White Collar Crime Comparative Guide

1 Legal and enforcement framework

1.1 Which legislative and regulatory provisions govern white collar crime in your jurisdiction?

White collar crime is generally regulated by the Criminal Code – most notably its section on economic crimes and crimes against property. Other relevant white collar crimes are scattered across various legislative instruments, such as:

• the Tax Procedure;
• the Competition Protection Law;
• the Public Procurement Law;
• the Anti-corruption Law;
• the Anti-money Laundering and Prevention of Terrorist Financing Law;
• the Customs Law;
• the Capital Markets Law;
• the Law on Banks;
• the Audit Law;
• the Law on Accounting; and
• the Environment Protection Law.

In Serbia, some white collar crimes are prosecuted by different regulators. However, these crimes are not crimes stricto sensu, but rather so-called 'commercial offences', and are sometimes prosecuted in parallel with the criminal case. For example, in case of breach of the Protection of Competition Act, the Commission for the Protection of Competition can impose monetary fines of up to 10% of the total annual income of the respective undertaking. Also, the Tax Authority can impose very harsh monetary penalties and has very extensive powers in relation to tax audits.

1.2 Which bilateral and multilateral instruments of relevance to white collar crime have effect in your jurisdiction?

Various multilateral instruments are applicable in Serbia. Serbia has signed and ratified:

• the United Nations Convention against Corruption; and
• the Council of Europe Convention (Criminal and Civil) on Corruption.

All of these conventions came into force by a special decree and thus became part of the legal system of Serbia; however, they have not yet been fully implemented.

Various conventions relating to mutual legal assistance and extradition are also applicable in Serbia, such as the 1957 Council of Europe Convention on Extradition. In extradition cases when there is no treaty, the domestic legislation on mutual legal assistance in criminal matters will apply. However, the courts – even in cases when there is a ratified treaty – often give precedence to domestic legislation, leaving the precise scope of application of the treaty subject to case-by-case determination by a presiding judge.

Serbia is also no stranger to the extraterritorial application of:

• the US Foreign Corrupt Practices Act; and
• to a lesser extent, according to the practice so far, the UK Bribery Act.

Recent years have seen investigations and subsequent deferred prosecution agreements in relation to bribery allegations concerning several multinational pharmaceutical companies. Bribery and trading in influence also extend to foreign officials, meaning that a foreign official who has committed an offence will be liable under the same regime as a domestic official.

1.3 Which bodies are responsible for enforcing the applicable laws and regulations? What powers do they have?

Primary enforcement lies with the public prosecutors' offices, which are classified as follows:

• the basic public prosecutors' offices;
• the higher public prosecutors' offices;
• the appellate public prosecutors' offices;
• the Republic Public Prosecutor's Office; and
• the Special Public Prosecutor's Office, which handles organised crime cases, a substantial number of which involve business crimes.

There is also a specialised unit for combating corruption within the Higher Public Prosecutor's Office in Belgrade. White collar crimes are usually initially prosecuted by various enforcement agencies, such as:

• the Tax Administration;
• the Securities Commission;
• the Commission for Protection of Competition;
• the Public Procurement Directorate;
• the Anti-money Laundering Directorate;
• the Tax Police;
• the Customs Administration;
• the National Bank of Serbia;
• the Business Registers Agency;
• the Central Securities Depository;
• the Privatisation Agency;
• the State Audit Institution;
• the Cadastre;
• the Аnti-corruption Agency;
• the Pension Fund;
• the Property Directorate; and
• other state bodies in charge of enforcement of sectoral laws, such as the Environmental Protection Agency.

1.4 What is the general approach of the authorities in enforcing the applicable laws and regulations?

The main principle is the principle of legality, meaning that the public prosecutor must conduct criminal prosecution where there are grounds to suspect that:

• an individual prosecutable criminal offence has been committed; or
• a certain person has committed a criminal offence which is prosecutable ex officio.

However, in practice, there is no unified way of approaching the enforcement of white collar crimes and the general sense is that there is no one arm's-length approach when dealing with white collar crime. For example, while the new Law on Corruption Prevention – like its predecessor – focuses mainly on corruption in the public sector, its application varies in practice, in line with initial concerns raised by stakeholders such as Transparency International and the wider public.

Usually, crimes are investigated and prosecuted based on the type and severity of the offence. In principle, parallel investigations by other authorities are possible to the extent that these cover different types of offences within the same factual situation. However, due to recent organisational and structural changes in the prosecution of business crimes – which have resulted, among other things, in the introduction of liaison officers to serve as a point of contact with the public prosecutor's offices, the police and other authorities – parallel investigations are now winding down.

