ENGLAND & WALES Law and Practice Contributed by: Steven Kay KC, Richard Paton-Philip, Kabir Sondhi and Lucy Kinder, 9BR Chambers
out in Tesco Supermarkets v Nattrass [1972] AC 153. Put briefly, the person must be in such a position that they are properly to be regarded as exercising the powers of the corporate and not merely acting as the corporate’s servant or agent. Generally, a corporate’s constitution and its memorandum/articles of association would define which individuals exercise the power of the corporate, but other factors could have an impact, such as seniority of the individual, dele - gation of powers and chains of command within the corporate (the “primary rules of attribution”). In addition, a corporate could only be liable for an act of the relevant individual that is within the “scope” of their office with the company. The test in Tesco Supermarkets v Nattrass has been criticised for its tendency to restrict the identification principle to a small subset of peo - ple, limiting significantly the acts and omissions for which a corporate could be held criminally liable. In Meridian Global Funds Management Asia Limited v Securities Commission [1995] 2 AC 500, the Privy Council devised further “spe - cial” rules of attribution to sit alongside the pri - mary rules. Essentially, the courts could look at the policy behind legislation to determine who, as a matter of law, should be taken to be capable of being identified with the corporate beyond those identified by the primary rules of attribution. In this way, the individuals through whom liability could attach might be expanded to a wider range of employees, servants, or agents. The question of when it is appropriate to go beyond the primary rules of attribution was addressed in St Regis Paper Co Limited [2011] EWCA Crim 2527. Despite the criticism of the test in Tesco Super - markets v Nattrass, it was affirmed as the rel - evant test in Serious Fraud Office v Barclays plc and Another [2018] EWHC 3055 (QB). In that
case, the High Court also recognised further principles that applied when considering the identification principle, including that a corpo - rate may delegate its powers and responsibilities to committees. The High Court acknowledged that the primary rules of attribution were very restrictive (perhaps disproportionately so when dealing with the operations of large corporates) but that there was always the option for further statutory offences to be created. The Section 7 Bribery Act corporate offence of failure to prevent bribery is a good example of the creation of a specific corporate “failure to prevent” offence that is not dependent on the liability of an individual “identified” with it. “Senior Manager” Modification Under the Economic Crime and Corporate Transparency Act 2023 Whilst the identification principle has survived recent calls for reform, it has been modified recently by Section 196 of the Economic Crime and Corporate Transparency Act 2023, that provides if a “senior manager” of a corporate acting with the actual or apparent scope of their authority commits a relevant offence, the corporate is also guilty of the offence. This cur - rently only applies to a specific list of economic crimes, but that list includes several offences that may be used to prosecute types of corrup - tion, such as cheating the public revenue, theft, false accounting, money laundering, fraud, and bribery (Sections 1, 2 and 6). Relationship Between Corporate Criminal Liability and Liability of Individuals Subject to the rules outlined above, a corporate can be prosecuted alongside individuals for the same offence. A corporate can be prosecuted alongside its own directors, even if those direc - tors are the directing wills and minds through
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