Article 321 of the IPC extends Articles 318, 319 and 319 ter to the person offering the bribe.

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1 Italy Summary of Italy's corruption laws within both the public and private sector. Reviewed April 2015 PUBLIC OFFICIALS Is there an offence of bribing public officials? There are various sections of the Italian Penal Code (IPC) which cover public bribery. Under Articles 318, 319 and 321 IPC, there are offences which cover both the offering and the acceptance or receipt of money or any other benefit of value by either domestic or foreign public officials to perform or to refrain from performing acts related to their office. There are also specific offences of extortion by a public official under Article 317, inducement under Article 319 quarter, trading in influence under Article 346 and judicial bribery under Article 319 ter. What is the relevant test for each offence? The Public Prosecutor must prove that the criminal behaviour, which consists of offering, promising, giving, or in the case of extortion requesting money or other benefits to or from a public officer, took place and that the individual acted intentionally with regard to the elements of the crime. Under Article 317 of the IPC (extortion by a public official 1 ) a public officer or person in charge of a public service 2 will be guilty of extortion (concussione) if he abuses his functions or power by forcing a person to unduly give or promise money or an advantage to him or to a third party. Pursuant to Article 318 of the IPC (bribery for performing acts in an official capacity), it is an offence for a public

2 officer, acting in an official capacity, to accept a promise for or receive, for himself or a third party, compensation in the form of money or any other benefit of value, not due, in order to induce him to do an act related to his office. Article 320 extends this offence to persons in charge of a public service. Under Article 319 of the IPC (bribery with regard to acts contrary to official capacity), it is an offence for a public officer to accept a promise for or receive, for himself or a third party, money or any other benefit of value, in return for omitting or delaying an official act or for performing acts in breach of the duties of the office. Article 320 also extends this offence to persons in charge of a public service. Under Article 319 quarter it is an offence for a public officer or a person in charge of a public service, to abuse his functions or power to induce an individual to unduly give or promise money or an advantage to him or to a third party (inducement). A specific offence of judicial bribery is set out in Article 319 ter when a bribe is paid or promised in order to favour or damage a party involved in civil, criminal or administrative proceedings. Under Article 346 of the IPC (trading in influence), a person who exploits his or her existing relationship with a public official or a person in charge of a public service, by receiving money or any other economic advantage for himself or a third party as consideration for his illicit intermediation with that public official or person in charge of a public service, will be guilty of trading in influence. The provision is also applicable to the person who gives or promises the money or economic advantage. Article 321 of the IPC extends Articles 318, 319 and 319 ter to the person offering the bribe. Article 322 extends Articles 318 and 319 to cover bribery of foreign public officials so that it includes persons carrying out functions or activities equivalent to those performed by public officials and persons in charge of a public service within other foreign states or public international organisations. Historically, the provisions on bribery contained in the IPC did not expressly provide for cases of bribes made through intermediaries; however the courts have interpreted these provisions broadly so as to cover such circumstances. 1. Under Article 357 of the IPC, a public official is an individual who practices a legislative, judicial or administrative function and may include notaries, policemen, judges, bailiffs, sanitary inspectors and physicians working for the national health service. The term administrative function means a role that is subject to constitutional law or an Authority s instructions, which is characterised by the implementation and the demonstration of the intent of a public authority (ie through the authorising and certification of powers). Accordingly, it is sufficient that the individual carries out a public duty or a public service. 2. A person in charge of a public service is an individual who provides a public service, save for merely executing duties, and may include nurses, clerks employed for sorting mail, school caretakers and drivers of public transport. The term public service means an activity carried out under the same conditions as that of a public function, but does not entail practicing the relevant powers typical of a public authority. Can corporates and individuals commit the offence?

