The amendment to the Commercial Companies Code, which entered into force on 9 February 2022, has led to another extension of the criminal liability of management board members, proxies and other persons employed in the company under civil law contracts who perform activities related to the preparation and collection of documentation and reports regarding the company's activities.
From now on, the Commercial Companies Code penalises failure to comply with the information obligation, which primarily involves providing the supervisory board, upon request, with any information, documents, reports or explanations concerning the company, in particular its activities or assets.
An obligated person who, at the request of the supervisory board, fails to provide information, documents, reports or explanations within the specified time limit or provides them in a manner inconsistent with the factual circumstances, or conceals data that significantly affects the content of such information, documents, reports or explanations must be subject to severe criminal liability.
a fine of no less than 20,000 and no more than 50,000 for this type of offense , and in more serious cases, a restriction of liberty. Interestingly, the wording of this provision does not provide for exculpatory circumstances. A violation of the reporting obligation will always result in at least a fine.
negligence by the perpetrator will not exclude criminal liability, but it will influence the sentencing. A perpetrator who acts negligently will face a fine of no less than 6,000 and may reach up to 20,000 .
Only persons on whom the Commercial Companies Code imposes an obligation to provide information will be liable for this offence, primarily:
• members of the management board
• directors in a simple joint-stock company
• persons employed in the company under an employment contract or regularly performing specific activities for the company under a contract for specific work, a contract of mandate or another contract of a similar nature
• procurators
Failure to provide information, documents, reports or explanations within the deadline (two weeks, unless the supervisory board has set a longer deadline) or providing them in a manner inconsistent with the factual circumstances, or withholding data that significantly affects the content of such information, documents, reports or explanations, will be punishable.
Most importantly, a final conviction for this offense will result in the convicted person being barred from serving as a member of the management board, supervisory board, audit committee, liquidator, or commercial proxy for a period of five years from the date the judgment becomes final. A conviction will also require the person to resign from their current position.
This provision will improve the effectiveness of implementing requests submitted by the supervisory board. The introduction of this provision was a result of the limited effectiveness of the sanctions currently in force, which simply proved insufficient.
This article is for informational purposes only and does not constitute legal advice.
Legal status as of November 30, 2022.
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