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Introduction

In recent years, Lebanese commercial law has undergone significant changes to address emerging financial crimes. The new Lebanese Commercial Law No. 126, dated March 29, 2019, introduces several provisions aimed at safeguarding companies from malicious activities. This blog post will delve into two key financial crimes outlined in the law: intentional harm to the company and concealment of the company’s true financial status.

Intentional Harm to the Company

Article 253 (1) of the new law establishes penalties for individuals who intentionally damage the company. This includes:

• Misuse of Company Funds: Using the company’s funds or credit capabilities for personal gain, which adversely affects the company’s interests.
• Conflict of Interest: Working for another company, institution, or individual that has a direct or indirect interest conflicting with the company’s interests.

Penalties: Offenders, including the chairman, board members, directors, and authorized signatories, face imprisonment from three months to three years and fines ranging from 25 to 100 times the minimum official wage.

Concealment of the Company’s True Financial Status

Article 253 (2) addresses the crime of concealing the company’s true financial status. This involves:

• False Financial Statements: Intentionally organizing and publishing inaccurate financial statements to hide the company’s actual financial condition.
• Auditor Complicity: Auditors who intentionally conceal violations in their reports are also subject to penalties.

Penalties: Similar to the previous crime, offenders face imprisonment from three months to three years and fines ranging from 25 to 50 times the minimum official wage.

Statute of Limitations

Article 253 (3) specifies the statute of limitations for prosecuting these crimes:

• Visible Crimes: The three-year limitation period starts from the date of the crime.
• Hidden Crimes: If the crime was concealed, the limitation period starts from the date of discovery.

Conclusion

The amendments to Lebanese commercial law reflect a robust approach to combating financial crimes within companies. By understanding these provisions, company leaders can better navigate legal responsibilities and protect their organizations from malicious activities.