ITALY Law and Practice Contributed by: Giorgio Vagnoni, Alessio Di Pietro, Alessandra Mosca and Cesare Placanica, LAWP Studio legale e tributario
ance and may also convict them or force them to pay monetary fines. Moreover, if witnesses use fraudulent schemes to avoid attendance, they may also be sanctioned with imprisonment, in addition to monetary fines. Any breach of the duty to truthfully answer questions gen - erates consequences of perjury and may be criminally prosecuted. 3. Corporate Entities, Ultimate Beneficial Owners and Shareholders 3.1 Imposing Liability for Fraud on a Corporate Entity Civil Liability Corporate entities may be civilly liable for autono - mous and unauthorised unlawful acts carried out by their directors and officers in the performance of their duties, especially when the company – directly or indi - rectly – benefited from those acts. In fact, according to the principle of “organic iden - tification”, directors and officers acting on behalf of their company carry out their activities as if they were the company itself. Thus, their civil liability towards a damaged claimant extends also to the company they represent. In these cases, the liability of the company is additional to the liability of the director and officer, giving rise to a source of joint and several liability. The extension of civil liability from an individual direc - tor or officer to the company may be avoided in cases where it clearly appears that the actions carried out by directors and officers do not fall within the corporate purpose of the entity and are outside the scope of the company’s interest. Corporate Criminal Liability (Legislative Decree No 231/2001) Criminal liability constitutes an exception to the afore - mentioned principle – given that it has a personal nature and therefore directly affects directors and officers, rather than the company itself. Following the introduction of Legislative Decree No 231/2001, companies and other legal entities are sub -
ject to a particular kind of liability for offences car - ried out by persons with roles of representation and management within the company, as well as officers subject to the supervision or direction of directors and other such individuals. This liability of the company is formally administrative in nature but acts mostly like criminal liability. It is autonomous and additional to the personal criminal liability of directors and officers. To validly claim the existence of corporate criminal liability, the offence must be committed “in the inter - est or to the advantage of the organisation”. If the offender acts solely and exclusively in the interests or for the advantage of themselves or third parties, the organisation is not deemed liable. The offences triggering liability of a company may include offences against public administration (ie, corruption and bribery), misrepresentation of finan - cial information, tax fraud, money laundering, cyber - crimes, and environmental crimes. To a certain extent, the company can also be held liable if offences are perpetrated outside Italian territory. If one of these offences is committed by a director or officer, the company itself is sanctioned with monetary fines, dis - qualification from carrying out certain activities, and confiscation of assets. To avoid liability, the company is required to adopt and actively implement: • a so-called Organisation, Management and Control Model (“231 Model”), which is a manual contain - ing principles and procedures to evaluate, monitor, prevent and manage the risk of offences being committed within the corporate organisation; and • a supervisory body with the duty to evaluate and monitor the observation and implementation of the 231 Model. 3.2 Claims Against Ultimate Beneficial Owners When a company is used as a vehicle for fraud, rem - edies are still available to the claimant to directly address the individuals culpable of the offence (eg, shadow directors and ultimate beneficial owners), especially in the case of limited liability companies.
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