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In six months, on 8 April 2026, Belgium will implement the brand-new Criminal Code, marking the first comprehensive update in over 150 years. This reform modernizes and simplifies criminal law by clarifying rules and introducing new concepts. For companies and directors, the new Criminal Code will have a tangible impact. Below, we outline the key changes affecting criminal liability for directors and companies, as well as the new penalties introduced.
Criminal liability for directors
Directors can be held liable not only for offences they personally commit but also for offences committed by others within the company if they fail to take adequate precautions.
With the introduction of the new Criminal Code, directors can be more easily held accountable for offences committed by others within the organisation through the concept of “knowing negligence”. Failure to act and thereby directly facilitating or promoting committing an offence is explicitly defined as a concrete form of participation (“nalaten om te handelen en hierdoor het plegen van het misdrijf rechtstreeks hebben bevorderd of vergemakkelijkt” / “ceux qui ont par leur inaction encourage ou facilité directement la commission de l’infraction”). A director who could have been aware of irregularities but fails to take action may be considered a participant in the offence. Directors who become aware of signs of criminal conduct and do not take action will face a real risk of prosecution under the new Criminal Code.
Like the old Criminal Code, the new Criminal Code explicitly states that the criminal liability of a legal entity does not exclude the liability of natural persons, whether as perpetrators or participants in the same offence.
Criminal liability for companies
The liability regime for legal entities was completely overhauled in 2018. This recently revised regime has been incorporated into the new Criminal Code. To materially attribute an offence to a legal entity, there must be an intrinsic connection to the entity’s purpose, interests, or the offence must have been committed on its behalf. To morally attribute criminal responsibility to a legal entity, it must be shown that the offence resulted from an intentional decision made within the organisation or that negligence at the organisational level is causally linked to the offence.
New punishments
The new Criminal Code reforms the entire penalty system, introducing eight distinct levels of sanctions for both natural and legal persons. It also introduces a wide range of new penalties. Below, we will focus on the penalties that are particularly relevant for legal entities and directors.
The community service order (“dienstverleningsstraf ten gunste van de gemeenschap”/ “peine de prestation en faveur de la communauté”) serves as an alternative for legal entities to the traditional community service (only available for natural persons). Under this penalty, the legal entity is required to allocate a dedicated budget for the benefit of the community. The court determines the exact amount and may also provide guidance on the specific nature and implementation. Additionally, a fine can be imposed if the community service is not carried out. The legal entity must agree to this sanction. An advantage of this measure for the company involved is the opportunity to potentially restore its damaged reputation.
The monetary penalty based on the expected or obtained benefit from the offence (“geldstraf vastgelegd op basis van het verwachte of uit het misdrijf behaalde voordeel”/ “peine pécuniaire fixée en fonction du profit escompté ou obtenu de l’infraction”) is a financial sanction calculated based on the expected or actual economic benefit gained from the offence. For a judge to impose this punishment, three conditions must be met: (1) the offence must aim to obtain a financial advantage, (2) the statutory fine alone must be deemed insufficient as a sanction, and (3) the penalty may not exceed three times the value of the benefit obtained or intended. When determining the amount of the monetary penalty, the judge must take into account the financial and social situation of the legal entity or natural person. The higher the capacity to pay, the higher the monetary penalty will be. This penalty aims to impact the convicted party financially, in contrast to the existing forfeiture measure (“verbeurdverklaring”/ “confiscation”), which is intended to prevent the convicted from unjustly enriching themselves. The possible combination of this monetary penalty with statutory fines and various forfeiture measures for companies could result in significant financial consequences.
Similar to its application for natural persons under the old Criminal Code, the new Criminal Code now extends the probation verdict (“probatiestraf”/ “peine de probation”) to legal entities. A probation measure requires compliance with general and specific conditions for a period determined by the court. For legal entities, the sole general condition is to refrain from committing new offences, which may be accompanied by additional specific conditions. The legal entity must consent to the probation sentence, and the court may impose a substitute fine if the conditions are violated.
Finally, the new Criminal Code introduces the professional ban (“beroepsverbod”/ “interdiction professionnelle”) as a general additional penalty, rather than limiting it to specific legislation. This sanction can be imposed when a convicted person has seriously abused his professional position to commit an offence. In addition to the professional ban applicable to natural persons, the new Code also provides for the possibility to prohibit legal entities from engaging in activities that form part of their corporate purpose (“verbod om een activiteit die deel uitmaakt van het maatschappelijk doel uit te oefenen” / “l’interdiction exercer une activité relevant de l’objet social”).
Conclusion
The new Criminal Code introduces additional risks for companies and directors. In particular, the threshold for prosecuting directors has been lowered through the concept of knowing negligence, while stricter sanctions have increased the potential financial exposure for both directors and legal entities. Given these developments, heightened vigilance is essential, and proactive measures must be taken to manage these risks effectively.
With the new Criminal code on the horizon, companies and directors must recognize the growing importance of key actions to effectively manage the increased risks:
- delegation of authority: clearly and transparently define in writing who is responsible for specific supervisory or managerial tasks. This helps to avoid criminal liability for other directors in relation to offences committed within the scope of the delegated duties,
- structural and policy adjustments: make necessary changes to the organisation’s structure, governance policies, supervision processes, and operational workflows to establish a solid internal framework, promote effective compliance, and strengthen internal controls,
- legal risk assessment: use the next six months to thoroughly protect your company and yourself against potential criminal convictions, for example by reviewing directors’ liability insurance coverage.
Please do not hesitate to reach out should you require any advice or assistance in relation to the entry into force of the new Criminal Code.
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