Criminal Liability of Legal Persons in France

The Principle of Criminal Liability of Legal Persons

Article 121-2 of the Code pénal establishes the criminal liability of legal persons (personnes morales) in France. Introduced by the reform of the Penal Code in 1994, this provision marked a fundamental shift in French criminal law, which had previously been based on the principle that only natural persons could commit criminal offences. Article 121-2 provides that legal persons — including private companies, public establishments, associations, and trade unions — are criminally liable for offences committed on their behalf by their organs or representatives.

The scope of corporate criminal liability has been progressively expanded through legislative reforms. Originally limited to offences specifically providing for corporate liability, the Loi Perben II (Law No. 2004-204 of 9 March 2004) generalised the regime, making legal persons liable for all offences unless the law expressly excludes them. The liability of the legal person does not exclude that of the natural persons who committed or participated in the offence; both may be prosecuted concurrently.

The Principe de Spécialité

The principe de spécialité (principle of speciality) governs the capacity of legal persons. Under this principle, a legal person may be held criminally liable only within the limits of its corporate purpose and the powers of its organs. The offence must have been committed on behalf of the legal person ("pour le compte") by its organs or representatives. This requirement links the criminal conduct to the organisational structure of the corporation.

French courts have given an expansive interpretation to the concept of “organs or representatives,” including not only statutory directors and managers but also any person with actual decision-making authority delegated by the corporate leadership. In Crim. 20 June 2006, No. 05-85.667, the Cour de cassation held that a middle manager could be a “representative” of the legal person for the purposes of Article 121-2 where he had been delegated authority to take decisions in a specific area. The court has also held that the legal person may be liable for omissions where its organs failed to take necessary preventive measures.

Environmental and Health Safety (EHS) Cases

Corporate criminal liability has been particularly significant in the environmental and health safety contexts. The Affaire AZF (2001 explosion at the Toulouse chemical plant) and the Affaire du Mediator (health scandal involving a diabetes drug) illustrate the application of Article 121-2 to major corporate disasters. In Crim. 24 September 2019, No. 18-82.815, the Cour de cassation upheld the conviction of a pharmaceutical company for manslaughter (homicide involontaire) and aggravated deception (tromperie aggravée), holding that the company’s failure to conduct adequate safety testing constituted a fault (faute) attributable to its management organs.

The French approach to corporate liability in EHS cases emphasises organisational fault (faute d’organisation). A legal person may be held liable where its internal structures, procedures, or culture created the conditions for the offence, even where no single individual can be identified as having committed a culpable act. This organisational theory of liability has been applied in cases involving industrial accidents, product safety failures, and environmental damage.

Penalties Applicable to Legal Persons

Article 131-37 et seq. of the Code pénal prescribe specific penalties for legal persons. The principal penalty is a fine, the maximum amount of which is five times the statutory maximum applicable to natural persons for the same offence (Article 131-38). For certain offences, the court may impose alternative or complementary penalties, including: dissolution (for serious offences or where the legal person was created to commit the offence); temporary or permanent prohibition from carrying on business activity; closure of establishments; placement under judicial supervision; exclusion from public contracts; prohibition from making public offerings; confiscation of assets; publication of the decision; and mandatory implementation of a compliance programme.

Dissolution is the most severe penalty and is reserved for cases where the legal person was created for the purpose of committing criminal offences or where the offence involved a serious violation of the law resulting in a conviction of the legal person to a custodial sentence for a natural person. Judicial supervision allows the court to appoint a mandataire de justice to oversee the legal person’s compliance with court-ordered measures.

Compliance Programmes and the CJIP

French law does not generally recognise compliance programmes as a defence to criminal liability. However, the convention judiciaire d’intérêt public (CJIP), introduced by the Loi Sapin 2 (Law No. 2016-1691 of 9 December 2016) and amended by the Loi relative à la transparence, à la lutte contre la corruption et à la modernisation de la vie économique, provides a deferred prosecution mechanism for legal persons accused of corruption, influence peddling, money laundering, and related offences.

The CJIP is negotiated between the prosecutor (Parquet National Financier, PNF) and the legal person, and must be approved by the president of the Tribunal judiciaire. The agreement typically requires the payment of a fine (amende d’intérêt public) and the implementation of a compliance programme under the supervision of the Agence Française Anticorruption (AFA). The CJIP avoids a criminal conviction and prevents the collateral consequences of a guilty finding. In Decision No. 17-86.607 (2020), the Cour de cassation affirmed the validity of the CJIP mechanism, rejecting constitutional challenges based on the separation of powers.

The CJIP has been used in several high-profile cases, including the HSBC Private Bank settlement (€300 million, 2017) and the Société Générale settlement (€250 million, 2018). The mechanism has made French corporate criminal enforcement significantly more active, particularly in international bribery cases where the CJIP facilitates coordination with foreign authorities.