In addition, the initial idea behind the Financial Investigation Strategy from 2015 was to:

• address the problem of financial crime by facilitating efficient and effective financial investigations;
• keep track of money flows and assets; and
• facilitate the proactive identification of criminal offences.

However, the strategy ended with mixed results and no new strategy has been proposed.

2 Scope of application,

2.1 Can both individuals and companies be prosecuted under the white collar crime laws? Under what circumstances are employees' actions attributable to the company?

Yes, both individuals and companies can be prosecuted under the laws on white collar crime. However, thus far, most prosecutions have focused on natural persons – even in cases where the unlawful act could have been attributed to the legal person due to the identification doctrine. Under this doctrine, the criminal mind of the legal person is actually the criminal mind of an individual who:

• holds a controlling position in the legal person; or
• exercises supervisory duties.

Holding a company liable for a criminal offence in Serbia does not exclude the responsibility of natural persons; it means only that, in addition to the individual liability of officers and employees, there exists a complementary company liability. Therefore, the prosecuting authority always has wide discretion to prosecute individuals, companies or both. This is decided on a case-by-case basis, depending on the circumstances, as the application of the legality principle to legal persons is not clearly defined in law.

The legality principle establishes an obligation to prosecute where there are grounds to suspect that:

• an individual prosecutable criminal offence has been committed; or
• a certain person has committed a criminal offence which is prosecutable ex officio.

While there should be no doubt that the legality principle is applicable to legal persons, its application is not clearly articulated.

A company can be held liable if:

• a responsible person, acting within his or her authority, culpably commits a criminal offence with the intention of obtaining benefits for the company; or
• a person acting under the control or supervision of a responsible person was enabled to commit a criminal offence due to the lack of supervision or control of the decision-maker.

2.2 Can foreign companies be prosecuted under the white collar crime laws?

Yes:

• The corporate criminal liability regime is also applicable to foreign legal entities that are responsible for a criminal offence committed in the Serbian territory; and
• A foreign legal entity can be liable for a criminal offence committed abroad to the detriment of Serbia, a Serbian citizen or a domestic legal entity.

2.3 Can successor companies be prosecuted under the white collar crime laws?

Yes. From a criminal (penal) law perspective, the situation in an acquisition context is clear: the acquirer will face successor liability in case of past wrongdoings of a target. This is more or less in line with the practice of the European Court of Human Rights, confirming that imposition of fines on the acquiring company for breaches of competition rules committed by the acquired company prior to the merger did not infringe the principle of the personal nature of penalties.

In case of a merger, the situation is not so clearcut, but the successor may assume certain liabilities – although it is unlikely that it could assume criminal liability. In any case, the parties should conduct a detailed analysis of the proposed transaction.

In addition, a distinction should be made between share deals and asset deals. In an asset deal, criminal liability generally cannot be transferred to the acquirer. However, an action relating to certain environmental, social and governance (ESG) offences could be brought against the acquirer in case of the acquisition of certain assets (ie, old privatised factories, machinery or land), where those assets subsequently (ie, post-transaction) have an impact on the environment or people. In such cases, a specific warning should be issued during the due diligence to encompass the ESG aspects of the proposed transaction.

2.4 Do the white collar crime laws have extraterritorial reach?

Generally, the Serbian white collar crime laws rarely have such reach, unlike the US Foreign Corrupt Practices Act or the UK Bribery Act. However, in cross-border cases, the public prosecutor can conduct certain activities where it requests assistance from the enforcement agency in the host state. Various Council of Europe conventions (eg, the European Convention on Mutual Assistance in Criminal Matters) further provide a basis for evidentiary action to be taken abroad. These multilateral instruments are gaining significance due to various judicial capacity-building programmes in Serbia.

3 Offences

3.1 What types of white collar crimes are recognised in your jurisdiction and what do they involve?

White collar crimes are generally regulated by the Criminal Code – most notably the sections on economic crimes and crimes against property. Other relevant white collar crimes are scattered across various legislative instruments, such as:

• the Tax Procedure;
• the Competition Protection Law;
• the Public Procurement Law;
• the Anti-corruption Law;
• the Anti-money Laundering and Prevention of Terrorist Financing Law;
• the Customs Law;
• the Capital Markets Law;
• the Law on Banks;
• the Audit Law;
• the Law on Accounting; and
• the Environment Protection Law.

