section 732.1(3.2)

INTRODUCTION AND BRIEF DESCRIPTION

A court must consider if another regulatory body is better suited to supervise the development or implementation of policies before making an order under paragraph (3.1)(b).

SECTION WORDING

732.1(3.2) Before making an order under paragraph (3.1)(b), a court shall consider whether it would be more appropriate for another regulatory body to supervise the development or implementation of the policies, standards and procedures referred to in that paragraph.

EXPLANATION

Section 732.1(3.2) of the Criminal Code of Canada essentially puts a check on the powers of the court to appoint a regulatory body to oversee the development or implementation of policies, standards, and procedures in cases of corporate criminal liability. The section mandates the court to consider whether it is appropriate for another regulatory body to perform this function rather than the court appointing one. The section assumes significance in light of the increasing criminal liability of corporations in Canada. The need for supervision and accountability regarding corporate actions has become more pressing as corporations increasingly get involved in activities that impact society at large. At the same time, the appointment of regulatory bodies to oversee compliance with policies and standards is not always effective or efficient, as regulatory bodies are often beset by their limitations and limited resources. In such a situation, the court can appoint a regulatory body to supervise the development or implementation of policies, standards, and procedures in cases of corporate criminal liability. However, before making such an order, the court must consider whether another regulatory body (such as a relevant industry or disciplinary body) would be more appropriate to oversee the compliance with such policies and standards. Thus, the provision essentially seeks to ensure that the court does not act unilaterally and in a vacuum in overseeing corporate compliance with the law. It mandates that the court consider the existing regulatory framework and whether another regulatory body could be better suited to perform the function of overseeing the development and implementation of compliance policies and standards. This ensures that the court's order is rational and just, as it is informed by the broader regulatory landscape within which the offending corporation operates.

COMMENTARY

Section 732.1(3.2) of the Criminal Code of Canada holds significant importance for regulatory bodies and the Canadian legal system. This section provides guidelines on the consideration that a court must undertake before making an order under paragraph (3.1)(b). The paragraph (3.1)(b) of Section 732.1 in the Criminal Code of Canada provides the power to the court to impose conditions on a person who is released from custody, including probation, to maintain a peace bond, and to comply with specific conditions for a limited or indefinite period. The section aims to protect the public, restore the harm caused by the offence, and assist the offender's rehabilitation. However, before making any order under paragraph (3.1)(b), the court must consider whether it would be appropriate for another regulatory body to supervise the development or implementation of the policies, standards, and procedures relevant to that paragraph. This consideration is significant because it ensures that the regulatory body is in the best position to manage the issue, ensure its compliance, and monitor the growth of relevant standards. The consideration enshrined in section 732.1(3.2) requires the court to analyze various factors critically. Primarily, the court must review whether another regulatory body has the appropriate expertise, powers, and resources to execute the desired implementation, development, and supervision of the relevant policies and regulations. The court must evaluate the efficacy of the regulatory body's supervision by determining whether its regulatory functions align with the objective of making the order under paragraph (3.1)(b). Another crucial factor that the court must consider is the regulatory body's accountability framework. Before committing to the regulatory body, the court must assess the regulatory body's ability to hold wrongdoers accountable and ensure compliance with legal standards. Moreover, the court must review the regulatory body's past supervision records to assess if they can execute the desired functions effectively. The consideration mandated in Section 732.1(3.2) promotes collaboration between the legal system and other regulatory bodies, including government authorities, academic institutions, and other community organizations. Collaboration is necessary because certain regulatory bodies may possess more specialized levels of expertise and understanding than the legal system regarding specific subject matters. The consideration expedites the identification of industry-specific standards, and policies necessary to improve compliance and reduce recidivism within the regulatory framework. Additionally, the consideration mandated in Section 732.1(3.2) leads to a more holistic and comprehensive response to the harm caused by the offense. The regulatory framework enables the creation of policies that focus on rehabilitation, posing as a more sustainable solution for affected offenders. In contrast, criminal sanctions might deter future crimes, but they often fail to address fundamental issues and reduce recidivism effectively. Furthermore, the consideration mandated under Section 732.1(3.2) prevents the legal system from interfering with regulatory frameworks that are already in place. Unnecessary meddling in regulatory frameworks might create redundancy, increase compliance costs, and lead to conflicting standards of regulations. In conclusion, Section 732.1(3.2) of the Criminal Code of Canada is critical in promoting collaboration between the legal system and other regulatory bodies, facilitating a more nuanced and comprehensive approach to crime prevention, and fostering accountability and compliance. It is essential to support ongoing efforts aimed at improving regulatory frameworks to achieve the desired objectives within the Canadian legal system.

STRATEGY

Section 732.1(3.2) of the Criminal Code of Canada has significant implications for businesses and organizations that are charged with regulatory offences. This section of the Code gives courts the discretion to consider whether another regulatory body may be better suited to supervise or regulate the development and implementation of policies, standards, and procedures related to regulatory compliance. As such, companies must approach their legal defense with a strategic mindset to avoid unnecessary penalties. One of the most important strategic considerations for businesses who are facing regulatory penalties is to undertake a comprehensive risk assessment. This risk assessment should evaluate both the potential outcomes of going to trial and the cost-benefit analysis of seeking out alternative regulatory bodies to supervise their compliance. A company should consider the stakes of their case, the regulatory frameworks that may apply, and their timelines for compliance. By adopting this approach, companies can determine the most effective strategies to manage the risks of regulatory enforcement. Another important strategy that can be employed is to proactively comply with regulations, policies, and guidelines, including developing and implementing compliance policies and procedures within the company. By demonstrating to the court that they are committed to their compliance obligations, companies can potentially avoid penalties and regulatory enforcement actions. Further strategies to mitigate potential regulatory enforcement risk may include reaching out to or bringing on board experts in the specific regulatory practice area in which the company is operating. Such expertise can help in the development, implementation, and monitoring of compliance programs and policies that can better the regulatory chances of the company. Companies charged with regulatory offences should also remain updated on any changes or amendments to the current legal and regulatory landscape. They should be able to provide the court with information on the most recent changes and justify why supervisory jurisdiction would be better exercised by the specific regulatory body they are suggesting. In conclusion, strategic considerations are crucial when dealing with Section 732.1(3.2) of the Criminal Code of Canada, and it is essential for businesses to approach their legal defenses with a deliberate, proactive mindset. By performing a comprehensive risk assessment, adopting a strong compliance program, seeking out regulatory compliance expertise, and remaining updated on any regulatory changes, businesses and organizations can better manage the risks associated with regulatory enforcement. By employing these strategies, businesses can attempt to reduce or minimize any penalties that may come their way, and ultimately protect their bottom line.