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The Crime and Policing Bill, which has recently progressed through the Committee Stage in the House of Lords, introduces a further, transformative expansion of corporate criminal liability in the UK. The Bill proposes that companies can be held criminally liable where a “senior manager” commits an offence while acting in their actual or apparent authority, for all crimes. This marks a fundamental departure from the current senior manager framework under the Economic Crime Corporate Transparency Act 2023 (ECCTA) where, currently, corporate liability is restricted to economic crimes.
The evolution of corporate criminal liability
By way of a recap, prior to December 2023 a company could only be held criminally liable for the actions of individuals representing its “directing mind and will,” typically limited to board members and the most senior executives. This common law doctrine, known as the identification principle, created a high threshold that prosecutors often struggled to meet. Whilst certain statutory exceptions existed, for example under the Bribery Act 2010 and Corporate Manslaughter and Corporate Homicide Act 2007, these were narrow in scope.
With ECCTA coming into force in December 2023, this represented a significant change. Section 196 of the Act established a new basis for corporate liability where a company could be held liable for the actions of a “senior manager,” namely those who play a significant role in the “making of decisions about how the whole or a substantial part of the activities” of a company or partnership are to be managed or organised, or if they actually manage or organise “the whole or substantial part of those activities.”
While section 196 captures a broader tier of management than before, it is currently limited to economic crimes, and specifically those listed in Schedule 12 of the Act (including, for example, under the Fraud Act 2006, Theft Act 1968, and Proceeds of Crime Act 2002, as well as the common law offence of Conspiracy to Defraud). Separate to this ECCTA also introduced the failure to prevent fraud offence under section 199, in force as at September 2025.
The proposed extension
The Crime and Policing Bill, first published in February 2025, is due to be considered at Report Stage on 25 February 2026. Following this the Bill will proceed to a third reading in the House of Lords before, subject to parliamentary approval, receiving Royal Assent. While this is likely to be later this year, it is not yet clear when the provisions will come into force.
The critical provision for the purposes of corporate criminal liability is Clause 196 (originally Clause 130). Should the Bill be passed without further amendment to this clause, we will in due course see an expansion to corporate criminal liability such that the senior manager test will apply to all crimes, not just economic.
Building on the wider campaign for reform of corporate liability over the last 10 years, an amendment of this kind will make it significantly simpler for prosecutors to hold corporates to account for crimes committed by their senior personnel. Environmental and other non-financial offences will be caught, potentially even where the company has not itself benefited. It is therefore critical for companies to carefully plan, and to put in place measures to mitigate the additional risks that the expansion of corporate criminal liability will bring.
About the author
Caroline is an investigations specialist. She advises organisations and individuals caught up in serious and complex criminal and regulatory investigations. She has extensive experience in this area and conducts internal investigations on behalf of her corporate clients when allegations of misconduct arise.
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