Manager: In what cases can your civil or criminal liability be engaged?

A company director is accountable for their actions in two distinct areas. Civil liability obliges them to compensate for harm caused to the company, a shareholder, or a third party. Criminal liability aims to punish a violation of the law. The same act can give rise to both.

In criminal proceedings, a manager who is the direct perpetrator of an offense cannot be exonerated. In civil proceedings, the plaintiff must prove fault, harm, and a causal link between the two.

This page presents the cases of commitment as described on the official economie.gouv.fr website (page written on 30/07/2025). It does not address the articles of law, statutes of limitations, the amounts of fines, the duration of a ban on managing a business, or the rules specific to each type of company. These points should be verified on your case file.

Two responsibilities, two different approaches

Criminal liability: in what cases

The criminal liability of a manager can be invoked in two situations:

• he personally commits an offense; ;
• An employee commits an offence in the performance of his duties.

The official page cites the following as examples of offences: misuse of company assets, hiring of undocumented workers, tax fraud, forgery and use of forged documents, embezzlement, neglect of safety rules, customs and environmental offences, deception regarding the quality of the product sold.

Possible sanctions include a fine, a ban on holding a management position, or a prison sentence. The page does not specify the scale or duration of the penalties.

The delegation of powers

Two cases stand out.

You are the direct perpetrator of the offence. You cannot be exempted.

An employee committed the offence. You can be exonerated by proving that you delegated your powers to a competent person with the necessary resources and authority. The page also indicates that you can be exonerated by proving that you could not influence the employee's behavior.

The page cites a ruling by the Court of Cassation dated June 13, 2012 (no. 11-85280): the delegation of power granted to a person subject to a ban on managing does not exempt the manager from his criminal liability.

It is up to you to prove this delegation.

Civil liability: in what cases

What the applicant must prove

Three elements: a fault, harm, and a causal link between the two.

Who can act?

• A partner, acting individually (individual action).
• One or more partners, on behalf of the company : this is the social action known as «ut singuli».
• One third.

In the event of a conflict of interest between the company and the manager, the page indicates that the appointment of an ad hoc agent is mandatory for the company to be validly represented (Court of Cassation, November 9, 2022).

Types of faults

The page distinguishes several categories. Each is identified by examples.

What the cited case law specifies

Three points, as reported on the page:

• Since the Sapin II law of December 9, 2016, simple negligence is no longer considered a management error.
• Insufficient accounting, although detrimental, does not give rise to civil liability (Cass., October 2, 2024, No. 23-15.995).
• Failure to declare the cessation of payments constitutes a fault (Cass., February 5, 2020, No. 18-15.072; Cass., February 3, 2021, No. 19-20.004).

Addressing the social deficit

According to the page, the director may be ordered to cover the company's liabilities or face an extension of insolvency proceedings. This page does not specify the conditions or amounts involved.

Insurance coverage: a topic for discussion

Two facts, nothing more:

• Criminal liability cannot be covered by insurance; ;
• Civil liability can be covered by insurance taken out by the company for the benefit of the manager, which is mandatory in certain sectors.

Whether your company already has a contract of this type, what it covers and for whom, can be checked on the contract itself.

What changes depending on your situation

• Who committed the act? : yourself or an employee. This is what opens the door to the delegation of powers or not.
• The existence and quality of a delegation : to whom, with what means, with what authority.
• The type of offense alleged : detachable, management, tax, social, or violation of the statutes.
• The form of the company Commercial or civil, which changes the jurisdiction. The rules specific to each form are not addressed here.
• Who acts : a partner, the company, a third party, the public prosecutor.
• Your sector : liability insurance is mandatory in certain sectors.

The rule depends on your situation. No results are guaranteed.

Numerical example (fictitious profile)

Situation. A simplified joint-stock company (SAS), a hypothetical example, pays its president a salary of €90,000 for the fiscal year. Two scenarios are presented for the profit or loss before this salary payment: a loss of €20,000 (case A) or a profit of €150,000 (case B). For simplicity, social security contributions and income tax are ignored.

Issue. The official page cites awarding oneself excessive compensation despite losses as an example of mismanagement. For a civil action to succeed, there must be fault, harm, and a causal link. What do the figures show?

Strategy. Compare, in both cases, the result before and after compensation, and measure the weight of compensation in the loss.

Result.

In case A, the compensation represents 81.8% of the loss. It increases the loss by €90,000, whereas the loss would have been €20,000 without it. This is the scenario the page uses as an example of mismanagement. In case B, the company is profitable after compensation: the example cited on the page, which assumes losses, does not apply.

This calculation does not guarantee that misconduct would be found in case A. The excessive nature of the remuneration and the potential amount of any judgment are matters for the court to determine. The amounts are hypothetical. The profile is fictitious.