You are on page 1of 37

CORPORATE CRIMINAL

LIABILITY
IN VIETNAM

NGUYEN QUANG VU/HA KIEU ANH

VENTURE NORTH LAW


CONTENT
Introduction

Scope of Application

Corporate Crimes

Criminal Liability

Criminal Proceedings

www.vnlaw.com.vn . www.vietnam-business-law.info 2
INTRODUCTION

takes effect

Criminal Penal Code


Procedure 2015
Code 2015

INTRODUCTION www.vnlaw.com.vn . www.vietnam-business-law.info 3


KEY REQUIREMENTS FOR IMPOSING CRIMINAL LIABILITY

the time-limit the criminal act


33 specific
(thời hiệu) has
not expired crimes is committed

under instruction,
in the name for the benefit guidance or acceptance
the legal entity must be a
“commercial legal
person” of the commercial legal person
(pháp nhân thương mại)

INTRODUCTION www.vnlaw.com.vn . www.vietnam-business-law.info 4


Subjected entities Territory

SCOPE OF APPLICATION www.vnlaw.com.vn . www.vietnam-business-law.info 5


SUBJECTED ENTITIES
A COMMERCIAL
LEGAL PERSON

The entity’s main objective is


Profit of a commercial legal
The entity must be a “legal “seeking profit” e.g., an
person is distributed to its
person” enterprise (except social
members
enterprise)

 COMMENTS:
It is not clear why the Criminal Proceedings Code 2015 uses the term ‘legal person’ instead of the term ‘commercial legal
person’ for consistency with the Penal Code 2015.
If a legal person is liquidated, merged, consolidated, or split and ceases to exist, only civil obligations (unpaid debts and
property obligations) are transferred.

SCOPE OF APPLICATION www.vnlaw.com.vn . www.vietnam-business-law.info 6


BUT other legal persons (e.g. NGO or
Government agencies) or non-legal persons
can commit crimes?

SCOPE OF APPLICATION www.vnlaw.com.vn . www.vietnam-business-law.info 7


TERRITORY
ALL CRIMINAL ACTS COMMITTED WITHIN THE TERRITORY OF VIETNAM
(ART 5.1 PC2015)
COMMENTS
 It is not clear whether the Penal Code 2015 applies on criminal acts of foreign
commercial legal persons (with or without diplomatic immunity) committed in
Vietnam. If yes, how to determine the legal status of such foreign entities?
• Possibly only applicable to foreign commercial legal persons in Vietnam who cannot claim
diplomatic immunity;
• Can Art 676.3 of the Civil Code 2015 on civil capacity of foreign legal person apply to
criminal capacity of such person?

SCOPE OF APPLICATION www.vnlaw.com.vn . www.vietnam-business-law.info 8


A commercial legal person can only
be convicted by the specific crimes
listed in Art 76 of the Penal Code 2015
33 crimes are listed, with
the maximum monetary
fine ranges from 1 to 20
billion VND
the applicable time of
temporary suspension ranges
from 6 to 36 months, and

CORPORATE CRIMES
possibly permanent
suspension
www.vnlaw.com.vn . www.vietnam-business-law.info 9
Crime Maximum monetary fine Temporary suspension Permanent
(billion VND) (months) suspension (yes/no)
Article 188 - Smuggling 15 6 – 36 y
Article 189 - Illegally trafficking goods or money across the border 5 6 – 36 y
Article 190 - Manufacturing or trading banned goods 9 6 – 36 y
Article 191 – Hoarding or, transporting banned goods 5 6 – 36 y
Article 192 - Manufacturing or trading counterfeit goods 9 6 – 36 y
Article 193 - Manufacturing or trading counterfeit food or food 18 6 – 36 y
additives
Article 194 – Manufacturing or trading counterfeit medicines for 20 12 – 36 y
treatment or prevention of diseases
Article 195 –Manufacturing or trading counterfeit animal feeds, 15 6 – 36 y
fertilizers, veterinary medicine, pesticides, plant varieties, animal breeds
Article 196 - Speculating 9 n n
Article 200 - Evading tax 10 6 – 36 y
Article 203 - Illegal printing, issuing or trading of invoices or receipts 1 n y
Article 209 - Deliberately publishing false information or concealing 5 n n
information in securities activities
Article 210 - Using insider information to deal securities 10 n n
Article 211 - Manipulating the stock market 10 n y
Article 213 - Committing frauds in insurance business 7 n n
Article 216 - Evading payments of social insurance, health insurance, 3 n n
unemployment insurance for employees
Article 217 – Violating competition regulations 5 6 – 24 n

