{"id":1736,"date":"2025-12-15T07:05:00","date_gmt":"2025-12-15T07:05:00","guid":{"rendered":"https:\/\/leukos.at\/association-liability-when-are-companies-liable-and-how-can-the-risk-be-minimized\/"},"modified":"2026-05-20T14:34:07","modified_gmt":"2026-05-20T14:34:07","slug":"association-liability-when-are-companies-liable-and-how-can-the-risk-be-minimized","status":"publish","type":"post","link":"https:\/\/leukos.at\/en\/association-liability-when-are-companies-liable-and-how-can-the-risk-be-minimized\/","title":{"rendered":"Association liability: When are companies liable &#8211; and how can the risk be minimized?"},"content":{"rendered":"\n<div class=\"wp-block-columns is-layout-flex wp-container-core-columns-is-layout-28f84493 wp-block-columns-is-layout-flex\">\n<div class=\"wp-block-column is-layout-flow wp-block-column-is-layout-flow\">\n<p><strong>1. When is a company liable under the VbVG?<\/strong><\/p>\n\n\n\n<p>The core of association liability is the attribution of an offense to the company. The law provides for two connecting factors:   <\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Either the act was committed &#8220;<strong>for the benefit of the association<\/strong>&#8221; or  <\/li>\n\n\n\n<li>committed by &#8220;<strong>breach of associational duties<\/strong>&#8220;.<\/li>\n<\/ul>\n\n\n\n<p>An act <strong>in favor of<\/strong> the association is given if the company should benefit economically as a result &#8211; for example, by seeking to enrich itself, by saving costs or by securing or obtaining business advantages. Typical examples are manipulated balance sheets, unlawful price fixing or offenses in the area of corruption and taxes. <\/p>\n\n\n\n<p>A <strong>breach of duty<\/strong> occurs when obligations are violated that affect the company legally or organizationally. This includes, in particular, duties of care and protection enshrined in civil, administrative and supervisory law. A structural or organizational deficit is often sufficient to trigger liability &#8211; even if the offence was committed by an individual employee.  <\/p>\n\n\n\n<p><strong>2. Distinction between decision-maker and employee actions<\/strong><\/p>\n\n\n\n<p>The VbVG distinguishes between criminal offenses of  <\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>decision makers<\/strong> and  <\/li>\n\n\n\n<li><strong>Employees<\/strong>.<\/li>\n<\/ul>\n\n\n\n<p>Decision-makers are managing directors, board members, authorized signatories, supervisory board members, but also other persons with significant influence on the management, such as shareholders or de facto managing directors. If these persons act unlawfully and culpably in their function, the act is directly attributed to the association. In practice, this means that misconduct at management level almost automatically leads to association liability.  <\/p>\n\n\n\n<p>The situation is more complex in the case of criminal offenses committed by employees. Here, the company is only liable if the crime was made possible or significantly facilitated by inadequate supervision or insufficient organization. A lack of the dual control principle, unclear responsibilities, undocumented processes or inadequate training may be sufficient to impute &#8220;<em>organizational responsibility<\/em>&#8221; to the company.  <\/p>\n\n\n\n<p><strong>3. Impending consequences<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Fines<\/strong><\/li>\n<\/ul>\n\n\n\n<p>In the event of liability, the court can impose an association fine. The amount of the fine depends on the penalty for the underlying offense and the economic performance of the company. Depending on the offense, the possible fines can reach into the millions.  <\/p>\n\n\n\n<p>The conduct of the company in the course of the investigation plays a central role in the assessment of the fine. Cooperation with the authorities, internal investigations, compensation for damages and the implementation or improvement of compliance measures can significantly reduce the penalty or even lead to the public prosecutor&#8217;s office refraining from criminal prosecution due to the so-called prosecution discretion. <\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Further consequences<\/strong><\/li>\n<\/ul>\n\n\n\n<p>In addition, criminal proceedings against a company are usually accompanied by far-reaching collateral damage: even being a defendant alone can lead to a loss of reputation, administrative law problems and economic damage.<\/p>\n\n\n\n<figure class=\"wp-block-gallery has-nested-images columns-default is-cropped wp-block-gallery-1 is-layout-flex wp-block-gallery-is-layout-flex\">\n<figure class=\"wp-block-image size-large\"><img fetchpriority=\"high\" decoding=\"async\" width=\"1024\" height=\"713\" data-id=\"2162\" src=\"https:\/\/leukos.at\/wp-content\/uploads\/2025\/12\/Screenshot-2026-05-20-145026-1024x713.png\" alt=\"\" class=\"wp-image-2162\" srcset=\"https:\/\/leukos.at\/wp-content\/uploads\/2025\/12\/Screenshot-2026-05-20-145026-1024x713.png 1024w, https:\/\/leukos.at\/wp-content\/uploads\/2025\/12\/Screenshot-2026-05-20-145026-300x209.png 300w, https:\/\/leukos.at\/wp-content\/uploads\/2025\/12\/Screenshot-2026-05-20-145026-768x535.png 768w, https:\/\/leukos.at\/wp-content\/uploads\/2025\/12\/Screenshot-2026-05-20-145026-1536x1070.png 1536w, https:\/\/leukos.at\/wp-content\/uploads\/2025\/12\/Screenshot-2026-05-20-145026-2048x1427.png 2048w\" sizes=\"(max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n<\/figure>\n<\/div>\n\n\n\n<div class=\"wp-block-column is-layout-flow wp-block-column-is-layout-flow\">\n<p><strong>4 Where are the greatest risks in practice?