作者

Dr. Rebekka Krause

授薪合伙人

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Dr. Dirk Lorenz

合伙人

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Dr. Jonas Woitzyk, LL.M. (Auckland)

授薪合伙人

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作者

Dr. Rebekka Krause

授薪合伙人

Read More

Dr. Dirk Lorenz

合伙人

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Dr. Jonas Woitzyk, LL.M. (Auckland)

授薪合伙人

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2022年4月26日

Corporate Compliance @ Tech Deals – 8 / 8 观点

Corporate Compliance @ Tech Deals – the Siemens/Neubürger decision revisited

  • Briefing

The foundation of corporate compliance culture in Germany is considered to be the Siemens/Neubürger decision of the 5th Chamber for Commercial Matters of the Munich I Regional Court dated 10 December 2013 (5 HK O 1387/10), which dealt with the Siemens corruption scandal. With the exception of some special legal regulations in the financial sector, there is still no general legal regulation of compliance requirements for companies (see also our article dated 8 March 2022: Compliance management systems and the perpetual question of “what is appropriate”?). Even after more than eight years, the Siemens/Neubürger decision has not lost its relevance and clearly sets out the scope of compliance obligations. We now summarise the continuing relevance of the Court’s statements for current practice.

Facts of the case

Siemens AG claimed damages from its former chief financial officer in the amount of EUR 15 million, essentially claiming that “the defendant (Neubürger) had breached his board duties to ensure lawful conduct of the company and its employees. He had not ensured that the plaintiff (Siemens AG) had an efficient compliance system which was actually applied and controlled. Despite repeated indications of serious breaches of compliance regulations brought to his attention, the defendant did not take any measures or sufficient measures to clarify and investigate the breaches, to put an end to breaches and to punish the employees concerned”. The Chamber of the Regional Court, chaired by Dr Helmut Krenek, upheld the claim and affirmed the liability of the executive board under section 93 (2) sentence 1 German Stock Corporation Act.

The compliance principles set down in the decision

The first two principles of the decision of 10.12.2013 according to the publication in NZG 2014, 345 read as follow: 

“1. Within the scope of his duty of legality, a member of the executive board must ensure that the company is organised and supervised in such a way that no violations of the law occur, such as bribe payments to public officials of a foreign state or to foreign private persons. In the event of a corresponding risk situation, a member of the executive board only fulfils his organisational duty if he establishes a compliance organisation based on damage prevention and risk control. Decisive for the scope are the type, size and organisation of the company, the regulations to be observed, the geographical presence as well as suspicious cases from the past.

2. Adherence to the principle of legality and, accordingly, the establishment of a functioning compliance system is part of the overall responsibility of the executive board.”

Compliance as an overall responsibility of the executive board

Based on the second principle, it is clear that compliance is the overall responsibility of the executive board. No member of the executive board can refer to any compliance responsibility of another colleague on the executive board. The objection of an individual board member that the board did not follow his ideas and proposals does not exonerate him either. “If a member of the executive board (...) should indeed not have got through to his colleagues on the executive board with proposals for improving the compliance organisation, he shall raise corresponding counter-proposals with his colleagues and, if necessary, call in the supervisory board.”

Creation of clear responsibilities and authority

The decision provides for an obligation to create a clear regulation of the main responsibility for compliance matters in the executive board. In addition, at the management level below the executive board, responsible employees (e.g. in the person of the compliance officer) must be given the authority to issue disciplinary measures. This is to be flanked by a clear reporting chain. In the Neubürger case, the court also demanded a review of all external contracts, especially consultancy contracts, which gave rise to the assumption of corruption.

Risk-based approach

The Regional Court sets down the clear foundation of an appropriate compliance organisation. In the opinion of the Chamber, the compliance system must be adapted to the operational practice of the company in such a way that, for example, special monitoring mechanisms must be established for economic activities of the company in countries susceptible to corruption or also for IPOs abroad. The decision therefore follows a case-by-case, risk-based approach: The intensity of the compliance requirements depends on the degree of risk potential. If, as in the case at hand, this has been realised through already known bribery payments, increased compliance requirements are to be imposed.

Implementation and regular review

The executive board is not only obliged to implement an efficient compliance system, it must also regularly review its effectiveness. For example, the executive board is obliged “to be informed at regular intervals about the results of internal investigations, whether personnel consequences have been pursued and, above all, whether and how a system behind it is operating effectively. In this way, monitoring of the suitability of the compliance system can be achieved.

Lessons Learned – clarify, cease, sanction

Even after more than eight years, the Siemens/Neubürger decision of the Munich I Regional Court is still considered ground-breaking for compliance culture in companies, as it describes the essential aspects of compliance obligations in a practical and still up-to-date way. As Professor Fleischer rightly summarises in his commentary on the ruling in NZG 2014, 321, “it becomes emphatically clear that it is not enough to merely set up a compliance system, but that the fulfilment of compliance responsibility is an ongoing task for the executive board. Special care must be taken in the event of suspicious circumstances and violations in the company. Immediate action is then required in accordance with the three-way principle of “clarify, cease, sanction” under company law.”

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