3 Historically in Italy criminal liability was ascribable only to individuals. Corporate criminal liability was introduced into the Italian legal system recently for specific offences mentioned by Legislative Decree no. 231 of June 08, 2001 (L.D. 231/2001). Under L.D. 231/2001, corporates can be criminally liable for certain offences of bribing public and foreign public officials which have been committed during the performance of company activities. The offences of inducement (Article 319 quarter) and trading in influence (Article 346) are not listed in the relevant provision and therefore cannot be committed by corporates. Corporate criminal liability is attributable when: the crime has been committed in the company s interest or to its advantage, the offenders are individuals holding a high managerial role within the company or a subordinate position to the former if there was a failure of oversight by those holding a high managerial role, and the offenders have not acted for their exclusive interest or a third party s interest. High managerial role means the company s top management and chief executives. When the perpetrator of the crime is a person in a subordinate role, the company will be criminally liable if it can be proved that they failed in their obligation to direct and control the subordinate subject. Does the offence have extra-territorial effect? The offences apply to Italian nationals who commit offences overseas when: the offender is within Italian territory, the offence is punishable by Italian law by a minimum of three years imprisonment, and the offence is committed to the detriment of the EC or a foreign country, at the request of the Minister of Justice and where extradition has not been requested/granted. The offences also apply to non-nationals who commit offences overseas when: the offender is within Italian territory, the offence is committed to the detriment of the Italian state or an Italian national and is punishable by a minimum of one year imprisonment (at the request of the Minister of Justice or the victim), or the offence is committed to the detriment of the EC or a foreign country and is punishable by at least three years imprisonment,

4 at the request of the Minister of Justice and where extradition has not been requested/granted. With regard to corporate criminal liability, foreign companies can be prosecuted pursuant to L.D. 231/2001 for crimes committed within Italian territory, even if their registered office is not in Italy. Foreign companies are subject to Italian law and statutes when carrying on business within Italian territory. Italian companies can also be held liable for certain crimes committed abroad, provided that the state where the crime occurred has not begun criminal proceedings on the same grounds. Are there any exceptions or defences? No specific exceptions or defences are provided for individual criminal liability. With regard to corporate criminal liability, when the perpetrator of the crime is a person in a top managerial role, the company will be criminally liable unless they have adopted a suitable organisational and management model aimed at preventing the commission of the crime (ie have a compliance programme in place). The burden of proof is on the company to demonstrate that the crime was committed by the relevant person circumventing the preventative measures put in place by the company. L.D. 231/2001 does not specify the components of the compliance programme, however it has entrusted the main business associations (such as Confindustria, the Italian Manufacturers Association) with issuing guidelines for implementation of a compliance programme. The major guidelines are historically those issued by Confindustria. What are the penalties? Individuals The penalties for the following offences are: Article 317 (extortion by a public official): between six and 12 years imprisonment and permanent disqualification from any public office. Article 318 (bribery for performing acts in an official capacity): between one and five years imprisonment and temporary disqualification for between one and five years from any public office. Article 319 (bribery with regard to acts contrary to official capacity): between four and eight years imprisonment and temporary disqualification from any public office. Article 319 ter (judicial bribery): between four and five years imprisonment. Article 319 quarter (inducement): between three and eight years imprisonment and temporary disqualification from any public office. Article 322 (where a bribe is offered to a public official but not accepted): the briber will be subject to a third of the

5 maximum penalty applicable if the bribe had been accepted, and Article 346 (trading in influence): between one and five years imprisonment and a fine ranging between and 2, Corporates Under L.D. 231/2001, the maximum penalty for corporates is 1,550,000 for the various bribery offences. Companies can also be subject to the following sanctions: temporary disqualification from certain activities suspension or revocation of licences prohibition from dealing with the public administration exclusion from public financing and repeal of existing financing temporary exclusion from advertising goods and services, and publication of the sentence. PRIVATE SECTOR Is there an offence for bribery within the private sector? Law 190/2012 introduced a general provision which criminalises bribery occurring in the private sector under Article 2635 of the Italian Civil Code (ICC). What is the relevant test? Under Article 2635 of the ICC, directors, general managers, CFOs, statutory auditors or liquidators (or individuals who are subject to the direction or control of the former), are criminally liable for performing or failing to perform acts in breach of their office or duties of loyalty, having received or having been promised money or any other advantage for themselves or a third party, if their behaviour caused harm to the company. An individual who gives or promises money or an economic advantage is criminally liable as well. The crime can only be prosecuted at the request of the victim of the crime, unless the behaviour caused distortion in the competition for goods or services. In addition, there are several provisions that punish specific criminal behaviour, such as inducement to commit perjury or not to testify promising or offering an undue advantage to participants of public biddings and auctions so that they abstain from taking part in or hinder the bidding, and promising or offering an undue agreement with creditors of bankrupted companies. Can corporates and individuals commit the offence?

