THE SPANISH SUPREME COURT OPTS FOR THE COMPLIANCE

The Supreme Court, in its judgement dated June 28th 2018 with number 2036/2017, made an important reference to the compliance figure under a business context of criminal offense due to unfair administration and misappropriation in which an administrator was sentenced to prison for a period of 4 years.

The aggrieved company, Carbuastur S.L. (now Energy Fuel Asturias S.L.), counted with two joint and several administrators, one of which committed various management wrongdoings, such as making free use of cash, bank transfers to his personal bank account without justification, or standing orders at the company’s bank account of his personal expenses; the latter without consent by the second administrator.

In this sense, Vicente Magro Salvet, the judge appointed as rapporteur, pointed out the wide range of possibilities for the administrators to act due to being entitled to manage the company. In the same line, he announced as the main boundary to such freedom of management, and at the same time as an indicator of good practice, the English figure of the compliance programme.

 The compliance programmes, as mentioned in the judgement, have helped with restructuring the good corporate governance of the companies by mean of implementing protocols of good management. Said protocols consist of a set of provisions of internal nature which are established in the company on the administrative body initiative, with the aim of applying a model of organisation and management which is to be efficient enough to mitigate the risk of committing offences and, as the case may be, exonerate the company from the criminal liability derived from such offences.

Therefore, the Supreme Court highlights the importance of the implementation of the compliance programmes since the administrators are bound by such programme to act under concrete standards, which leads to the existence of a necessary control on the management activity. By doing so, the transfer of criminal liability to the company due to criminal offences ad extra would be avoided, in case the legal requirements are met, and similarly, the risk of committing criminal offences ad intra, such as misappropriation and unfair administration by the company’s own employees and positions, would be mitigated. According to the Supreme Court, the referred compliance programmes allow hindering the commission of crimes like the ones committed in the present case by the company’s administrators who did not report back to the shareholders or other joint and several administrators, committing wrongdoings that, in some cases, as the ones occurred here, are criminal offences.

In conclusion, together with the rest of benefits the company have with an efficient compliance programme, it is highlighted the benefit of offering an additional guarantee to the shareholders and to the company itself against their administrators’ unlawful or unfair acts.

Authors: Alexandru Lazar/ Miriam Santin


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