Federal Council Suggests Clarifying Section 130 of the Administrative Offenses Act

The Federal Government has submitted a draft bill to implement Directive (EU) 2024/1203 on the protection of the environment through criminal law. Against this backdrop, the Federal Council is using its opportunity to issue an opinion to propose a significantly more far-reaching initiative: It suggests that requirements for compliance management systems under regulatory offense law be specified in law.

The Federal Council´s statement is being made in the context of the draft bill to implement Directive (EU) 2024/1203. The aim is to further harmonize environmental criminal law within the EU and to prosecute environmental crimes more effectively in light of rising case numbers and their often cross-border nature.

Among other things, the draft provides for

• making the intentional discharge of materials, substances, energy, or ionizing radiation into the air, soil, or water a criminal offense if this results in significant damage to the environment or to persons,
• to classify the implementation of projects requiring a permit and an environmental impact assessment without the necessary authorization as a criminal offense,
• to newly define other environmentally harmful behaviors or to expand existing criminal offenses accordingly, and
• to significantly increase the range of penalties, both for individuals and for companies.

Most of these changes are to be incorporated directly into the Criminal Code. At the same time, however, the draft bill also addresses general provisions. For example, a significant expansion of the range of sanctions under Section 30 of the German Act on Regulatory Offences (OWiG) is envisaged. The maximum limit for corporate fines is to be raised from 10 million euro to 40 million euro for intentional offenses and from 5 million euro to 20 million euro for negligent offenses.

The new regulation covers not only environmental offenses but all offenses that can trigger a corporate fine under Section 30(1) of the OWiG.

Background: Current Legal Situation Regarding Compliance Management Systems

To date, the legal requirements for compliance management systems have been defined only in very general terms. The central legal basis is Section 130(1) of the OWiG. This provision obligates executives to take the “necessary supervisory measures” to prevent legal violations within the company. However, the law leaves largely open what exactly constitutes these supervisory measures and when a compliance system is considered “sufficient.”

In practice, this means:

• To date, standards for an effective compliance management system have been developed primarily through case law and practical experience.
• Compliance structures have generally been taken into account when determining the amount of fines based on criteria established by the courts.

The result: Companies face a high degree of legal uncertainty as to whether their compliance system will be deemed “adequate” in the event of a serious incident and to what extent it will be taken into account to reduce the fine.

What’s new? The Federal Council’s proposals

This is where the Federal Council’s initiative of June 12, 2026, comes in. Section 130(1) of the OWiG is to explicitly list appropriate compliance measures in the future. According to the proposal, these include, in particular:

• the careful selection, training, and supervision of employees and supervisory personnel,
• the regular identification and assessment of risks arising from the business or company that could lead to the commission of criminal offenses and administrative offenses,
• the adoption and further development of guidelines and instructions, as well as the training of employees for the purpose of preventing corporate crimes and administrative offenses,
• a procedure that enables employees, while maintaining confidentiality, to report indications of possible corporate crimes or administrative offenses to an appropriate authority, and
• the investigation of suspicious circumstances indicating corporate crimes or administrative offenses, as well as the punishment of such misconduct.

In addition, the Federal Council proposes amending Section 30(2a) of the OWiG so that compliance measures are given significantly greater prominence in the law governing fines imposed on associations. It proposes that “appropriate precautions taken to prevent or detect criminal offenses and administrative offenses” must in future be taken into account as mandatory factors reducing the fine.

The Federal Council specifically cites as appropriate precautions the elements of a compliance management system described in Section 130(1), sentence 3, nos. 1 through 5 of the draft OWiG. Serious and effective compliance efforts, both before and after an offense, would henceforth be required to result in a reduction of fines, while merely formal or superficially implemented structures (“window dressing”) would not justify any leniency. This would mark the first time the legislature has more clearly defined the elements that constitute an adequate compliance management system. At the same time, it would be explicitly recognized that functioning compliance structures not only have a preventive effect but can also be taken into account to reduce fines in the event of sanctions.

What are the implications of the Federal Council’s opinion, and what is the current status of the legislative process?

The Bundesrat’s opinion has no immediate impact on the legislative process at this stage. The federal government must respond to the opinion in the coming weeks, and further developments are likely to depend on the federal government’s response.

The Federal Government’s draft bill, which does not yet include the amendments to the OWiG, passed its first reading in the Bundestag on June 11, 2026, and was referred to the committees for further deliberation. It is not yet possible to predict when the new regulations will take effect or what their exact content will be.

What do the changes mean for companies—and what should be done now?

Companies should closely monitor (or have someone monitor) the ongoing legislative process and conduct a review of their existing compliance structures, particularly with regard to risk analysis, policies, training, whistleblower systems, and processes for investigating and sanctioning violations. On this basis, existing gaps should be identified and translated into a concrete action plan for further developing the compliance management system.

Regardless of the outcome of the legislative process, companies should prioritize an effective compliance management system: It significantly reduces liability and reputational risks and is a central element of modern, responsible corporate governance.

Back to list