Criminal liability of legal persons in the United States and Canada
#ComplianceKeys15
We close the #ComplianceKeys series on the state of regulation of the criminal liability of legal persons in different countries with an analysis of Canada and the United States.
Before assessing the current state of this issue, it is worth noting that many consider the United States to be the place of origin of corporate liability for offences committed within it, mainly as a result of the New York Central & Hudson River Railroad v. United States case.
Furthermore, it is certainly the country with the longest track record and practical application with respect to corporate liability and Compliance Systems, mainly through sanctions and out-of-court settlements with the U.S. Department of Justice [DOJ]) or the U.S. Securities Exchange Commission [SEC]). This is the case, for example, of the agreements reached with ORACLE and DANSKE BANK in 2022 with the U.S. Securities Exchange Commission (SEC).
Canada also regulates corporate liability. In particular, there is a legal provision, namely in the Criminal Code, which provides for criminal liability for legal persons within which an offence has been committed.
Thus, both Canada and the United States have a body of law that supports the application of corporate criminal liability, for example, through the Foreign Corrupt Practices Act (FCPA) in the United States, or the Criminal Code and the Corruption of Foreign Public Officials Act (CFPOA) in the case of Canada, as well as a firm judicial and punitive application that develops this issue, in which the Sentencing Guidelines in the United States or the case of Canadian Dredge and Dock Co. vs The Queen in Canada are noteworthy.
However, the main difference in the regulation of corporate liability between the two countries is that in the United States the respondeat superior principle applies, which implies a broader or more automatic application of corporate criminal liability. In contrast, in Canada, in order to attribute criminal liability to legal persons, all the requirements of the Canadian Criminal Code must be met, which implies a more limited application.
A summary of the state of the issue in the different countries analysed is attached below:
| Country | Nature of liability | Closed or open list of offences/infringements | Possibility of legal exemption due to Compliance |
| Canada | Criminal | Open list | It is provided for in certain laws, such as the anti-money laundering legislation. |
| United States | Criminal | Open list | Not regulated |
Compliance Department of Molins Defensa Penal.