6 Corporates can be criminally liable for the offences of: bribery occurring in the private sector (Article 2635 ICC), and inducement to commit perjury or not to testify (Article 377 bis IPC). which have been committed during the performance of company activities. Corporate criminal liability is attributable only when: The crime has been committed in the company s interest or to its advantage. The offenders are individuals holding a top managerial role within the company or a subordinate position to the former if there was a failure of oversight by those holding a high managerial role. The offenders have not acted for their exclusive interest or a third party s interest. When the perpetrator of the crime is a person in a subordinate role, the corporate will be criminally liable if it can be proved that they failed in their obligation to direct and control the subordinate subject. Does the offence have extra territorial effect? The offences apply to Italian nationals who commit offences overseas when: the offender is within Italian territory the offence is punishable by Italian law by a minimum of three years imprisonment, and the offence was committed to the detriment of the EC or a foreign country at the request of the Minister of Justice and where extradition has not been requested/granted. The offences also apply to non-nationals who commit offences overseas when: the offender is within Italian territory, the offence is committed to the detriment of the Italian state or an Italian national and is punishable by a minimum of one year imprisonment (at the request of the Minister of Justice or the victim), and the offence is committed to the detriment of the EC or a foreign country and is punishable by at least three years imprisonment at the request of the Minister of Justice and extradition has not been requested/granted. With regard to corporate criminal liability, foreign companies can be prosecuted pursuant to L.D. 231/2001 (corporate criminal liability) for crimes committed within Italian territory, even if their registered office is not in Italy. Foreign companies are subject to Italian law and statutes when carrying on business within the Italian territory. Italian companies can be held liable for certain crimes committed abroad, provided that the State where the crime

7 has occurred has not begun criminal proceedings on the same grounds. Are there any exceptions or defences? No specific exceptions or defences are provided for individual criminal liability. With reference to corporate criminal liability, when the perpetrator of the crime is a person holding a top managerial role, the company will be criminally liable unless the company has adopted a suitable organisational and management model aimed at preventing the commission of the crime (ie has a compliance programme in place). The burden of proof is on the company to demonstrate that the crime has been committed by the relevant person circumventing the preventive measures put in place. What are the penalties? Individual liability: the crime of bribery committed in the private sector (Article 2635) is punishable by between one and three years imprisonment, the crime of inducement to commit perjury or not to testify is punishable by between two and six years imprisonment, promising or offering an undue advantage to participants of public biddings and auctions is punishable by up to two years imprisonment and a fine of between 103 and 1,032, promising or offering an undue advantage to a manager, director, auditor or member of an auditing company to omit or delay an act in breach of that office is punishable by up to three years imprisonment, and promising or offering an undue agreement with creditors of bankrupted companies is punishable by between one and five years imprisonment. Corporate liability: the offence of bribery committed win the private sector (Article 2635) is punishable under L.D. 231/2001 by a fine raging between and 619,600.00, the offence of inducement to commit perjury or not to testify is punishable under L.D. 231/2001 by a maximum fine of 774, Penalties are doubled when the same offence is committed by corporates whose securities are listed on the Italian or an EU Stock Exchange or are widely distributed among the public As provided by the Financial Act no. 58 of February 24, 1998.

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