The main white collar crimes in Serbia are as follows:

• Active bribery: Bribing public officials or employees, agents or shareholders/owners of private companies to induce them to act, or not act, contrary to or in accordance with their duties.
• Passive bribery: Where public officials or employees, agents or shareholders/owners of private companies accept advantages in exchange for an act, or the omission of an act, contrary to or in accordance with their duties.
• Trading in influence: Where someone:
• • solicits or accepts, either directly or through a third party, a reward or any other benefit for himself or herself or another in order to use his or her official or social position, or real or assumed influence, to intercede for the performance or non-performance of an act; or
  • makes a promise or an offer, or gives to another either directly or through a third party, a reward or any other benefit so that the recipient might use his or her official or social position, or real or assumed influence, to intercede for the performance or non-performance of an official act.
• Embezzlement: An unlawful gain of movables entrusted to a person who holds an official position in a government or a person in a company.
• Criminal anti-competitive behaviour: Where a person in a company enters into a restrictive agreement (including a cartel), which is not exempted under the competition legislation, and fixes prices, limits production or sales or divides markets. Such a person can theoretically be exempted from punishment (albeit with a guilty verdict) if he or she satisfies the conditions for leniency under the competition legislation; however, it remains to be seen how this will work in practice, given the possibility of plea bargaining under the Criminal Procedure Code. The solution might be to include all of the leniency conditions in the agreement concluded with the public prosecutor.
• Market manipulation: This crime takes several forms. These mostly relate to causing damage through:
• • transactions or orders to trade which give, or are likely to give, false or misleading signals as to the supply of, demand for or price of financial instruments, or which secure, by a person or persons acting in collaboration, the price of one or several financial instruments at an artificial level;
  • transactions or orders to trade which employ fictitious devices or any other form of deception or contrivance; and
  • dissemination of information through the media – including the Internet – or by any other means which gives, or is likely to give, false or misleading signals as to financial instruments, where the person who made the dissemination knew or ought to have known that the information was false or misleading.
• Money laundering: Where a person:
• • converts or transfers property while aware that such property originates from a criminal offence with the intent to conceal or misrepresent the unlawful origin of the property;
  • conceals and misrepresents facts on the property while aware that such property originates from a criminal offence; or
  • obtains, keeps or uses property in the knowledge, at the time of receipt, that such property originates from a criminal offence.
• Tax evasion: Tax crimes are covered in both the Criminal Code and the Tax Procedure. They all involve tax evasion in some form or another – that is, the intent to conceal a certain significant fact that could be important in determining one's tax obligations for the purposes of avoiding tax.
• Abuse of position by a responsible person: Where a person abuses his or her position or powers, exceeds his or her powers or fails to discharge his or her duty in order to:
• • obtain unlawful material gain for himself or herself, or for another natural person or legal entity; or
  • causes material damage to another.
• Fraud in conducting business activity: Where a person, with the intention of obtaining an unlawful material gain for himself or herself, or for another person, misleads somebody in the conduct of business by false presentation, the concealment of facts or false conviction, and thus leads that other person to do something or not do something which damages the assets of a business entity for which or with which that other person works, or of another legal entity.
• Environmental crimes: Among others, these include:
• • environmental pollution;
  • failure to undertake environmental protection measures;
  • illegal construction and operation of facilities and installations that pollute the environment;
  • damage to environmental protection facilities and installations;
  • destruction or damage to the environment;
  • export or import of a 'protected natural asset'; and
  • unlawful processing, depositing, stockpiling or import of dangerous substances.

The mental element can also be negligence.

3.2 How are predicate offences defined in your jurisdiction?

Basically, any offence can be considered as a predicate offence – that is, an offence whose proceeds may become the subject of a money-laundering offence. The current trend is to apply the anti-money-laundering provisions to the widest range of predicate offences, which results in a general tendency to reverse the burden of proof, prejudicing the innocence of defendants and impacting fundamental and defence rights.

3.3 Do any restrictions or thresholds (eg, in terms of parties, asset type or transaction value) serve to limit the types of activities that constitute white collar crimes?

No, there are no restrictions or thresholds in terms of parties, asset type or transaction value that serve to limit the types of activities that constitute white collar crimes.

3.4 What are the most common offences for which company directors and officers can be held personally liable?

Please see question 3.1.

4 Compliance

4.1 Is the implementation of a compliance programme a regulatory requirement in your jurisdiction? If so, what should this cover?

No, the implementation of a compliance programme is not a regulatory requirement in Serbia. However, any compliance programme will be considered when determining the punishment within the limits for the particular offence and will serve as a mitigating factor. When imposing a fine, the court will take into account any measures (eg, a compliance programme) taken by the legal entity in order to prevent and detect the criminal offence.

4.2 Does failure to implement an adequate compliance programme constitute a regulatory and/or criminal violation in your jurisdiction?