CORPORATE CRIMES www.vnlaw.com.vn . www.vietnam-business-law.info 10


Crime Maximum monetary fine Temporary suspension Permanent
(billion VND) (months) suspension (yes/no)
Article 225 - Infringing copyrights and related rights) 3 6 – 24 n
Article 226 - Infringing industrial property rights 5 6 - 24 n
Article 227 - Violating regulations on survey, exploration, and 7 6– 36 n
exploitation of natural resources
Article 232 - Violating regulations on forest exploitation and protection, 6 12 – 36 n
and forest product management
Article 234 - Violating regulations on management and protection of 6 6 – 36 y
wild animals
Article 235 - Polluting environment 20 12 – 36 y
Article 237 - Violating regulations on environmental emergency 10 12 – 36 y
prevention, response, and relief
Article 238 – Violating regulations on irrigation works, dykes, natural 5 n y
disasters prevention, protection of riverside
Article 239 - Importing wastes into Vietnam’s territory 7 12 – 36 y
Article 242 - Destructing aquatic resources 5 6 – 36 n
Article 243 - Destructing forest 7 6 – 36 y
Article 244 - Violating regulations on management and protection of 15 6 – 36 y
endangered, rare animals
Article 245 - Violating regulations on management of wildlife 3 6 – 36 y
sanctuaries
Article 246 - Importing and spreading of invasive alien species 5 6 – 36 n
Article 300 – Financing terrorism 15 6 – 36 y
Article 324 – Laundering money 20 12 – 36 y

CORPORATE CRIMES www.vnlaw.com.vn . www.vietnam-business-law.info 11


COMMENTS
Certain crimes which usually happen in the context of a
commercial legal person are not included in Article 76 of the Penal
Code 2015 such as bribery or accounting fraud

With some specific conditions, a


commercial legal person’s failure to report
criminal act may be create criminal
liability
Two or more commercial legal persons committing
a crime together cannot be considered as
conspiracy

CORPORATE CRIMES www.vnlaw.com.vn . www.vietnam-business-law.info 12


ARTICLE 75 OF THE PENAL CODE

the criminal act


is committed
? ?
under instruction,
in the name for the benefit guidance or acceptance

of the commercial legal person

CRIMINAL LIABILITY www.vnlaw.com.vn . www.vietnam-business-law.info 13


? ?
WHO CARRIES OUT THE CRIME?

The person But how many individuals:


committing the one or more ???
criminal act
should be an
individual
but not another
legal person. Collective (BOD and GMS?) or
individual (Chairman and
GD?) instruction, guidance and
acceptance ???

CRIMINAL LIABILITY www.vnlaw.com.vn . www.vietnam-business-law.info 14


? ?
WHO CARRIES OUT THE CRIME?

at least two persons need to be identified:


• one person undertakes the criminal act in
the name of the commercial legal person;
and
• one person “instructs, guides or accepts”
the criminal act commits by the former.

Can they be the


same person?

