On 4 February 2010, legislation introducing criminal liability for legal entities was passed by the Luxembourg Parliament. The new rules - which consist mostly of amendments and additions to the Luxembourg Penal Code and the Luxembourg Code of Criminal Procedure - will enter into force on 15 March 2010.
Scope of application
The new rules apply to most types of legal entities, including:
- profit-making entities constituted under private law, e.g. private limited liability companies (sociétés à responsabilité limitée), public limited liability companies (sociétés anonymes), general partnerships (sociétés en nom collectif), partnerships limited by shares (sociétés en commandite par actions), economic interest groupings and agricultural associations;
- non-profit entities constituted under private law, e.g. certain associations with legal personality and foundations;
- entities constituted under public law (subject to the exceptions given below).
The State of Luxembourg and Luxembourg municipalities are expressly excluded from the new rules. In addition, the following are excluded (because they do not possess legal personality):
- companies which are still in the process of being incorporated;
- groups of companies;
- temporary commercial associations and commercial associations not having separate legal personality.
Criminal liability on the part of a legal entity will arise whenever a crime or offence under the Luxembourg Penal Code is committed by one or more of the entity's legal representatives (e.g. a director) on behalf and for the benefit of the entity. The criminal liability of the legal entity does not preclude an individual who in fact perpetrated the relevant crime or offence from also being held criminally liable, whether as a principal or an accomplice.
The following sanctions can be imposed:
- confiscation of assets;
- exclusion from public markets (i.e. a ban on engaging in one or more commercial or professional activities);
- dissolution of the entity if it has intentionally been created for the purpose of committing the relevant ·
- crime or offence (this sanction is not applicable to public-law entities).