The relationship between the development of corporate law and the criminal liability imposed on corporations was discussed by Prof. Irit Haviv-Segal in her book: Corporate Law, 137 (chapter 3).B. Dealing with the Theory of Organs, 5767-2007, hereinafter: Haviv-Segal, Companies): "On this issue as well, the legal system has developed over the years, while adapting the allocation of responsibility to the prevailing insight in relation to the essence of the legal personality of the company."
In this section, I will first discuss the conceptual basis for imposing criminal liability on corporations and the use of organic theory for this purpose. I will then examine the manner and nature of the attribution of liability to a corporation within the framework of the theory of organs. At the same time, I will examine the conceptual basis for drafting immunity agreements with defendants who become state witnesses. Finally, I will examine whether the conceptual basis for the theory of organs on the one hand, and for the drafting of state witness agreements on the other, require that in addition to holding the defendant liable by virtue of the acts of the organs that were granted immunity, the immunity should also be granted to the defendant.
3.1 The Conceptual Basis for Imposing Criminal Liability on Corporations
3.1.1 Whether the conceptual basis for penal law exists in the case of a corporation
As I said earlier, the issue of corporate criminal liability was tied to the development of corporate law itself and their role in society. Haviv-Segal, Companies, at p. 137:
"As long as the legal system viewed the legal personality as a fiction, which has no real existence and is separate from the existence of the individuals operating behind it, the legal system has assumed that the legal norms that apply to 'flesh and blood' entities do not apply directly to artificial entities, i.e., societies.
Accordingly...There was no direct legal liability of the company for torts or for criminal offenses......This state of affairs has changed from the moment the legal system transitioned to a realistic insight...According to it, society enjoys a legal existence, which is essentially similar to the existence of the natural entity. Like the natural individual, the commercial company is considered an independent entity, worthy of enjoying legal rights and obligations that are identical to the rights and obligations of the natural individual. This also led to the development of the concept that there is no impediment to applying tort liability, and even criminal liability directly to companies."