Criminal law on corruption significantly tightened

Recently, legislation which has been planned for a long time with significant effect on economic life has now been formally introduced.

The Federal Cabinet approved on 21 January 2015 a draft of the Federal Ministry for Justice and Consumer Protection revising the criminal law on corruption. The core of this draft is a revision of bribery and/or the taking of bribes in business according to Sec. 299 Criminal Code. While its application has so far been quite wide, it will now be even wider. So far a criminal offence arose only if an employee or agent of a business in return for a benefit favoured another in competition, for example by the award of a contract. In future, any act in which the employer or agent breaches his obligations to the employee/principal will also be covered. Preference in competition is not necessary. What constitutes the breach remains open. In particular, in view of many compliance guidelines introduced by companies in recent years, any breach of such guidelines can rapidly constitute a breach of duty. Compliance guidelines to avoid criminality can therefore have the effect in the worst case of being the basis for criminal offence. Even a breach by the acceptance of a benefit is not, however, intended to constitute an offence as the draft clarifies expressly.

The revision of Sec. 299 Criminal Code will also lead to questions as to whether, according to the new provision, approval of the employer/principal can extinguish the criminality. In other jurisdictions which have for a long time relied on the element of bad faith as a legal value (e.g. France or Italy, but also the United Kingdom) that is the case.

In addition, the crime of bribery of officials is tightened. European officials are also included as possible recipients of bribes. This is a tightening compared to the previous legal situation under the European Bribery Act (EUBestG) since so far only official acts in breach of duty were necessary as consideration. In the international context outside Europe, the situation is also being tightened up. The requirement of cross-border benefit, i.e. a connection with international business, has been repealed.