No, please see question 4.1.

4.3 What due diligence requirements apply in relation to customers, partners, suppliers etc?

Currently, there are no direct legal provisions in Serbia that impose due diligence requirements apart from certain general provisions in the Law on Accounting, which applies only to companies with more than 500 employees. However, the actual application and enforcement of these regulatory initiatives in Serbia is still under review. The Law on Accounting mandates companies to report on environmental, social and governance (ESG) processes, including due diligence, to make them accountable and legally responsible for providing non-financial (sustainability) ESG information. In order to make proper ESG disclosures and produce a non-financial ESG report, companies must first establish relevant ESG practices and procedures – including a due diligence procedure – to underpin these disclosures. Currently, there are no indications that a greater number of companies in Serbia are reporting on their due diligence procedures, which suggests that they do not have these procedures at all.

However, a company's responsibility can be triggered by a third party – such as a supplier, partner or agent – under very narrow and specific circumstances. If that third party acted under the control or supervision of a responsible person (decision maker) within the company and a lack of supervision enabled that third party to commit a criminal offence, the company will be liable. For this reason, it is important to establish a proper due diligence procedure that goes beyond merely meeting the reporting requirements under the law.

4.4 What books and records requirements apply in this context?

Currently, there are no direct requirements on keeping books and records in the context of due diligence obligations relating to customers, partners, suppliers and similar. However, in order to maintain proper oversight of third parties and mitigate possible liability, companies should keep track of all third-party dealings in their books and records.

4.5 What other compliance best practices should a company implement to mitigate the risk of white collar crime?

Most critically, companies should develop a compliance programme. Where an offence is discovered, a compliance programme will be considered by the court when determining the punishment within the limits for the particular offence and will serve as a mitigating factor. When imposing a fine, the court will take into account any measure (eg, a compliance programme) taken by the legal entity in order to prevent and detect the criminal offence.

In addition, a company can be exempted from punishment if it voluntarily and immediately takes all necessary actions to remedy harmful effects or returns unlawfully obtained property. A company may also be exonerated from punishment if:

• it detects and reports a criminal offence before learning that criminal proceedings have been instituted; or
• on a voluntary basis or without delay, it removes incurred detrimental consequences or returns the proceeds from crime unlawfully gained.

One of the measures for detecting a criminal offence is an internal investigation.

4.6 Must companies report financial irregularities or actual or potential violations?

Yes, but only if the failure to report would constitute a separate criminal offence – that is, if:

• the company knew that preparations to commit a criminal offence (punishable by imprisonment for five or more years) were underway but failed to report this at the time (when its commission could have still been prevented); and
• the offence is subsequently committed or attempted.

4.7 What factors will the authorities consider in assessing the adequacy of a compliance programme?

The authorities are not required to consider and assess the adequacy of a compliance programme. However, a compliance programme will be considered when determining the applicable punishment within the limits of the particular offence and will serve as a mitigating factor.

5 Investigations

5.1 How are investigations typically commenced in your jurisdiction?

Cases are initiated by a criminal complaint and can be initiated by anyone with information on the crime. Strictly formally, proceedings begin only when the public prosecutor, based on initial information and findings, decides to open an investigation.

Investigations are usually commenced once there are grounds for suspicion that a specific person has committed a criminal offence which is prosecutable ex officio. An investigation can also be initiated against an unknown perpetrator when there are grounds to suspect that a criminal offence has been committed. During the investigation, the following are collected:

• evidence and data needed to decide whether to:
• • file an indictment;
  • discontinue the investigation; or
  • not prosecute the defendant; and
• evidence which it might not be possible to reproduce or whose examination would be hampered at trial.

5.2 What investigative powers do the authorities have?

There are various investigative powers vested in the prosecution, which include both:

• traditional powers, such as:
• • interviewing suspects and witnesses;
  • obtaining biometric/biological/genetic samples;
  • examining accounts and suspicious transactions; and
  • searching premises; and
• more advanced powers, such as:
• • covertly intercepting communications;
  • searching computers;
  • covertly conducting surveillance and making audio and video recordings; and
  • orchestrating simulated business deals.

5.3 Can the authorities demand that a company under investigation produce documents? When can the authorities search the premises and seize documents of a company under investigation

Yes, usually documents are seized when premises are searched (ie, a dawn raid). The search may be conducted on the basis of a warrant or exceptionally without one, if it is probable that the search will result in finding:

• the defendant;
• traces of the criminal offence; or
• objects of importance to the proceedings.

