When criminal proceedings end without an indictment

Not every investigation ends in an indictment. Discontinuance and diversion end it before that point; legally, they are very different.

Discontinuance

The public prosecutor's office must discontinue proceedings if the act is not subject to a court-imposed penalty, if there is no actual reason for further prosecution, or if a procedural bar exists. Discontinuance is not an acquittal, but it ends the proceedings without any sanction. Under narrow conditions, for instance if new evidence becomes known, the proceedings can be reopened as long as limitation has not set in.

Diversion

Where the offence carries no more than five years' imprisonment, proceedings can be resolved by way of diversion if culpability is not regarded as serious and the act did not result in a person's death: against payment of a sum, community service, a probationary period or victim-offender mediation. Diversion results in neither a conviction nor an entry in the criminal record.

What this means for companies

Legal entities, too, can be held liable under the Verbandsverantwortlichkeitsgesetz (Austrian Corporate Criminal Liability Act), and diversion is available there as well. For managing directors, the difference between discontinuance and diversion is not only legally relevant, but also matters for reporting obligations towards banks, insurers and principals; this question is often raised too late in advice.