Combating corruption in the private sector
The European Union (EU) combats corruption in the private sector. A harmonised definition of concepts should give more muscle to the fight against corruption, which destroys the basis of economic life and distorts competitiveness: the Union emphasises the need to prevent crime which favours a minority but is detrimental to society at large.
Council Framework Decision 2003/568/JHA of 22 July 2003 on combating corruption in the private sector.
Active and passive corruption in the private sector is a criminal offence in all Member States. Legal persons * may be held liable for such offences.
Inclusion of the concept of corruption in national criminal law
Member States are required to penalise acts intentionally carried out as part of business activities:
- Corrupting a person: by promising, offering or giving directly or through an intermediary to a person who in any capacity directs or works for a private sector entity, an undue advantage of any kind, for that person or for a third party in order that that person should perform or refrain from performing any act in breach of that person's duties *;
- Demanding an undue advantage: a person requests or receives, directly or through an intermediary, an undue advantage of any kind, or accepts the promise of such an advantage, for him or herself or for a third party, while in any capacity directing or working for a private sector entity, in order to perform or refrain from performing any act in breach of one's duties *.
The above applies to business activities within profit and non-profit making entities. Member States may limit the scope to conduct which involves or could involve a distortion of competition in relation to the purchase of goods or commercial services. Member States must declare to the Council how they are going to act at the time of the adoption of this Framework Decision. Limitations are valid for five years as from 22 July 2005. Before 22 July 2010, the Council will review declarations made by Member States in relation to limitations.
Liability of legal and natural persons
The aim of this Framework Decision is to involve the liability not only of natural persons in the capacity of employees but also of legal persons such as firms.
With regard to the liability of natural persons, Member States must ensure that the acts referred to are liable to a maximum penalty of at least one to three years' imprisonment. The right to engage in business activities may be temporarily suspended. Instigation to commit one of the acts set out above or aiding or abetting such conduct is also an offence.
Legal persons may be held liable for offences involving corruption if they are committed for their benefit by any natural person acting individually or who has a leading position within a legal person based on:
- a power of representation of the legal person;
- an authority to take decisions on behalf of the legal person;
- an authority to exercise control within the legal person.
Penalties for legal persons may include criminal or non-criminal fines. Moreover, Member States may consider exclusion from entitlement to public benefits or aid, temporary or permanent disqualification from the practice of commercial activities, etc.
Each Member State has jurisdiction if the offence has been committed:
- within its territory;
- by one of its nationals;
- for the benefit of a legal person that has its head office in the territory of that Member State.
This Framework Decision repeals Joint Action 98/742/JHA. It applies to Gibraltar. Member States must take the necessary measures to comply with the Framework Decision before 22 July 2005.
This act is affected by the judgment of the Court of Justice of the European Communities in Case C-176/03 concerning the distribution of powers in criminal matters between the European Commission and the Council of the European Union.
|Key terms used in the act|
|Act||Entry into force - Date of expiry||Deadline for transposition in the Member States||Official Journal|
|Framework Decision 2003/568/JHA||31.07.2003||22 July 2005||OJ L 192 of 31.07.2003|