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Trends and climate
Have there been any recent changes in the enforcement of anti-corruption regulations?
The most recent amendments to the Criminal Code provisions regarding the illegal abuse of a position for personal gain and bribery were:
- Law 190 of November 6 2012, which introduced and amended some definitions of offences against the public administration; and
- Law 69 of May 27 2015, which further increased the statutory penalties for these types of offence.
Are there plans for any changes to the law in this area?
At present, Parliament is discussing potential amendments to the Criminal Code provisions on the statute of limitations. If passed, these amendments will also influence bribery and the illegal abuse of a position for personal gain.
Which authorities are responsible for investigating bribery and corruption in your jurisdiction?
The Public Prosecutor’s Office is responsible for investigating bribery and corruption.
What are the key legislative and regulatory provisions relating to bribery and corruption in your jurisdiction?
The legislative provisions relating to the illegal abuse of a position for personal gain and the various types of bribery in regards to natural persons are Articles 317 to 323bis of the Criminal Code. For legal persons, the relevant provision is Article 25 of Decree-Law 321 of June 8 2001.
What international anti-corruption conventions apply in your jurisdiction?
With Law 300/2000, the government signed and ratified the Organisation for Economic Cooperation and Development Convention on Combating Bribery of Foreign Public Officials in International Business Transactions.
The government has also ratified the United Nations Convention against Corruption and the Criminal Law Convention on Corruption (which was signed in Strasbourg on January 27 1999).
Further, Italy is a member of the Working Group on Bribery – which focuses on the corruption of foreign public officials in international business transactions – and the Group of States Against Corruption working group, which was created within the European Council framework.
Specific offences and restrictions
What are the key corruption and bribery offences in your jurisdiction?
The illegal abuse of a position for personal gain is governed by Article 317 of the Criminal Code. Under this provision, it is an offence for a public official to abuse his or her position or powers by forcing another party to give or promise unduly to himself/herself or a third party money or other benefits.
Italian law prohibits various corruption-related offences, including different types of behaviour by public officials. Under Article 318 of the Criminal Law, it is an offence for a public official to receive unduly, for himself/herself or a third party, money or other benefits or a promise thereof in return for the performance of duties or powers.
Under Article 319 of the Criminal Code, it is an offence for a public official to omit or delay an act of office or make or induce another party to commit an act that is contrary to his or her office.
Under Article 322 of the Criminal Code, it is an offence for a party to unduly offer or promise money or other benefits to a public official to induce him or her to commit an act governed by the above provisions.
The following less serious offences are also governed by the Criminal Code:
- Under Article 319quarter, it is an offence for a public official to abuse his or her title or powers by inducing a party to give or promise unduly to himself/herself or a third party money or other benefits. In such cases, the party that gives or promises the money or other benefits will also be punished.
- Under Article 323, it is an offence for a public official to violate laws or regulations or fail to abstain when there is a conflict of interest regarding himself/herself or a relative (or in other specific cases) – in the performance of his or her duties or services – in order to gain financial advantages wilfully and unduly for himself/herself or other parties or bring about damages to other parties.
- Under Article 346bis, it is an offence for a party (outside the hypothesis of abetting an offence governed by Articles 319 and 319ter of the Criminal Code) to abuse unduly its relationship with a public official by forcing another party to give or promise to it or a third party money or other benefits in return for illegal mediation with the public official.
Finally, in 2012 a new corruption offence regarding directors, general managers and executives responsible for record keeping was introduced by way of Article 2635 of the Civil Code. This provision punishes persons with managerial jobs who accept money or other benefits for performing acts against their company’s interests.
Are specific restrictions in place regarding the provision of hospitality (eg, gifts, travel expenses, meals and entertainment)? If so, what are the details?
Under the Criminal Code, ‘money or other benefits’ constitute illegal compensation. However, no specific examples are provided. From a criminal point of view, judiciary and Court of Cassation decisions show that any advantage can be considered an undue advantage – be it material, moral, economic or non-economic – if it is objectively significant.
Thus, social advantages which have indirect or implied economic consequences – such as maintaining social status, performing a given job or developing specific social relationships – constitute an undue advantage.
What are the rules relating to facilitation payments?
Following a conviction or penalty imposed on request by the relevant parties in accordance with Article 444 of the Code of Criminal Procedure, Italian law provides for the mandatory confiscation of illicit payments deriving from crimes against the public administration.
