Corporate offences (delitos societarios) in Spain: what they are, forms and penalties

Corporate offences (delitos societarios) are conduct that affects the proper and transparent functioning of a company, the rights of its members or the activity of certain supervisory bodies. They are mainly governed by Articles 290 to 297 of the Spanish Criminal Code.

Not every breach of company law amounts to a criminal offence. For criminal liability to arise, the specific elements laid down for each offence must be present. Where the dispute is purely a matter of company law, challenging resolutions, bringing claims against directors or seeking damages may be more appropriate.

Which entities count as a company for the purposes of corporate offences?

The criminal-law concept is broad. It includes commercial companies, cooperatives, savings banks, mutual societies, foundations, financial or credit institutions and other entities of a similar nature that participate in the market on a permanent basis. This is laid down in Art. 297 of the Criminal Code.

Criminal-law protection extends both to companies already incorporated and to companies in the course of formation.

Falsification of company accounts or documents (Art. 290 of the Criminal Code)

Art. 290 of the Criminal Code punishes de facto or de jure directors who falsify the annual accounts or other documents that must reflect the legal or financial position of the entity, where the falsification is capable of causing financial loss to the company, to a member or to a third party.

The conduct may consist of entering false data, altering true data or concealing relevant information. The offence is not limited to the annual accounts: it may also concern other corporate documents that must give a reliable picture of the entity’s financial or legal position.

There are two forms:

• If the falsification is capable of causing the loss but the loss does not occur, the penalty is imprisonment of one to three years and a fine of six to twelve months (day-fine system).
• If financial loss actually occurs, the penalties are imposed in their upper half.

For example, this offence may be committed if a director presents accounts that knowingly conceal significant losses, overdue debts or an outflow of the company’s assets, leading a member or a third party to take financial decisions on the basis of a picture of the company’s assets that is not real.

Imposition of abusive resolutions by the majority (Art. 291 of the Criminal Code)

Art. 291 of the Criminal Code punishes those who, taking advantage of their majority position in the general meeting of shareholders or on the board of directors, impose abusive resolutions.

Three circumstances must be present:

• there is a majority position;
• the resolution is imposed for one’s own benefit or that of a third party and to the detriment of the other members; and
• the resolution brings no benefit to the company.

The profit motive may consist either of obtaining a direct advantage or of benefiting a related person or entity.

The penalty is imprisonment of six months to three years or a fine of one to three times the benefit obtained.

An example would be the majority approving a transaction that uses company assets to secure a personal debt of the majority shareholder, with no business purpose and to the detriment of the minority shareholders.

The mere existence of a resolution that is unfavourable to a member is not enough. Criminal proceedings require the resolution to be abusive and require intent to profit and the absence of any benefit to the company. Other irregular resolutions may be challenged before the commercial courts without amounting to an offence.

Harmful resolutions adopted by means of a fictitious majority (Art. 292 of the Criminal Code)

Art. 292 of the Criminal Code punishes imposing, or taking advantage of, a resolution that is harmful to the company or to any of its members where it has been adopted by means of a fictitious majority.

The majority may be fictitious, among other cases, as a result of:

• abuse of a blank signature;
• wrongly attributing voting rights to someone who does not hold them;
• unlawfully preventing someone who is entitled to vote from doing so; or
• any similar procedure.

The penalty is the same as for abusive resolutions: imprisonment of six months to three years or a fine of one to three times the benefit obtained. In addition, if the facts constitute another offence, the rules applicable to that offence may also apply.

For example, this offence could arise if it is recorded that a member voted in favour of a capital increase by improperly using a document signed in blank, or if a member entitled to vote is prevented from doing so in order to create the appearance of a non-existent majority.

Obstruction of members’ rights (Art. 293 of the Criminal Code)

Art. 293 of the Criminal Code punishes de facto or de jure directors who, without legal grounds, deny or prevent a member from exercising any of the following rights:

• to receive information;

• to take part in the management of the company;

• to monitor the company’s activity; or

• to exercise pre-emption rights to subscribe for shares.

The penalty is a fine of six to twelve months.

The criminally relevant conduct must amount to a real denial or obstruction of the right granted to the member. Not every delay, formal shortcoming or disagreement over the scope of the information requested is an offence. Criminal law is reserved for cases of manifest obstruction without legal grounds.

For example, criminal liability may arise if a director deliberately and systematically withholds the documents a member needs to understand the company’s financial position, or prevents, without justification, the member from taking part in a general meeting or in a corporate decision in which the law gives them that right.

Obstruction of supervisors or inspectors (Art. 294 of the Criminal Code)

Art. 294 of the Criminal Code applies to de facto or de jure directors of companies that are subject to administrative supervision or that operate in markets subject to such supervision.

The offence consists of refusing or preventing the action of inspecting or supervisory persons, bodies or entities. The penalty is imprisonment of six months to three years or a fine of twelve to twenty-four months.

In addition, the court may order certain measures applicable to entities or businesses under Art. 129 of the Criminal Code.

The conduct may consist, for example, of concealing essential documents, preventing access to premises or knowingly blocking an inspection lawfully ordered.

A mere disagreement with the supervisor or a challenge to an administrative act does not in itself amount to this offence. What matters is that there is an effective refusal or obstruction of the inspection or supervision.

Is the company criminally liable for a corporate offence?

The corporate offences in Articles 290 to 294 do not expressly provide for autonomous criminal liability of the legal person (company). Accordingly, the company is not criminally liable merely because one of its directors commits a corporate offence.

Criminal liability falls, in principle, on the natural person involved in the facts, including de facto directors, even if they are not formally registered as directors. The formal title of the position does not exclude the liability of whoever actually performs management or control functions.

The company may, however, be affected by other consequences: loss of assets, nullity or challenge of resolutions, claims by members, directors’ liability, reputational damage, administrative penalties or civil liability arising from the facts.

Civil liability and other consequences

Committing an offence gives rise to an obligation to make good the loss and damage caused. Art. 109 of the Criminal Code allows that liability to be claimed within the criminal proceedings or before the civil courts.

Compensation must be directly related to the proven loss and may include, depending on the case, restitution of property, reparation of the damage and compensation for proven financial loss. In corporate offences, the injured party may be the company itself, one or more members or a third party.

Parallel or alternative company-law actions may also be brought, such as challenging corporate resolutions, bringing claims against directors or recovering sums wrongly received.

A criminal conviction does not automatically replace all these actions, particularly where a corporate resolution needs to be set aside or the internal relationships within the company need to be restored.

How is a corporate offence reported?

As a general rule, corporate offences can only be prosecuted following a complaint by the aggrieved person or their legal representative. However, no such complaint is required where the facts affect general interests or a plurality of persons, under Art. 296 of the Criminal Code.

Preparing the complaint requires preserving the relevant corporate documents:

• accounts, books and minutes;
• notices of meetings and certificates;
• communications between members and requests for information;
• contracts and accounting reports; and
• any evidence of how the resolutions were adopted or implemented.

Conclusion

Corporate offences protect the transparency of corporate information, members’ basic rights, the legitimate formation of majorities and the effectiveness of administrative supervision.

A poor business decision, a disagreement between members or an irregularity under company law is not enough for an offence to exist: it must be proven that the conduct fits specifically within one of the criminal offences and meets its subjective and objective requirements.

Frequently asked questions