In October 2011 the Stuttgart Public Prosecutor's Office filed an indictment against two Volkswagen employees in connection with T-Systems' sponsorship of VfL Wolfsburg football club. The employees of car manufacturer Volkswagen – the largest employer in Wolfsburg – had allegedly refused to extend the contract with Volkswagen's telecommunications provider T-Systems, unless T-Systems agreed to continue sponsorship of the town's premier league football club (for further details please see "Sponsorship and bribery in tri-party relationships"). The prosecutor's office regarded this as bribery of employees of a business, which is an offence under Section 299 of the Criminal Code. Further, the prosecutors investigated Purchase Director Francisco Javier Garcia Sanz for not intervening in the deal.
The prosecutor's office and Volkswagen agreed on a €2 million fine to be paid by Volkswagen. There will be no further court proceedings against the employees. The prosecutor's office complimented Volkswagen on changing its internal structures and training its employees after the bribery became public. The case was closed and no fine was issued against Sanz. This is an example of how compliance programmes can lead to a reduction or even a waiver of fines.
In Germany, as in most other jurisdictions, a compliance programme that has failed to prevent an infringement has no influence on a fine. The authorities, in particular the Federal Cartel Office, argue that a legal duty to operate an effective compliance programme exists. Meeting this duty alone does not justify a fine reduction. Likewise, German authorities will not increase a fine if employees have knowingly infringed the law after they have been trained through a compliance programme. Thus, when setting a fine the authorities recognise that the existence of a compliance programme during an infringement is neither an aggravating nor a mitigating factor. However, it is established practice to take into account positive post-offence conduct and this is why Volkswagen benefited from the improvement of its compliance programme. In principle, the message is clear – companies are legally obliged to operate an effective compliance programme in order to prevent infringements. If infringements occur, the compliance programme must be improved, which may lead to a reduction in fines.
For further information on this topic please contact Markus Schoner at CMS Hasche Sigle by telephone (+49 40 37 63 00), fax (+49 40 37 63 040 600) or email (firstname.lastname@example.org). The CMS Hasche Sigle website can be accessed at www.cms-hs.com.
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