The Penal Code, pursuant to Article 296a, provides for the liability of persons holding managerial positions, as well as persons employed by a specific business entity, for requesting or accepting financial or personal benefits in exchange for abusing their authority or failing to fulfill their obligations, which may cause financial damage to the entity or constitute an act of unfair competition or an impermissible preferential act in favor of the purchaser or recipient of the goods, services, or benefits. The offenses specified in Article 296a of the Penal Code are intentional and may be committed with direct or eventual intent.
Subject of protection
The subject of protection is proper, reliable, and honest economic transactions. Legislation aims primarily to guarantee honesty and a culture of entrepreneurship. It also aims to assure market participants that decisions are made carefully and based on legitimate economic interests.
Accepting financial or personal benefits, or the promise thereof, in exchange for a favorable decision for the other party may occur through abuse of granted authority or failure to fulfill an obligation incumbent on the acceptor, which may cause financial damage to the designated entity or constitute an act of unfair competition or an impermissible preferential act on behalf of the buyer or recipient of the goods, services, or benefits. These actions may result in both loss and lost profits for the entity managed by the perpetrator.
Who can respond?
The crime of bribery is an individual offense. This means that the person holding a managerial position, as well as all employees and individuals collaborating with the entity, are responsible for committing the prohibited act.
The term "managerial function" refers to individuals who, within the structure of a given organization, actually perform management duties within a specific department. Management functions are performed in particular by members of management boards of legal entities, presidents, directors, and managers, chief accountants, and heads of departments or divisions defined within internal organizational structures. These powers do not necessarily have to be derived from powers of attorney or commercial representation granted to specific employees. Liquidators and trustees also bear liability under certain circumstances.
Penalties
As a rule, the perpetrator of a prohibited act is subject to imprisonment from 3 months to 5 years. In the event of causing significant property damage, the perpetrator is subject to imprisonment from 6 months to 8 years.
The legislature also provided for a situation in which the perpetrator reported the fact to a law enforcement agency. Such a person would then not be subject to criminal liability.
How to prevent abuse in the enterprise?
People in management positions in companies, especially company boards, should pay attention to these issues within their organizations. It's worth ensuring employee training and defining boundaries in contacts with contractors.
It's also good practice to implement codes of ethics and best practices within organizations, as well as to communicate these principles not only to employees but also to contractors. Codes can define rules for accepting gifts, entertainment, meals, and travel. These activities must remain within established boundaries, and gratuities should be reasonable in value, assuming that their acceptance is not intended to influence the recipient's decisions or actions.
This article is for informational purposes only and does not constitute legal advice.
Legal status as of February 21, 2023.
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