The Austrian government programme for 2013 to 2018 provides, among others things, for an evaluation of the conditions and penalties for accounting offences. The latest ministerial draft of the 2015 Criminal Law Amendment Act proposes a reformulation of accounting offences. The new provisions in Section 163a of the Criminal Code could enter into force as early as January 1 2016.
Several acts on corporate law regulate criminal offences involving accounting fraud, including:
- Section 255 of the Stock Corporation Act;
- Section 122 of the Act on Companies with Limited Liability;
- Section 64 of the Act on the Statute for a European Company;
- Section 89 of the Cooperatives Act;
- Section 43 of the Federal Act on the Broadcasting Corporation;
- Section 41 of the Private Foundations Act;
- Section 114 of the Insurance Supervisory Act;
- Section 18 of the Demerger Act;
- Section 15 of the Capital Market Act;
- Section 189 of the 2011 Investment Fund Act; and
- Section 37 of the Real Estate Investment Fund Act.
These laws often differ from each other in detail and in terms of the applicable penalties.
In addition to harmonising the accounting offences, penalties and provisions on active repentance, the objectives of the reform include the harmonisation of accounting and corporate law definitions and restrictions on punishable offenses. Another aim is to expand the scope of the legal entities covered (eg, savings banks, large associations and certain foreign legal entities with close ties to Austria), and to include acts committed abroad in connection with legal entities resident in Austria, irrespective of the laws of the country in which the offence was committed.
A distinction has been made between acts committed by officers of a company (Section 163a of the Criminal Code – "False presentation of the assets, financial condition and results of operations of certain associations") and acts committed by external auditors (Section 163b of the Criminal Code – "False reports of auditors of certain associations").
The new provisions of the Criminal Code will replace most of the previous criminal offence elements; only the Capital Markets Act, the 2011 Investment Fund Act and Section 37 of the Real Estate Investment Fund Act will remain unchanged, since their inclusion is unfeasible due to their specific forms of perpetration and differing lists of offenders. However, these provisions will be adapted to Section 163a of the Criminal Code.
The ministerial draft also raises the thresholds for penalties for commercial criminal offences from €3,000 to €5,000 and from €50,000 to €500,000. The objective is to harmonise the applicable penalties and avoid short prison sentences in favour of fines.
For further information on this topic please contact Heidemarie Paulitsch at Schoenherr by telephone (+43 1 53 43 70) or email (firstname.lastname@example.org). The Schoenherr website can be accessed at www.schoenherr.eu.
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