New forfeiture rules in Polish criminal law

On 27 April 2017 new laws on the so-called “extended confiscation” were introduced into the Polish legal system by the Act of 23 March 2017 on the amendment of the act  – Penal Code and certain other acts (The Journal of laws 2017, item 786).

The amendment aims to improve the efficiency of criminal law enforcement mechanisms that aim to deprive the offenders of the benefits of committing offences. Into the Polish criminal law, among others, the institution of corporate forfeiture (art. 44a of the Penal Code) and extended forfeiture (art 45 § 2), were introduced.

The legislator drew attention to the problem of the serious economic crimes committed by enterprises. So far, the fact that an enterprise did not constitute the perpetrator’s property prevented combating such crime. According to the view expressed in the reasons of the amendment’s project, perpetrators of serious offences, especially those committed in an organised manner, gather assets also from offences other than those that they are charged for. According to the legislator, this justified the legality of the property that was acquired also before the offence was committed.

New art. 44a of the Penal Code provides a basis for determining the forfeiture of an enterprise which is the property of the offender that was used to commit a crime or to conceal the benefit derived from it. This can also be imposed in relation to an enterprise not being in property of the offender if the owner of that enterprise knew that it was used for committing a crime and agreed to it. The term enterprise should be understood pursuant to art. 551 of the Polish Civil Code, thus as an organised set of tangible and intangible assets intended for carrying out an economic activity.

However, forfeiture of an enterprise is excluded when the benefit gained from an offence does not exceed 200.000 PLN, if it was not proportionate to the seriousness of the committed offences, or if the damage caused or the value of the hidden benefit is not significant in relation to the size of the business. The court may also exceptionally waive the forfeiture in relation to the owner of the enterprise if he is not the offender.

According to the current wording of the art. 45 § 2 of the Penal Code, the benefit gained out of the offence is assets that the offender has taken possession of or is entitled to in the period of 5 years before committing an offence, until the sentence is made even if it the sentence is invalid. This provision also contains the presumption which shifts the burden of proof of the legal origin of the property at risk of forfeiture or other person holding the property.

The use of the extended forfeiture was limited to convictions for:

  • an offence, from commitment of which, even indirectly, a financial advantage exceeding 200.000 PLN was gained, or
  • an offence, from commitment of which, even indirectly, a financial advantage was gained, imprisonment of no less than 5 years, or
  • an offence committed in an organised criminal group.