<\/strong><\/p>\n\n\n\n<p>Association proceedings are particularly frequent in the area of economic offenses &#8211; such as fraud, embezzlement, corruption, anti-competitive agreements or tax evasion. Violations in the areas of the environment, employee protection or product safety can also give rise to association liability. <\/p>\n\n\n\n<p>It is striking that companies are often not prosecuted for &#8220;<em>active<\/em>&#8221; criminal energy, but because internal structures were incomplete or insufficiently documented.  <\/p>\n\n\n\n<p>A lack of control mechanisms or unclear responsibilities are among the most frequent triggers for association proceedings.<\/p>\n\n\n\n<p><strong>5 How can companies minimize the risk?<\/strong><\/p>\n\n\n\n<p>Effective preventive measures are the key to minimizing risk &#8211; and are also taken into account by the authorities and courts.  <\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>A <strong>well-structured compliance system<\/strong> therefore not only serves the purpose of prevention, but is also a key defense instrument. This can be a prerequisite for refraining from prosecution or diversionary measures. <\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li>A clear and <strong>comprehensible organization<\/strong> in which responsibilities, decision-making channels and control mechanisms are clearly defined is crucial.  <\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li>A functioning <strong>internal control system<\/strong> with risk assessments, approval processes and regular reviews forms the basis for any modern compliance structure.<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Equally important are <strong>binding behavioral guidelines<\/strong> and a consistent &#8220;<em>tone from the top<\/em>&#8220;. Guidelines on anti-corruption, conflicts of interest and money laundering prevention should be clearly formulated and accessible to all employees. <\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Regular training<\/strong> in those areas where criminal risks typically arise &#8211; such as sales, purchasing, finance or management &#8211; is also essential. Training not only serves to raise awareness, but also creates important documentation that can be of great benefit in criminal proceedings. <\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Finally, companies should not hesitate to conduct <strong>internal investigations<\/strong> in suspected cases. Rapid clarification, securing relevant data, cooperation with authorities and, if necessary, compensation for damages can make a decisive contribution to preventing or mitigating criminal consequences and economic damage. <\/li>\n<\/ul>\n\n\n\n<p><strong>6. conclusion<\/strong><\/p>\n\n\n\n<p>The VbVG has established itself in practice and focuses primarily on prevention, cooperation and education. Its consistent application shows: Good organization protects &#8211; legally, economically and reputationally. <\/p>\n\n\n\n<p>Companies that create clear structures, actively manage risks and see compliance as an integral part of their everyday life can significantly reduce the risk of association proceedings &#8211; and are also better prepared if a suspected case does arise. This applies in particular to cases of employee misconduct, where organizational culpability is also always assumed. <\/p>\n\n\n\n<p><strong>Do you need support?<\/strong><\/p>\n\n\n\n<p>We support companies in all phases &#8211; from prevention and internal investigations to defense in association proceedings. We also provide support in the development or adaptation of compliance systems, employee training and the analysis of operational risks. <\/p>\n\n\n\n<p><strong>Contact LEUKOS for a<\/strong> <strong>confidential initial consultation<\/strong>.<\/p>\n<\/div>\n<\/div>\n\n<p><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Companies are increasingly becoming the focus of criminal investigations. Since the Austrian Corporation Liability Act (VbVG) came into effect, not only individuals but also the association itself can be held liable for criminal offenses.  In particular, managing directors, shareholders and compliance officers should therefore be familiar with the conditions under which an organization can be held liable in order to effectively mitigate the risk. <\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-1736","post","type-post","status-publish","format-standard","hentry","category-nicht-kategorisiert"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v26.7 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Association liability: When are companies liable - and how can the risk be minimized? - LEUKOS Brewi Krepil Rechtsanw\u00e4lte Wien\u2028<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/leukos.at\/en\/association-liability-when-are-companies-liable-and-how-can-the-risk-be-minimized\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Association liability: When are companies liable - and how can the risk be minimized? - LEUKOS Brewi Krepil Rechtsanw\u00e4lte Wien\u2028\" \/>\n<meta property=\"og:description\" content=\"Companies are increasingly becoming the focus of criminal investigations. Since the Austrian Corporation Liability Act (VbVG) came into effect, not only individuals but also the association itself can be held liable for criminal offenses. 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Since the Austrian Corporation Liability Act (VbVG) came into effect, not only individuals but also the association itself can be held liable for criminal offenses. 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