CRIMINAL LIABILITY www.vnlaw.com.vn . www.vietnam-business-law.info 15


in the name of
the commercial legal person
the words “in the name of” (nhân
danh) is to indicate an agency
relationship ??? But there is no
concept of apparent authority

Person to commit a criminal act:


only the legal representative or an authorised person
or
even other related persons (e.g., an employee or a
contractor of the legal person)

CRIMINAL LIABILITY www.vnlaw.com.vn . www.vietnam-business-law.info 16


in the name of
the commercial legal person
“member” means
an individual who is the owner of the legal
person
or
Article 441 of the an individual who just belongs to the legal
Criminal person
Proceedings Code
2015 refers to the
criminal acts by an independent
fault of the contractor or by a subsidiary of a
individual being corporation
“member” (thành
viên) of the legal the leader (lãnh đạo)
person the manager (điều hành) or
an authorized person

the collective knowledge


doctrine

CRIMINAL LIABILITY www.vnlaw.com.vn . www.vietnam-business-law.info 17


under instruction, guidance or acceptance of
the commercial legal person

According to the Supreme


“identification theory”
Procuracy’s guidance:

a legal person will be subject to criminal liability only when the leader or the management board of such legal person
knows that the relevant individual’s action is illegal and still give instruction, guidance or accept such action

CRIMINAL LIABILITY www.vnlaw.com.vn . www.vietnam-business-law.info 18


It is not clear if
the person “accepting” the criminal act must do so in a positive manner
or
silence (i.e. wilfull blindness) can amount to acceptance.

CRIMINAL LIABILITY www.vnlaw.com.vn . www.vietnam-business-law.info 19


for the benefit of
the commercial legal person

 the criminal act


 must intend to bring benefits to the
legal person;
 could also bring benefits to the
individual or other third parties.
 the Penal Code 2015 does not require
the benefits of the legal person to be
actually realised, but an intention to
bring about benefit is sufficient

CRIMINAL LIABILITY www.vnlaw.com.vn . www.vietnam-business-law.info 20


SOME OTHER ISSUES

there must be faults of both the legal person and


the individual member of such legal person
or only fault of the legal person is sufficient ???
 in the case of the former, it is not clear to which action
(the criminal act or the act of giving instruction, guidance
or acceptance of such criminal act) such fault relates

CRIMINAL LIABILITY www.vnlaw.com.vn . www.vietnam-business-law.info 21


TIME - LIMIT

A corporate crime under the Penal Code 2015 is also entitled to time bar limitation
Crime Time limitation
less serious crime 5 years
serious crime 10 years
very serious crime 15 years
especially serious crime 20 years

SCOPE OF APPLICATION www.vnlaw.com.vn . www.vietnam-business-law.info 22


TIME - LIMIT

COMMENTS:
 the Penal Code 2015 only classifies the seriousness of crimes committed by an
individual not by a corporation;
 it is not clear if rules on re-commencing time limitation apply to corporation
committing a crime;
 it may be difficult to determine when a corporate crime is completed since a corporate
crime may involve more than one person.

SCOPE OF APPLICATION www.vnlaw.com.vn . www.vietnam-business-law.info 23


CRIMINAL PROCEEDINGS

Institution
Pre- Enforcement
and Prosecution Hearing
institution of judgement
investigation

CRIMINAL PROCEEDINGS www.vnlaw.com.vn . www.vietnam-business-law.info 24


PRE-INSTITUTION

inspection
activities

notify
handling an
administrative
violation
Government body Competent agency

CRIMINAL PROCEEDINGS www.vnlaw.com.vn . www.vietnam-business-law.info 25


INSTITUTION & INVESTIGATION
Specific only certain specific individuals are entitled to interrogate the legal representative of the legal
limitations person
(Article 442 of the
Criminal
the place of interrogation is limited to the head office of the legal person, office of the
Proceeding Code
investigating agency and the place of investigation
2015)

interrogation must not be conducted at night

the interrogator must notify the Procuracy, and the defence counsel of the proposed time and
place of interrogation; and

if conducted at the place of the investigating agency, the interrogation must be video or audio
recorded; if conducted in other places, it will be video or audio recorded at the request of that
legal presentative, competent authorities, or competent persons.

CRIMINAL PROCEEDINGS www.vnlaw.com.vn . www.vietnam-business-law.info 26


INSTITUTION & INVESTIGATION
Time for investigation counted from the date of institution of the criminal case to
the date of completion of such investigation.

