For the 3rd Division of the Superior Court of Brazil (STJ), the absorption by merger of a company that had been accused of an environmental crime will lead to the extinction of its punishability. Applying the principle of the non-transferability of punishment, hence, criminal liability cannot be shifted to the acquiring company.
In the leading case involving this discussion, the legal entity, having acquired another that was facing criminal prosecution for pollution in the waste disposal, was seeking exoneration from the acquired company’s penalties.
The Court ruled in favor of the acquirer on the grounds that, by analogy, Article 107, item I, of the Criminal Code – an accused person’s death extinguishes his/her punishability – shall apply. According to the presiding judge, Justice Ribeiro Dantas, as a company absorption by merger results in the extinction of the absorbed company, the situation is analogous to the death of an individual and shall, for equality reasons, lead to the same result.
This decision, however, was not unanimous. Other justices understand it is not possible to equate the death of an individual to a legal entity’s extinction, arguing that this would only come to pass in cases of a company’s dissolution and liquidation. They held that when a company is incorporated by another, it continues to exist through the entity of the acquiring company. Furthermore, they deem an acquisition to be a reversible act, thus, not comparable to the death of an individual.
Fonte: ConJur