The ‘price’ of a crime is what is promised to a party for committing the offence, while the ‘profit’ is any financial benefit deriving directly from the crime.
In particular, Article 322ter requires the mandatory confiscation of the profit or price of such crimes, but only if they are not owned by an uninvolved third party. In such cases, goods owned by the offender of equal value to the profit or price of the crime – or in any case no less than the money or other benefits given or promised to the public official – will be confiscated (the so-called ‘confiscation of the equivalent’ provision). For parties that induce crimes against the public administration, Article 322ter also requires the mandatory confiscation of their goods equal in value to the profit or price of the crime – or in any case no less than the money or other benefits given or promised to the public official – where such profit or price is owned by an uninvolved third party.
Scope of liability
Can both individuals and companies be held liable under anti-corruption rules in your jurisdiction?
Articles 317 onwards of the Criminal Code cover the liability of natural persons.
Further, Article 25 of Decree-Law 231/2001 states that legal persons can be held liable for crimes regarding the illegal abuse of a position for personal gain and corruption where such crimes are committed by a company’s senior management for its advantage.
Can agents or facilitating parties be held liable for bribery offences and if so, under what circumstances?
Under Article 321, parties that facilitate giving or promising money or another benefit to a public official can also be held liable and incur the same statutory penalties as the party giving or promising the money or benefit. The only exception to this rule – in terms of statutory penalties – is provided in Article 319quater of the Criminal Code, which states that, in cases of undue induction, the facilitating party will receive a reduced sentence.
Can foreign companies be prosecuted for corruption in your jurisdiction?
Foreign companies can be prosecuted for crimes committed in Italy. Pursuant to Article 6 of the Criminal Code, a crime will be considered to have been committed in Italy when the act or omission constituting the crime – in full or in part – or the event deriving from the act or omission, occurred in Italy.
Whistleblowing and self-reporting
Are whistleblowers protected in your jurisdiction?
Although Italian law is silent on this matter, Parliament is discussing a draft law specifically regarding whistleblowing. As such, changes are expected in the near future.
Is it common for leniency to be shown to organisations that self-report and/or cooperate with authorities? If so, what process must be followed?
At present, Italian law is silent on this matter.
Dispute resolution and risk management
Is it possible for anti-corruption cases to be settled before trial by means of plea bargaining or settlement agreements?
Italian law provides for a special plea bargaining procedure regarding penalties, which can be used at the request of the relevant parties. The procedure is governed by Articles 444 onwards of the Code of Criminal Procedure.
In particular, the code enables a defendant and prosecutor to ask the court to apply an alternative penalty or a fine reduced by up to one-third (as agreed). In such cases, the reduced penalty cannot exceed five years’ imprisonment. This procedure does not apply to offences that constitute crimes against the public administration.
While one of the major changes introduced by Law 69 of May 27 2015 relates to the illegal abuse of a position for personal gain and corruption, it also relates more generally to crimes against the public administration under the Criminal Code. This includes the subordination of a sentencing request for the full repayment of the price or profit of the offence. This change has therefore made it more burdensome for parties involved with such offences to access the plea bargaining procedure.
The plea bargaining procedure leads to the rapid conclusion of proceedings, as a defendant will surrender its request for the case to be judged on its merits and accept the penalty agreed with the prosecution.
The procedure’s benefits include:
- the suspended sentence;
- the non-applicability of security measures, except for confiscation pursuant to Article 240 of the Criminal Code;
- the non-applicability of additional penalties; and
- the dismissal of the elapsed offence if the defendant does not commit a similar for two to five years (depending on the offence or misdemeanour).
Finally, the defendant must pay as compensation for damage only the costs incurred in the criminal proceedings (this can be requested only in civil court proceedings).
The same procedure is available for legal persons in accordance with Article 63 of Decree-Law 231/2001.
Are any types of payment procedure exempt from liability under the corruption regulations in your jurisdiction?
Italian law provides for no such procedure.
What other defences are available and who can qualify?
At present, no other defences are available under Italian law.
What compliance procedures and policies can a company put in place to assist in the creation of safe harbours?
Decree-Law 231/2001 expressly provides a major benefit for companies and agencies regarding their liability. Under Article 6(2) of the decree, companies and agencies may be able to exclude or limit their liability for offences under the decree if they implement an organisational model and procedures that:
- identify the activities within which offences are likely to be committed;
- adopt specific protocols regarding the formation and implementation of the company’s decisions in relation to the crimes to be prevented;
- identify ways to manage financial resources that can prevent the commission of crimes and offences;
- establish a supervisory body entrusted with observing that the organisational model and procedures are followed; and
- introduce a disciplinary system for failing to comply with the measures required under the organisational model and procedures.
