Will a minority shareholder of a company be able to sabotage its actions through the criminal law?

plpolski (Polish)

The amendment to the Criminal Code, which came into force in October 2023, introduced a change in the criminal liability of corporate managers. In its effect, the circle of persons who may demand the prosecution of persons who, in their opinion, improperly manage a collective entity has been expanded. This can now be done in addition to the wronged party: a partner, shareholder or shareholder of the wronged company or a member of the wronged cooperative. However, it is difficult not to start asking how this change will affect corporate relations in companies.

The amendment concerns Article 296 § 1a of the Penal Code. This provision introduces criminal liability for bringing an imminent danger of causing significant property damage by a person managing another entity. This bringing in of the danger of causing damage is to be the result of the perpetrator’s abuse of power or failure to fulfil a duty. Substantial property damage is damage in excess of PLN 200,000. The sanction is imprisonment for up to three years. Liability may therefore be imposed on those who did not cause the damage – they only took business risky actions that could have caused such damage.

The amendment creates the threat of criminal law being used instrumentally in corporate relations. With this institution, the minority shareholder will be able to interfere in the management of the company to a greater extent than that resulting from his shareholding. His actions may harm other shareholders or the company’s management. This is because a minority shareholder may blackmail, for example, the company’s board of directors with a request for prosecution of a crime committed by them. In his view, certain actions of the management board were risky for the company and should not have been taken. He may, in return for refraining from filing the petition, demand that these actions be stopped or that he be given influence over the management of the company. He would not be able to obtain these privileges by exercising the powers of a shareholder. However, he can use the amendment to the Criminal Code to influence the management against the principles of commercial law.

The company’s management or other shareholders should not, of course, succumb to such blackmail if they believe that they have taken all measures in line with the company’s interests. It is worth remembering that the filing of a request for prosecution does not yet imply the initiation of criminal proceedings. Nor does it mean that charges are automatically brought against the managers. If no damage has been done to the company, on the other hand, it is very difficult to assess whether the management board’s action was excessively risky.

Nevertheless, in the case of such “corporate blackmail”, it is worth consulting a lawyer. This is because it will allow you to assess whether the threat of prosecution has a reasonable basis and actually creates a risk of criminal liability.


Full article is available in Polish here,

plpolski (Polish)

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