Misuse of company assets: article 476 of the Criminal Code

Article 476 of the new Criminal Code reaches the director in fact or in law of a private legal person. The offence lies in using the assets or the credit of that legal person for personal ends, with fraudulent intent. That use may be direct or indirect.

A second requirement of intent comes on top. The offender knew that this use significantly harmed the financial interests of the legal person. The same knowledge covers the interests of its creditors or members.

The prosecution therefore need not show that the director received the money himself. The statute names the credit of the legal person alongside its assets. It names indirect use alongside direct use.

The capacity of the offender is an element in its own right. Article 476 covers the director in fact as well as the director in law. The former article 492bis named the directors of civil and commercial companies and of non-profit associations. The new text speaks generally of a private legal person.

Facts from before 1 September 2026 remain governed by the former article 492bis. Article 2 of the new Criminal Code requires the provision most favourable to the offender. A file that runs across both periods is therefore read twice.

Article 476 sets a level 3 penalty. For a legal person, article 38 of the Criminal Code translates that level into a fine of more than 360,000 up to 600,000 euro. That is the figure in the statutory text. The Law of 5 March 1952 increases fines imposed since 1 September 2026 by 2.5 additional decimes. The final figure is therefore higher.

The fine is not the only sanction. Article 38 also provides for confiscation and closure of the establishment. It further provides for a ban on carrying out an activity that forms part of the object of the legal person. Article 57, first paragraph, sets that ban at one to ten years. Article 39 allows the court to order publication of the conviction.

The company and the director stand trial next to one another. The Law of 11 July 2018 abolished the rule that made the court choose between them. Article 18, third paragraph, confirms that the liability of the legal person does not exclude that of the director.

The prosecution sometimes targets both the company and its representative for the same facts. The competent court then appoints an ad hoc representative. That rule sits in article 2bis of the preliminary title of the Code of Criminal Procedure.

A file built on article 476 also puts the cap on directors’ liability in play. Article 2:57 of the Companies and Associations Code provides for five caps. They stand at 125,000 euro, 250,000 euro, 1 million euro, 3 million euro and 12 million euro. Which step applies depends on the turnover and the balance sheet total over the three financial years before the claim.

Article 2:57, § 3, 1°, switches that cap off for gross fault, fraudulent intent and intent to harm. Article 476 requires fraudulent intent. The cap is therefore itself in dispute in such a file.

Agreeing in advance that the company will indemnify its director does not help. Article 2:58 prohibits any prior exemption or indemnity granted by the legal person. A clause to the contrary counts as unwritten.

On bankruptcy, article XX.225 of the Code of Economic Law comes on top. A director can be held personally liable for the shortfall. That requires a manifestly gross fault that contributed to the bankruptcy.

The general meeting decides whether a company claim is brought against the members of the management body. Article 5:103 of the Companies and Associations Code governs this in a private limited company. Article 7:156 does the same in a public limited company.

Discharge does not always rule that claim out. In a private limited company, the discharge holds only where the annual accounts do not conceal the true situation. Operations contrary to the articles of association or to the code must also have been specifically stated in the notice of meeting. In a public limited company, article 7:149 requires those breaches on the agenda.

A minority shareholder can act for the account of the company. In a private limited company, article 5:104 requires at least 10 per cent of the shares issued on the day of the discharge. In a public limited company, article 7:157 requires at least 1 per cent of the votes. Securities representing capital worth at least 1,250,000 euro also qualify. A shareholder who validly approved the discharge loses that claim.

Where you cannot see the operations yourself, the president of the enterprise court can appoint experts in summary proceedings. They examine the books, the accounts and the operations of the company bodies. That requires indications that the interests of the company are seriously at risk. The president decides whether the report is published.

A claim against a director becomes time-barred after five years (article 2:143, § 1). The period runs from the operations, or from their discovery where they were deliberately concealed. A party that suffered damage can also bring a civil party claim before the investigating judge (article 63 of the Code of Criminal Procedure).

If you are defending against an allegation, the work starts with the file. We request access to the criminal file. We then build the criminal defence of the company around the elements the prosecution has to prove.

If you discover the misuse yourself, the route runs through the dispute between the shareholders and through recovery. We handle corporate disputes and damage recovery after fraud.

If you want to know the risk before any file exists, the criminal liability audit maps which offences reach your company. On an acquisition, criminal due diligence does the same work for the company you take over.

Only a director in fact or in law of a private legal person. Article 476 of the new Criminal Code names that capacity expressly as an element of the offence. The former article 492bis was drafted more narrowly. It named the directors of civil and commercial companies and of non-profit associations. The prosecution therefore has to prove that capacity, alongside the other elements.

No, article 476 requires four elements together. The first is fraudulent intent, the second the capacity of director in fact or in law. The third is the direct or indirect use of the assets or the credit of the legal person for personal ends. The fourth is knowledge that this use significantly harmed the financial interests of the legal person and of its creditors or members. If one element is missing, the conduct falls outside the provision.

A level 3 penalty. For a legal person, article 38 of the Criminal Code sets a fine for that level of more than 360,000 up to 600,000 euro. That figure comes from the statutory text and is not the final amount, because the Law of 5 March 1952 adds 2.5 decimes. Beyond the fine, article 38 provides for confiscation and closure of the establishment. It also provides for a ban on carrying out an activity that forms part of the object of the legal person.

Not always. Article 5:98, second paragraph, of the Companies and Associations Code sets two conditions in a private limited company. The annual accounts may not conceal the true situation, and the conflicting operations must have been specifically stated in the notice of meeting. Article 7:149, second paragraph, adds for a public limited company that those breaches must be on the agenda. A concealed operation therefore yields no valid discharge.

Yes, through the president of the enterprise court sitting in summary proceedings. Article 5:106 requires at least 10 per cent of the shares issued in a private limited company. Article 7:160 requires at least 1 per cent of the votes in a public limited company, or securities worth at least 1,250,000 euro. There must be indications that the interests of the company are seriously at risk. The president decides whether the expert report is published.