Crime Time limit for investigation


less serious crime two months
serious crime three months
very serious crime four months
especially serious crime four months

Such time limit may be extended one or twice, depending on categories of crime, in accordance with Article 172.2 of the
Criminal Proceeding Code 2015 due to the complication of the case upon decision of the competent Procuracy

CRIMINAL PROCEEDINGS www.vnlaw.com.vn . www.vietnam-business-law.info 27


INSTITUTION & INVESTIGATION
investigation
is terminated two days the Procuracy at the
notify
corresponding level

Investigating body Report of


conclusion

or
requiring suspending the charged
prosecution investigation corporation

defense counsel

CRIMINAL PROCEEDINGS www.vnlaw.com.vn . www.vietnam-business-law.info 28


PROSECUTION
a bill of indictment:
to prosecute the the Court
charged corporation
or
before the court
the Procuracy decision to return the case file
or three days *
for further
Time limit to issue the decision not exceeding investigation notify
20 days for less serious crimes and serious
crimes, to suspend or
30 days for very serious crimes and extremely temporarily suspend defense
serious crimes
the case counsel
(these time limits may be extended in case of necessity
upon the decision of the Head Procurator)
* ten days in the case of complexity

CRIMINAL PROCEEDINGS www.vnlaw.com.vn . www.vietnam-business-law.info 29


HEARING
additional
investigation
decision on execution

Chief
7 days Judge

Acceptance Preparation
Opening
procedure of
Court Court Enforcement
of the case for trial judgment of judgement
court trial trial

1 to 4 months maybe

protest appeal

CRIMINAL PROCEEDINGS www.vnlaw.com.vn . www.vietnam-business-law.info 30


HEARING
• charged person
• victim
• civil plaintiff
• asking and listening • civil defendant
statements • interested persons
• witnesses
• expert witnesses
• others who are summoned

• examine material
evidences

The Court
• listen to statements of vs
procurator defense counsel

CRIMINAL PROCEEDINGS www.vnlaw.com.vn . www.vietnam-business-law.info 31


SPECIFIC RULES
(Art 434.1 CPC 2015) a legal person
being subject to a criminal other corporate bodies
proceeding to act via
a legal representative

does not have to prove purpose and currently, there is no


motive of the legal person in order to
specific law regulating the
convict a legal person of a crime (Art
85.2 and 441.2 CPC 2015) enforcement of a criminal
judgement against a legal
person.
the Procuracy

CRIMINAL PROCEEDINGS www.vnlaw.com.vn . www.vietnam-business-law.info 32


POSSIBLE DEFENCE

a legal person is regarded as innocent until


there is an effective judgement of the court
confirming otherwise

a legal person is not


required to give
• can be engaged as soon as the legal person evidence which can
is charged by the investigating agency . be used against itself
*
• should be appointed by the legal
representative of such legal person * limited only to the legal representative, other individuals
lawyer within the legal person may still be summoned as a witness
and be required to give evidence which can be used against
the legal person

CRIMINAL PROCEEDINGS www.vnlaw.com.vn . www.vietnam-business-law.info 33


POSSIBLE DEFENCE
(Art 84 PC 2015)
a convicted legal person the legal person has prevented or mitigated the consequences of the
may be entitled to certain
mitigating factors which
crime
can reduce the criminal
liability of such legal
the legal person has voluntarily remedied the damages caused by the
person crime

the crime has been committed but has not cause damages or the damage
is immaterial

the legal person has actively cooperated with the competent authorities
in uncovering the crime or during the criminal proceeding

the legal person has made significant contribution to the society

CRIMINAL PROCEEDINGS www.vnlaw.com.vn . www.vietnam-business-law.info 34


A corporate compliance program is not a
specific defence but it can be used as:

1. evidence that the


corporation does not
instruct, guide or
accept a criminal act

2. a mitigating factor
(e.g., a mean to
prevent or mitigate
the damages caused
by a crime)

CRIMINAL PROCEEDINGS www.vnlaw.com.vn . www.vietnam-business-law.info 35


www.vnlaw.com.vn . www.vietnam-business-law.info 36
www.vnlaw.com.vn . www.vietnam-business-law.info 37

You might also like