A number of elements of the so-called ‘Model 231’ are mandatory for a company to exclude or limit its liability under this provision, including:
- appointing a supervisory body;
- identifying and assessing the activities within which offences are likely to be committed; and
- reporting to the supervisory body.
Companies may adopt other organisational procedures and protocols independent of the requirements under the decree law.
Companies should document and formally adopt their activities regarding Model 231. Further, the organisational model must be fully operational and checked and updated periodically.
Record keeping and reporting
Record keeping and accounting
What legislation governs the requirements for record keeping and accounting in your jurisdiction?
In general, Article 2214et seq of the Civil Code regulates the maintenance of accounting records regarding business activities. Further, the code and other laws establish specific rules which apply to individual types of company (eg, limited liability companies, joint stock companies and listed companies). Examples of record-keeping offences include:
- falsifying corporate accounting records to mislead third parties (Article 2621 of the Civil Code); and
- destroying, stealing or misappropriating the accounting records of a company that has been declared bankrupt to harm creditor interests (Article 216(I) of Royal Decree 267/42).
What are the requirements for record keeping?
Under the Civil Code, accounting records must be kept according to the rules of orderly accounting (eg, with no blank spaces, line spacings or deletions) for 10 years. Accounting books must be numbered on each page and, should they need to be stamped, must be done so by the company registry office. Further, accounting books must be permanently accessible.
What are the requirements for companies regarding disclosure of potential violations of anti-corruption regulations?
Following the adoption of Decree-Law 231/2001, companies must ensure that they comply fully with the so-called ‘Model 231’ rules, which will ensure better supervision of possible violations of anti-corruption rules. This activity is generally entrusted to the company’s supervisory body, which is responsible for:
- ensuring that the organisational model is complied with and is effective;
- training and informing the company of the relevant rules; and
- updating and adapting the organisational model.
What penalties are available to the courts for violations of corruption laws by individuals?
Under the Criminal Code, imprisonment is the sole punishment available for corruption and the illegal abuse of a position for personal gain. The legal provisions adopted by judges to determine the extent of a penalty under the code were recently widened.
Without considering aggravating circumstances, a sentence between six to 12 years will be imposed for the most serious cases of:
- the illegal abuse of a position for personal gain (Article 317 of the Criminal Code);
- corruption regarding a party’s performance of an action that is contrary to its duties (Article 319 of the Criminal Code); and
- corruption in legal proceedings (Article 319ter of the Criminal Code).
A conviction for the above offences will also incur the ancillary penalty of disqualification from holding public office, which can be provisional (where certain mitigating circumstances resulted in a sentence of less than 3 years) or permanent.
While minor corruption cases regarding the conduct of duties will be punished with one to six years’ imprisonment (Article 318 of the Criminal Code), the crime of abuse of office (Article 323 of the Criminal Code) will be punished less severely with one to four years’ imprisonment.
Penalties will also be reduced in the event of induction to corruption; Article 322 of the Criminal Code provides for a one-third reduction of the statutory penalty.
In the case of all of the above offences (except an abuse of office), the payment of a sum equal to the amount unduly received by the public official by way of financial compensation in favour of the administration to which the public official belongs will be required.
Further, in cases of conviction or application of a penalty at the request of the parties, confiscation of the offender’s assets equivalent to the profit or price of the crime will be required when it is not possible to confiscate the goods representing the price or profit (Article 322ter of Criminal Code).
The ‘price’ of the crime is what is promised to a party for committing the offence, while the ‘profit’ is any financial benefit deriving directly from the crime.
Companies or organisations
What penalties are available to the courts for violations of corruption laws by companies or organisations?
With regard to legal persons, Decree-Law 231/2001 establishes that a financial penalty will apply to administrative offences totalling between €100 and €1,000. Fines range from €258 to €1,549 and are calculated on the basis of the company or organisation’s economic and financial position, in order to ensure that the penalty is effective.
Further, the decree-law provides disqualifying penalties solely for specific offences if:
- the body derived a sizable profit from the offence; or
- the offence was committed by a top person and was repeated.
Disqualifying penalties shall be imposed for between three and 24 months.
Further, Article 25 of Decree-Law 231/2001 governs the penalties for legal persons regarding corruption and the illegal abuse of a position for personal gain.