A receipt for seized objects is issued immediately to the person from whom the objects are seized. The police must take a record of the search and the persons present at the search have the right to enter remarks in the record.

In the case of competition law infringements, the authorities can:

• enter and check business premises, vehicles, land and other premises at the seat of the party and other places where the party or another person performs business and other activities;
• inspect business and other documents, regardless of the manner in which these are stored;
• repossess, photocopy or scan business documentation or, if this is not possible for technical reasons, repossess the business documentation and keep it for such time as is necessary to make copies thereof;
• seal business premises and business documents for the duration of the investigation;
• take oral or written statements from the representative of the party or its employees, as well as documents on the facts that are the subject of the investigation (if a written statement is necessary, the authorised official must set a date by which this statement must be delivered); and
• perform all other actions that are in accordance with the objective of the procedure.

5.4 Do the authorities typically cooperate with their foreign counterparts in conducting an investigation? If so, what is the process for doing so?

Yes, in cross-border cases – usually under bilateral or multilateral mutual legal assistance treaties – the public prosecution requests assistance from the enforcement agency of the host state (requested state) to perform certain investigative actions. Various Council of Europe conventions (eg, the European Convention on Mutual Assistance in Criminal Matters) provide the basis for certain evidentiary actions set out in the Criminal Code to be taken abroad. These multilateral instruments are gaining significance due to various judicial capacity-building programmes in Serbia.

5.5 What rights do companies and their directors and officers have during an investigation (eg, in relation to interviews/privacy and data protection)?

All protections guaranteed by Article 6 (right to a fair trial) of the European Convention on Human Rights can be invoked during questioning, including:

• the right to representation by an attorney;
• the privilege against self-incrimination (ie, the right not to say anything or to refrain from answering a certain question);
• the right to free presentation of a defence;
• the right to admit or not to admit culpability; and
• the right to read the case files immediately before the first interrogation (ie, the criminal complaint), the crime scene report and the findings and opinions of any expert witnesses.

5.6 What rules govern attorney-client privilege in your jurisdiction and what are their implications in the context of white collar crime investigations?

Legal privilege is a somewhat unusual concept in Serbia. The law includes no specific requirement that all communications between lawyer and client be regarded as privileged and thus not subject to disclosure. These communications should be protected in principle, but there are no mechanisms to prevent the authorities from obtaining this information and potentially using it as a reference for directing the case. This also applies to reports and interviews – although such evidence cannot be used in proceedings and, consequently, a court decision cannot be based on it. To this end, in preliminary proceedings the judge can issue a ruling to exclude such evidence from the file immediately or by no later than the conclusion of the investigation.

The personal data of employees is protected from unauthorised access by third parties, provided that such access relates to labour rights and obligations. Therefore, if an employee is under criminal investigation, he or she cannot rely on the provisions of the Labour Act.

5.7 What factors will the authorities consider in assessing whether to bring charges?

Once the investigation has concluded, the public prosecutor will file an indictment if there is a justified suspicion that a certain person has committed a criminal offence. This basically means that there should be sufficient inculpatory evidence in the case file following the investigative phase.

6 Enforcement

6.1 What is the structure of the criminal courts in your jurisdiction?

The structure of the criminal courts in Serbia is similar to that of the public prosecutors' offices and basically depends on the severity of the crime and, to some extent, the type. For example, the basic courts have jurisdiction over crimes that are punishable by a monetary fine or a sentence not exceeding 10 years. Generally, there are no specialised courts for particular crimes; however, there are specialised chambers with the Higher Court for:

• war crimes;
• organised crime (including business crimes); and
• the suppression of corruption.

According to the Criminal Procedure Code, an 'organised crime group' is a group of more than three persons who jointly consent to commit crimes in order to obtain material gains.

6.2 Are white collar crimes tried by jury in your jurisdiction?

There is no right to a jury in business crime trials, as seen in typical common law systems. Citizens can make a contribution to these trials only as so-called 'lay judges', who participate in them at first instance (with one exception at second instance) and have the right to:

• ask questions;
• give their opinions; and
• participate in the deliberation of the judgment.

However, the final say rests with the professional judge, who signs and is accountable for rendering the judgment.

6.3 What is the statute of limitations for prosecuting white collar crime in your jurisdiction?

The statute of limitations begins to run when the criminal act is completed. The limitation period itself varies depending on the sentence prescribed for each crime.

The limitation period can start to run again with every act of the prosecuting authority; however, there is a so-called 'absolute' limitation period, which is double the limitation period prescribed for the relevant crime. Once this absolute limitation period has expired, no prosecution is possible.

6.4 Can parties that voluntarily report white collar crime or cooperate with investigations benefit from leniency in your jurisdiction?

