Law of Ukraine

“On Amendments to Certain Legislative Acts of Ukraine to Implement the Action Plan for the European Union Liberalization of the Visa Regime for Ukraine, Regarding Liability of Legal Entities”

Date of entry into force:
September 1, 2014

The purpose of the Criminal Code of Ukraine of May 5, 2001 is providing legal foundation for the protection of human and citizen rights and freedoms, property, civil order and public safety, environment, and constitutional order of Ukraine from criminal encroachment, ensuring peace and human safety, and preventing crimes. To this end, the Criminal Code of Ukraine determines which socially dangerous actions are crimes, and which punishments are imposed against persons that commit them.

The Law supplements the Criminal Code of Ukraine with a new section that provides for criminal sanctions in regard of legal entities.

The grounds for imposing criminal sanctions against legal entities are established by the new Article 96-3 of the Criminal Code of Ukraine.

Criminal sanctions can be imposed by court against a company, institution or organization, except for state authorities, bodies of power of the Autonomous Republic of Crimea, bodies of local self-government, organizations created by them according to the established procedure fully financed by the respective state or local budget, funds of mandatory state social insurance, the Deposit Guarantee Fund, and international organizations (new Article 96-4 of the Criminal Code of Ukraine).

The new Article 96-5 of the Criminal Code of Ukraine establishes the grounds for exempting a legal entity from criminal sanctions.

According to the new Article 96-6 of the Criminal Code of Ukraine, the court can impose the following criminal sanctions against a legal entity:
  • fine;
  • confiscation of property;
  • liquidation.
For legal entities, fine and liquidation can be used only as the main criminal sanctions, and confiscation of property only as an additional sanction.

According to the new Article 96-7 of the Criminal Code of Ukraine, the court can impose sanctions against a legal entity in form of a fine of UAH 85,000 to UAH 1,275,000. Depending on the gravity of the offence crime committed by the official of the legal entity, the court imposes the following fines:
  • for crimes of small gravity – UAH 85,000 to UAH 170,000;
  • for crimes of medium gravity – UAH 170,000 to UAH 340,000;
  • for grave crimes – UAH 340,000 to UAH 850,000;
  • for especially grave crimes – UAH 850,000 to UAH 1,275,000.
Taking the financial state of the legal entity into consideration, the court can permit payment of the fine by installments, over a period of up to three years.

The procedure of imposing confiscation of property and liquidation to legal entities is established by the new Articles 96-8 and 96-9 of the Criminal Code of Ukraine.

According to the Law, when imposing criminal sanctions against a legal entity, the court takes into consideration the gravity of the crime committed by its authorized person, the degree of criminal intent, the amount of damages caused, the nature and amount of inappropriate advantages that was or could have been received by the legal entity, and the measures the legal entity had taken to prevent the crime (the new Article 96-10 of the Criminal Code of Ukraine).

The specifics of imposing criminal sanctions against legal entities for aggregate of crimes are described in the new Article 96-11 of the Criminal Code of Ukraine.

The Law supplements the Criminal Procedural Code of Ukraine with a new Article 64-1, which determines the procedural status of a representative of a legal entity against which criminal proceedings are underway.

Due to the implementation of criminal liability of legal entities, the Law makes appropriate amendments to Articles 3, 29, 65, 89, 91, 93, 95, 98, 99, 100, 120, 122, 139, 140,  170 – 174, 214, 220, 221, 223, 225, 280, 282, 284, 290, 291, 293, 302, 303, 305, 314, 326, 337, 339, 340, 341, 351, 352, 356, 364, 368, 374, 376, 393, 425, and 469 of the Criminal Procedural Code of Ukraine.

Amendments to Article 2 of the Law of Ukraine “On Ensuring the Safety of Persons Taking Part in Criminal Proceedings” provide that the representative of a legal entity against which criminal proceedings are underway is also entitled to have their safety ensured by appropriate means.

The Law envisages that the Law of Ukraine “On Grounds of Corruption Prevention and Counteraction” is supplemented by a new Article 17-1, according to which, if an authorized person of a legal entity commits a crime in the name of said legal entity and in its interests, whether independently or jointly with other persons, criminal sanctions established by the Criminal Code of Ukraine shall be imposed against the legal entity.
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