The “Dilemma” of Criminal Compliance for Multinational Enterprises in a Fragmented Legal World

Abstract

This paper deals with the need for a specific legal analysis, from a criminal law perspective, concerning multinational enterprises (MNEs), given their involvement in illicit conducts that transcend the territorial boundaries of any single State and generate negative effects of enormous dimensions. The topic presents a high degree of complexity in terms of territorial and material scope: indeed, MNEs face a “dilemma” between undercompliance and overcompliance, since even the most cooperative entity, honestly seeking to fulfil its legal duties, is confronted with a fragmented and uncoordinated legal and regulatory scene. The risk thus arises of setting an insufficient standard for compliance, or vice versa, making an effort that is counterproductive in terms of efficiency while being supererogatory from the legal point of view. The present analysis thus addresses how MNEs might strike the right balance in combining the different sets of regulations, first of all by fulfilling the requirements applicable in the "home country" as well as those applicable in the "host country": to do this, the need arises for an MNE to compare the legislative requirements it has to abide by under the legislation applicable to the mother company and the ones applicable to the foreign entities it controls. A further layer of complexity relates to the extensive reach of certain pieces of criminal legislation issued by “third countries,” especially concerning anticorruption policies. Moreover, other emerging elements have to be taken into account by MNEs: on the one hand, private bodies and organizations increasingly define the compliance standards, the main example being represented by the ISO standards; on the other, international or transnational soft law and hard law rules are in the process of being elaborated, as the field of human rights clearly shows. In conclusion, the analysis reveals a progressive tendency among MNEs to comply with the higher legal standards set in home countries or at the international level, instead of the lower ones provided at the local level. Yet this tendency is far from general and admits a large number of exceptions, in particular where the procedural and institutional dimensions of compliance rules are concerned.