GERMANY Law and Practice Contributed by: Jan-Ove Becker and Lukas Heber, Littler
EUR50 million or a balance sheet total of more than EUR25 million; • The application of the CSRD will be post - poned by two years for companies newly subject to reporting requirements (already decided by the EU). • CSDDD due diligence obligations will be restricted with regard to indirect business partners. • There will be no civil liability for breaches of CSDDD obligations. In addition to these plans at EU level is the new government’s plan to abolish or amend the LkSG. However, whether and to what extent this will happen in view of the obligation to imple - ment the (stricter) CSDDD is in question at pre - sent. 3. Corporate Liability 3.1 Criminal and Civil Corporate Liability Criminal Corporate Liability Legal entities cannot be criminally prosecuted in Germany. German criminal law does not recog - nise corporate criminal law because legal enti - ties cannot act “culpably” , which is a mandatory prerequisite for criminal liability. However, Section 30 of the German Administra - tive Offences Act ( Ordnungswidrigkeitengesetz , OWiG) enables law enforcement authorities to impose a so-called corporate fine ( Verbandsgeld- buße ) on companies. This implies either that a member of the company’s management has violated an obligation that applies to the legal entity or that the legal entity has benefited from the act of the member of the management. Law enforcement authorities have been imposing such corporate fines with increasing frequency in recent times.
The amount of the corporate fine depends on the severity of the allegation against the member of the company’s management and the extent to which the company’s organisation facilitated the alleged act. The extent to which the com - pany benefited from the act is also decisive for the amount, as the corporate fine is intended to eliminate any unlawful economic advantages gained by the company. Section 30 OWiG is supplemented by Section 130 OWiG, which establishes an obligation on the part of the company director – ie, also the board members and managing directors, to take supervisory measures to prevent violations of duties within the company that affect the owner of the company and whose violation is punish - able by a penalty or fine. In addition, the sanctions already mentioned in 2.2.2 Corporate Human Rights Due Dili- gence Legislation and 2.2.4 Transparency and Reporting Requirements for violations of legal obligations regarding BHR should of course be mentioned in the context of criminal corporate liability. Civil Corporate Liability Although companies are not, in principle, subject to human rights under German law, but, rather, the German state is, corporate liability in tort according to the general German liability princi - ples is possible in the event of human rights vio - lations. This is because companies can be held liable under civil law if they act or fail to act in a manner that culpably infringes the life, limb, free - dom or property of others. Companies may also be liable in tort if they violate certain so-called protective laws. The prerequisite for liability is a breach of duty. In practice, this is the actual gateway to human rights due diligence obliga - tions. A breach of duty occurs when someone
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