Self-reporting is mostly relevant in cases of active bribery, meaning that a perpetrator who reports an offence before becoming aware that it has been detected may be exempted from punishment. In other cases, the court may also exempt from punishment the perpetrator of a criminal offence which is punishable by imprisonment for up to five years if the offender:

• reports the offence following its commission but before learning that it has been discovered; and
• remedies the consequences of the offence or pays damages as compensation for the criminal offence.

Self-reporting is also relevant for mitigation of the sentence.

Also, persons are criminally liable if they knew that preparations to commit a criminal offence (punishable by imprisonment for five or more years) were underway but failed to report this at the time (when its commission could have still been prevented), and the offence is subsequently committed or attempted.

A member of an organised crime group may be granted cooperative witness status if its testimony would lead to the discovery or prevention of other crimes committed by that organised crime group. Cooperative witness status may not be granted to the purported leader of the crime group. There is one special agreement that is relevant in this regard: the agreement on testifying by a defendant. Such an agreement may be concluded with a defendant who has confessed in entirety to having committed a criminal offence, provided that the significance of his or her testimony in detecting, proving or preventing the criminal offence outweighs the consequences of the criminal offence that he or she has committed.

There is a need to align the provisions of Serbia's competition and criminal legislation. Under the Criminal Code for Cartel Offences, an exemption from punishment is possible (albeit with a guilty verdict) where the defendant satisfies the conditions for leniency under the competition legislation; but it remains to be seen how this will work in practice given the possibility of plea bargaining under criminal procedural legislation. The solution might be to include all of the leniency conditions in the agreement concluded with the public prosecutor (ie, the agreement on testifying by a defendant/cooperating witness).

6.5 Can the existence of a compliance programme constitute a defence to charges of white collar crime?

Yes, as outlined in question 4.5, a compliance programme will be considered by the court when determining the punishment within the limits for the particular offence and will serve as a mitigating factor. When imposing a fine, the court will take into account any measure (eg, a compliance programme) taken by the legal entity in order to prevent and detect the criminal offence.

A company may also be exonerated from punishment if:

• it detects and reports a criminal offence before learning that criminal proceedings have been instituted; or
• on a voluntary basis or without delay, it removes incurred detrimental consequences or returns the proceeds from crime unlawfully gained.

One of the measures for detecting a criminal offence is an internal investigation, based on a sound and functional compliance programme.

6.6 What other defences are available to parties charged with white collar crime?

One of the usual defences is that the defendant did not have the requisite intent (mens rea) to commit the crime. Numerous business crimes – and especially tax-related offences – can be defended in this way. The prosecution must prove that the defendant had the intent to commit the crime.

Another defence that can be used in relation to business crimes, albeit to a lesser extent, is that the defendant was ignorant of the law – that is, he or she did not know that his or her conduct was unlawful. If that person had no duty to know that his or her acts constituted a criminal offence, there is no culpability. However, this is used only in exceptional cases; the defendant must prove that he or she had no duty to know the law, which in the case of business crimes will be extremely difficult, as company directors and managers have an additional duty of loyalty and care.

The same applies to the defence that the defendant was ignorant of the facts – that is, he or she did not know that he or she had engaged in unlawful conduct. A compelling mistake of law exists where a perpetrator was not required or could not avoid a mistake about:

• a particular circumstance which is a statutory element of the criminal offence; or
• a particular circumstance which, had it existed, would have rendered such act permissible.

The defendant must prove the above, which in the case of business crimes will be extremely difficult, as company directors and managers have an additional duty of loyalty and care.

6.7 Can parties negotiate a pre-trial settlement through plea bargaining, settlement agreements or similar?

A defendant can voluntarily decline to contest criminal charges in exchange for a conviction on reduced charges or an agreed-upon sentence; but, generally speaking, this kind of agreement (ie, plea bargaining) is not yet as common as it is in adversarial systems.

Upon written agreement between the prosecution and the defendant, the court will accept the plea bargain if the following conditions are met:

• The defendant has knowingly and voluntarily confessed the criminal offence or criminal offences which are the subject matter of the charges;
• The defendant is aware of all consequences of the agreement, especially that he or she has waived his right to a trial and accepts a restriction of his or her right to appeal;
• All other existing evidence does not run contrary to the defendant's confession of having committed a criminal offence; and
• The criminal sanctions or measures in respect of which the prosecution and the defendant have reached an agreement were proposed in line with criminal and other laws.

