere nominal appointment of an officer, with no means or real capacity to act, weakens the model and makes it harder for the court to find that the exemption applies.</p><p>In practice, the oversight body manages the risk map, receives and processes communications from the reporting channel, proposes corrective measures, supervises training and documents its activity so that it can later prove the model was working. We advise on designing this autonomy statute, on separating its functions from ordinary legal advice and on preserving evidence, because the entity's ability to successfully invoke the exemption, or in the alternative the mitigation under Article 31 quater CP, largely depends on the body's robustness.</p><h3>The burden of proving the exemption and the legal person's plea agreement</h3><p>In forensic practice, proving that the conditions of Articles 31 bis 2 to 5 CP are met falls on the defence of the legal person invoking the exemption, without prejudice to the prosecution having to prove the underlying elements of liability. This means the entity must produce the model, its adoption date prior to the offence, evidence of its actual implementation and the functioning of the oversight body. The programme's effectiveness is argued as a question of fact assessed by the court, so orderly, verifiable documentation is decisive for the defence to succeed.</p><p>The investigated legal person has its own procedural status: it is charged autonomously, appoints its own lawyer and court agent, gives evidence through a representative specially appointed for the proceedings and enjoys the rights of defence, the right not to incriminate itself and the presumption of innocence, just like any other accused. It is advisable to ensure that this representative is not the same individual who is also under investigation, to prevent conflicts of interest that would compromise the company's defence strategy.</p><p>The entity may reach its own plea agreement, distinct from that of the individuals, negotiating the penalty within the catalogue of Article 33.7 CP and taking advantage, where applicable, of the mitigating factors in Article 31 quater (confession, cooperation by providing evidence, repair of the harm, or putting in place effective measures to prevent and detect offences before trial). We design the legal person's procedural strategy in a way that is coordinated with, yet independent of, that of its directors, to protect both the company's interests and its right to its own defence.</p><h3>Article 33.7 CP penalties, successor liability in M&A and internal investigations</h3><p>The criminal consequences for the legal person are those of Article 33.7 CP, all classified as serious: a fine assessed by daily quotas or proportionally; dissolution of the entity, the most severe sanction; suspension of activities for a term that may not exceed five years; closure of premises and establishments for up to five years; a ban on carrying out in the future the activities in whose exercise the offence was committed, favoured or concealed; disqualification from obtaining public subsidies and aid, from contracting with the public sector and from enjoying tax or social-security benefits and incentives; and judicial intervention to safeguard the rights of workers or creditors. How these penalties are calibrated is governed by Article 66 bis CP.</p><p>The liability of the legal person is autonomous from that of the individual (Article 31 ter CP): the entity may be liable even where the specific individual who committed the offence has not been identified or proceedings cannot be brought against them. Moreover, under Article 130.2 CP, that liability is not extinguished by the transformation, merger, takeover or division of the company; it passes to the resulting entity, and the judge may calibrate the penalty in light of economic continuity and substantial identity. Criminal due diligence is therefore now an unavoidable element in any acquisition or corporate restructuring.</p><p>Internal investigations are a key tool for detecting and reacting to possible offences, but their evidential lawfulness depends on respecting the rights of the affected employees: information about the subject of the investigation, a caution against self-incrimination where appropriate, proportionality in accessing corporate communications and devices, and respect for privacy and data protection. Law 2/2023 on the protection of persons who report breaches further requires an internal reporting system with guarantees of confidentiality and a prohibition of reprisals. We support the company in designing internal-investigation protocols and channels compliant with that law, so that findings are usable and the entity can demonstrate the effectiveness of its model.</p>
Offence Against the Company
Proving the offence was committed against the company's interests, not for its direct or indirect benefit.
Circumvention of Controls
Establishing that the individual fraudulently circumvented the company's control measures.
Cooperation & Repair
Activating the Art. 31 quater mitigating factors through confession, cooperation and reparation.
Economic Criminal Law in Spain: Tax Fraud, Money Laundering and Corporate Crimes
Economic criminal law encompasses the most severe financial penalties in the Spanish Criminal Code. Tax fraud over €120,000 (Art. 305 CP), money laundering (Art. 301 CP), and corporate crimes (Art. 290-297 CP) are complex offenses where defense requires a combination of criminal law expertise and deep accounting/financial knowledge.
Penalty Comparison: Economic Offenses
| Offense | Threshold | Penalty |
|---|---|---|
| Tax Fraud (Art. 305) | >€120,000 | 1 – 5 years + fine x6 |
| Aggravated Tax Fraud | >€600,000 | 2 – 6 years |
| Money Laundering (Art. 301) | Any amount | 6 months – 6 years |
| Aggravated Laundering | Organized/financial system | Up to 9 years |
| Corporate Crime (Art. 290) | Balance sheet falsification | 1 – 3 years |
| Punishable Insolvency (Art. 259) | Fraudulent bankruptcy | 1 – 4 years |
Key Defense Strategies
Tax Regularization Defense (Art. 305.4 CP)
Pay the full tax debt before charges are formally filed and the crime is extinguished. This is the most powerful complete defense in tax fraud cases.
Challenge the €120K Threshold
The tax authority's calculation method is often contestable. Independent forensic accounting can challenge the assessed figure below the criminal threshold.
Money Laundering 'Self-laundering' Issues
Spanish courts have debated whether the primary offender can also be convicted of laundering their own proceeds. Challenge the double jeopardy implications.
Corporate Crime: Harm to Company vs. Shareholders
Art. 295 corporate crimes require actual financial harm to the company or its members. Demonstrate that any loss was speculative or absent.
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