In the Dominican Republic, as well as internationally, it had long been widely accepted that legal entities did not bear criminal liability. This position was consistently upheld by both the Supreme Court of Justice and later by the Constitutional Court, which maintained that \u201clegal entities cannot be held criminally liable\u201d and that \u201ccriminal offenses are always attributable to an individual, namely a natural person.\u201d This reality has now changed.<\/p>\n\n\n\n
The emerging global trend is to establish criminal liability for legal entities, driven in part by the enactment of Law No. 155-17 on Anti-Money Laundering and Counter-Terrorism Financing. Article 8 of this law contemplates the imposition of sanctions on legal entities, including fines, closure of premises, restrictions on commercial activities, revocation of licenses, and even dissolution.<\/p>\n\n\n\n
With the enactment of Law No. 74-25 on August 3, 2025\u2014introducing the new Criminal Code\u2014criminal liability for legal entities has become a binding reality that all companies operating in the country must assume. Pursuant to Article 393, businesses have a five-month period to implement the necessary measures to protect themselves from potential criminal prosecution.<\/p>\n\n\n\n
The urgency of this transition cannot be overstated. The new Criminal Code not only contemplates sanctions such as business closure or dissolution, but also establishes fines of up to 1,500 public sector minimum wages\u2014currently equivalent to approximately DOP 15 million. Given that the public sector minimum wage has not been adjusted since 2019, an increase is anticipated, which would consequently raise the applicable penalties.<\/p>\n\n\n\n
The new Criminal Code further expands on corporate criminal liability. As set forth in Article 8, legal entities will be held criminally liable when acts or omissions committed by their representatives or subordinates result from a failure to comply with duties of direction, control, and supervision.<\/p>\n\n\n\n
Additionally, Paragraph II of Article 8 provides that criminal liability may be mitigated or subject to alternative resolutions if the company can demonstrate the existence of measurable, enforceable, and verifiable compliance programs, policies, and controls. This is precisely where Compliance becomes critical.<\/p>\n\n\n\n
Broadly defined, Compliance is an independent function within an organization responsible for identifying, advising on, monitoring, and reporting compliance risks, while fostering a culture of integrity and accountability across all levels of the organization. It is important to note that Compliance is inherently contextual; a multinational banking institution will not have the same compliance framework as a local company dedicated to consumer goods distribution.<\/p>\n\n\n\n
Each business faces unique risks, and even within the same industry, organizations have distinct vulnerabilities that must be proactively identified and addressed to prevent exposure to sanctions and irreversible reputational damage.<\/p>\n\n\n\n
Paragraph III of Article 8 establishes two conditions under which duties of direction, control, and supervision are deemed fulfilled when violations occur fraudulently: (i) when compliance programs have been circumvented despite being properly implemented, provided that management reports the incident in a timely manner upon becoming aware; or (ii) when the violation is committed by an individual outside the scope of management\u2019s control, making it impossible for management to have prior knowledge.<\/p>\n\n\n\n
Furthermore, Paragraph IV outlines the minimum components required in a corporate compliance program, including: (i) clear identification of risk areas; (ii) the existence of an autonomous function responsible for oversight and implementation; (iii) defined protocols and disciplinary measures for addressing violations; and (iv) periodic review and adaptation of the program in response to operational or regulatory changes.<\/p>\n\n\n\n
Ultimately, 2026 marks a pivotal shift in corporate accountability. In the face of any criminal offense, the central question will be: what measures did the company take to prevent it? Compliance will no longer be a peripheral or symbolic element, but rather the foundation upon which business continuity must be built.<\/p>\n\n\n\n
Effective Compliance cannot be achieved overnight. It requires the development of an organizational culture embedded at every level, supported by continuous monitoring, refinement, and alignment with the company\u2019s operational reality. Accordingly, the time to act and strengthen the protection and resilience of your organization is now.<\/p>\n","protected":false},"excerpt":{"rendered":"
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