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Determining nationality of corporations is tricky
The fundamental problem remains simple: what criminal law should be applied to corporations?
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What criminal law should be applied to corporations? (Shutterstock/File)
T
he idea of penalizing corporations for crimes they committed is not a novel notion in foreign criminal legal systems. In fact, certain countries, such as the United States and the United Kingdom have already implemented corporate criminal liability through the infamous Foreign Corrupt Practices Act (FCPA) and UK Bribery Act since 1900s.
However, such an idea has not yet been incorporated into the Indonesian legal system, as the dull and rusty Criminal Code does not provide any hint that a legal person may be put in jail.
Nonetheless, as corporations are increasingly implicated in various corporate crimes (specifically white-collar crimes such as bribery, corruption, money-laundering, environmental damage, banking fraud, etc.), the Indonesian judiciary has been pushed to stipulate the procedural law for prosecuting law-breaking corporations in light of deterrent effects and significantly larger fines.
Hence, the Supreme Court has finally issued Regulation No. 13 of 2016 on Procedures to Settle Criminal Acts Committed by Corporations (SC Regulation) with the aim of prosecuting corporations, instead of their corporate organs alone, as the perpetrators of corporate crimes.
The SC Regulation strives to criminally entangle any parties involved in the corporate crimes, including holding and affiliation relationships of corporations, as well as the corporate organs and controllers of such corporations.
A set of rather ambitious and ground-breaking rules if the regulation is properly implemented. Nevertheless, the fundamental problem remains simple: what criminal law should be applied to corporations?
Determining which criminal law prevails in cases implicating corporations is as simple as considering where the criminal acts have been committed, as commonly known as the territoriality principle as stated in the Criminal Code.