6.8 What penalties can be imposed for white collar crime? How are these determined? Can non-exhaustive penalties be imposed for such violations (eg, exclusion from public procurement, exclusion from entitlement to public benefits or aid, disqualification from the practice of certain commercial activities, judicial winding up)?

Penalties can range from prison sentences to monetary fines. Once the court has determined that the defendant is guilty, the sentence is left to the court's sole discretion and there are no set rules in this regard. There are no sentencing guidelines. However, the court may take into account certain mitigating and aggravating circumstances, such as:

• the consequences of the criminal act;
• the standing of the defendant during trial;
• the defendant's remorse; and
• the defendant's criminal record, if any.

In addition to the sentence, the court can impose certain ancillary measures, such as:

• a ban on performing certain activity or professional duties (ie, disqualification from the practice of certain commercial activities); and/or
• the confiscation of assets.

For infractions regarding public procurement, a ban on participating in public procurement can also be imposed.

When imposing a sentence on a corporation, the court may also take into account certain mitigating and aggravating circumstances, such as:

• the level of culpability of the corporation;
• the number of persons in charge; and
• in particular, whether the corporation has adopted a compliance programme in order to prevent the occurrence of the criminal act.

A corporation can also be exempted from punishment if:

• it discovers and reports the criminal act prior to learning of the initiation of a criminal procedure against it; and
• voluntarily and without delay, it takes all necessary steps to remedy harmful effects or returns unlawfully obtained property.

Judicial winding-up can be ordered for the most severe corporate crimes and usually takes the form of deletion of the corporation from the Serbian Business Register.

6.9 What rights of appeal are available?

Both the public prosecutor and the defendant can seek redress from the appellate court for errors in both law and fact made by the trial court. If only the defendant appeals, the principle of reformatio in peius will apply, meaning that neither the appellate nor the trial court in a potential new trial may increase the sentence.

The grounds for appeal relate to both factual errors and errors in law. Usually, if any of the grounds are satisfied, the appellate court will quash the judgment of the trial court and remand the case to the same first-instance trial court for a retrial. If there were only errors in law by the trial court, it can reverse the judgment by entering its own. If the trial court's judgment in the retrial is also appealed, the appellate court must reverse the judgment of the first-instance trial court and enter its own judgment.

The defendant can also appeal the decision of the appellate court in cases where the appellate court reverses the acquittal of the trial court and renders a guilty verdict.

In addition, the defendant can submit an extraordinary legal remedy – a motion for a de novo trial – and seek to remedy the errors of the trial court. The grounds for de novo trial concern serious breaches of the procedural rights of the defendant – for example:

• the judgment was based on false testimony; or
• new evidence is available which, had it been disclosed in the earlier stages of the proceedings, would have led to an acquittal.

Finally, in limited cases, the defendant or public prosecutor can submit a motion for the protection of legality in order to remedy the errors of both the appellate and trial courts.

7 Alternatives to prosecution

7.1 What alternatives to criminal prosecution are available where the authorities find evidence of white collar crime?

The most prominent alternative is a deferred prosecution agreement (DPA), whereby a criminal case is resolved through pre-trial diversion to defer prosecution. As in adversarial systems, DPAs exist in a certain form in Serbia, with certain peculiarities.

In addition to criminal proceedings, an aggrieved person can bring a civil claim against the convicted person for damages caused as a result of a crime.

7.2 What procedures are involved in concluding an investigation in this way?

The public prosecutor may, after obtaining the opinion of the injured party, defer criminal prosecution for criminal offences that are punishable by a fine or imprisonment for up to five years if he or she finds that, in terms of the general interest, it would be inappropriate to conduct criminal proceedings, in view of:

• the nature of the criminal offence;
• the circumstances under which it was committed;
• the degree of culpability;
• the perpetrator's earlier life and personal traits; and
• the perpetrator's attitude towards the injured party, if the suspect accepts one or more obligations (see question 7.3) before the trial commences.

DPAs are not subject to the court's control, whereas plea bargains are. In such cases, the court considers whether any other evidence would conflict with the defendant's guilty plea. If there is contrary evidence, the court will dismiss the plea bargain.

7.3 What factors will determine whether such alternatives to prosecution are to be offered to those who have been involved in white collar crime?

The prosecution can defer criminal prosecution for certain criminal offences (punishable by imprisonment for up to five years) if the perpetrator accepts one or more of the following obligations:

• to remedy or indemnify the damage caused by the commission of the criminal offence or indemnify the damage caused;
• to pay a certain amount of money to the benefit of a humanitarian organisation, fund or public institution;
• to perform certain community service or humanitarian work; or
• to fulfil other obligations determined by a final court decision.

7.4 How common are these alternatives to prosecution? What, if anything, could lead to an increase in their use?

The use of DPAs is limited, as they cover only criminal offences that are punishable by a fine or imprisonment for up to five years. If this threshold were removed, it would lead to increased use of DPAs.

8 Private enforcement

8.1 Are private enforcement actions for white collar crims available in your jurisdiction? If so, where are they brought and what process do they follow?

Only to a certain extent. Full private prosecution was abandoned under the new adversarial Criminal Procedure Code. Individuals such as aggrieved parties can initiate private prosecutions; but if the public prosecutor decides that there is insufficient evidence to continue the proceedings, these parties can only appeal that decision and cannot take over the proceedings by replacing the public prosecutor. Subsequently, however, if the public prosecutor decides to drop the charges in the main hearing, the aggrieved party can take over the case.

8.2 What types of relief may be sought and what types of relief are most commonly awarded? How is the relief to be awarded determined?

In principle, an aggrieved party can seek civil compensation before a criminal court. Usually, the criminal court will refer the party to seek redress in the civil court once a guilty judgment has been issued.

Aggrieved parties can also seek redress directly in the civil court. Monetary relief is awarded based on the actual damage incurred by the aggrieved party (eg, the amount that was defrauded from a company which the company, as an aggrieved party, is now seeking to recover through a civil claim).

8.3 Can the decision in a private enforcement action be appealed? If so, how?

Yes, the decision in a private enforcement action can be appealed like any other decision in criminal proceedings.

9 Cyber issues

9.1 How do the white collar crime laws dovetail with cyber laws in your jurisdiction?

The unauthorised collection of personal data is a criminal offence under the Criminal Code and there are several further offences relating to cybersecurity breaches and unauthorised access. In addition, various high-tech crimes are recognised where computers, computer systems, computer networks, computer data and/or their products in material or electronic form are used as the object or means of committing criminal acts.

Specific forms of 'traditional' offences can also be committed in the cyber context, such as the offence of computer fraud, which can variously involve:

• entering incorrect data, failing to enter correct data or otherwise concealing or falsely representing data and thereby affecting the results of electronic processing; and
• transferring data with the intent of acquiring an unlawful material gain or causing material damage.

9.2 What specific considerations, concerns and best practices should companies be aware of with regard to white collar crime prevention in the cyber sphere?

Companies should develop a comprehensive compliance programme that also covers cyber-related issues and conduct regular training on cyber issues to ensure that their assets (eg, computers, data and networks) are not used as the object or means of committing a criminal act.

10 Trends and predictions

10.1 How would you describe the current white collar crime enforcement landscape and prevailing trends in your jurisdiction? Are any new developments anticipated in the next 12 months, including any proposed legislative reforms?

There is no unified way of approaching the enforcement of white collar crime and the general consensus is that there is no one arm's-length approach to dealing with white collar crime. For example, while the Law on Corruption from 2019 Prevention – like its predecessor – focuses mainly on corruption in the public sector, its application varies in practice, in line with initial concerns raised by stakeholders such as Transparency International and the wider public.

In addition, the initial idea behind the Financial Investigation Strategy was to:

• address the problem of financial crime by facilitating efficient and effective financial investigations;
• keep track of money flows and assets; and
• facilitate the proactive identification of criminal offences.

However, the strategy ended with mixed results and no new strategy has been proposed.

In addition, the Law on Confiscation and Proceeds of Crime should establish a more efficient system for the fight against corruption. However, some concerns have been raised by the Supreme Court of Cassation in relation to the application of the equality of arms principle to parties in the proceedings, as these usually involve the current owner to which the assets have been transferred and which may not benefit from the fair trial standards guaranteed by Article 6 of the European Convention on Human Rights through the equality of arms principle.

10.2 What high-profile white collar crime cases have arisen in your jurisdiction in recent times?

There is no unified way of adjudicating white collar crimes and the general consensus is that there is no one arm's-length approach to dealing with white collar crimes with respect to adjudication.

In recent years, there have been a few big cases relating to corruption in both the private and public sectors; but considerably more corruption cases arise in the public sector, as private companies seek to avoid media publicity over corruption issues. Regardless of the sector there are no final or binding convictions for high-profile cases.

11 Tips and traps

11.1 What are your top tips for the smooth implementation of a robust compliance programme and what potential sticking points would you highlight?

Adequate training of staff (including onboarding of new staff) and a clear and unconditional message from the company leadership of the importance of such training programmes are crucial. A confidential reporting channel for whistleblowers is also a key requirement: an external person (ombudsman or ombudsperson) should be appointed, with escalation lines going back to the company.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.