Internal Corporate Investigations in Lebanon: Navigating the Legal Framework
Introduction
Allegations of fraud, corruption, conflicts of interest or breaches of internal policies will
often require a company to investigate before deciding how to act. In Lebanon, there is
no single law that regulates internal investigations or specifies their course. Thus,
companies have to work within several legal regimes at once, mainly those relating to
employment, personal data, criminal liability, anti-corruption and professional secrecy.
The company should therefore balance its interest in uncovering the misconduct and
protecting its assets against the rights of the employees and other persons involved.
1. Legal Framework Governing Internal Investigations
While Lebanese law does not set out a procedure for internal investigations, several laws
may apply depending on the type of allegations and the steps taken during the
investigation.
a. Lebanese Labour Law
The Labour Code of 23 September 1946 governs the employment relationship and, with
it, any disciplinary measures or termination that follow the investigation. Article 74
specifies the limited cases in which an employee may be dismissed without notice or
indemnity, while Article 50 governs termination generally and exposes the employer to
damages for abusive dismissal. Thus, before taking disciplinary action, the company
should check whether the established facts meet the statutory grounds. The investigation
should distinguish between what was alleged, what is supported by evidence and what
conduct can actually justify termination. A dismissal based on suspicion alone will be
difficult to defend before the labour arbitration councils.
b. Personal Data Protection
Law No. 81/2018 on Electronic Transactions and Personal Data regulates the collection,
processing, storage and disclosure of personal information. Article 87 requires personal
data to be collected fairly and for legitimate, specific and explicit purposes, and Article
93 imposes obligations to keep such data secure. These provisions apply whenever the
investigation involves reviewing employee emails, electronic communications or
personnel records. The company should therefore make sure that the investigative steps
do not go further than the allegations justify, and that only the persons running the
investigation have access to the information collected.
c. Anti-Corruption and Whistleblower Protection
Lebanon has adopted Law No. 83/2018 on Whistleblower Protection, as amended by Law
No. 182/2020, and Law No. 175/2020 on combating corruption in the public sector andestablishing the National Anti-Corruption Commission. These laws become relevant
where the investigation concerns suspected corruption involving public officials or other
conduct within their scope. It is worth noting however that the company's internal
reporting channel is not the reporting procedure provided for by these laws, and the
statutory protections attach to the latter. Thus, it should not be assumed that an employee
who reported internally is protected under the law.
d. Financial Institutions Regulated by the Banque du Liban
Where the company is a financial institution licensed by the Banque du Liban (BDL), the
investigation should also take into account BDL Basic Decision No. 13819 of 21 May
2026 on the conditions for establishing and operating financial institutions. Article 9
requires these institutions to maintain control functions, such as risk management,
compliance, internal audit and customer protection, which are separate from the
executive functions, and Article 18 makes the board of directors responsible for
approving the internal control framework and closely supervising management. Article
20 prohibits outsourcing these control functions to a third party. Thus, while external
counsel may be appointed to conduct or assist the investigation, this does not relieve the
institution's own compliance and internal audit functions of their responsibilities. The
institution must also inform the BDL and the Banking Control Commission in detail, as
soon as they are filed, of any lawsuits brought against it, its shareholders or its managers
(Article 18), and provide either of them with any documents they request (Article 15). It
is worth noting that the findings of the investigation may therefore reach the regulator,
and may affect the position of the directors and senior managers concerned, since the
BDL Central Council may object to the continuation of their mandate where they no
longer meet the fit and proper criteria (Article 8). Moreover, providing incomplete or
inaccurate information may expose the institution to fines and to referral to the Higher
Banking Commission (Articles 29 and 30).
2. Conducting an Internal Corporate Investigation
The first step should be a clear assessment of the allegations and of the legal exposure the
company may face. The scope should then be defined at the outset by identifying the
relevant individuals, transactions, documents and suspected misconduct. Depending on
the case, the investigation may include reviewing financial records, examining contracts,
interviewing employees and preserving electronic evidence. Where senior management is
involved in the allegations, the company should consider appointing independent external
counsel, which avoids conflicts of interest and makes the outcome more credible.
Throughout the investigation, accurate records should be kept of the evidence collected,
the interviews conducted and the conclusions reached.
3. Confidentiality and the Role of External and In-House CounselConfidentiality is a central concern, particularly where the allegations concern fraud,
corruption or misconduct of senior management. In Lebanon, the protection given to the
communications and findings of the investigation may differ depending on whether it is
conducted by external counsel or by an in-house team.
a. Investigations Conducted by External Legal Counsel
Article 92 of Law No. 8/1970 Regulating the Legal Profession sets out the lawyer's duty
of professional secrecy, which prohibits disclosing confidential information acquired in
the exercise of the profession. Thus, where external counsel is engaged to conduct the
investigation for the purpose of giving legal advice, the communications and information
received in that capacity may benefit from this protection. However, the involvement of
external counsel does not make every document, piece of evidence or finding immune
from disclosure. The protection should be assessed according to the nature of the
information, the circumstances in which it was obtained and the applicable provisions.
b. Investigations Conducted by In-House Legal Teams
A distinction should be made between in-house personnel who are registered lawyers and
employees who perform legal or compliance functions without that status. Whether the
professional secrecy rules apply depends on the person's professional status and the
capacity in which the information was obtained. Employees who are not subject to these
rules remain bound by their contractual confidentiality obligations and by Article 579 of
the Penal Code, which penalises the disclosure of secrets acquired through a person's
position, employment or profession. It is worth noting however that these obligations are
not equivalent to the protection given to communications with external counsel. Internal
investigations may also raise concerns of independence, particularly where the
allegations involve persons who have authority over the legal or compliance department.
The company should therefore assess whether its internal team can conduct the
investigation effectively or whether external counsel should be appointed.
4. Evidence Preservation and Employee Rights
Relevant documents, electronic communications and financial records should be secured
at an early stage, before they can be deleted or altered. At the same time, the company
must respect the legal restrictions on personal data, employee privacy and the
confidentiality of communications. Collection should be limited to what is reasonably
necessary for the investigation, with safeguards against unauthorised access, alteration or
disclosure. Where possible criminal conduct is uncovered, the company should consider
whether referral to the competent judicial authorities is appropriate or required by law. An
internal investigation does not replace an investigation by the judicial authorities, nor
does it give the company the investigative powers reserved to them.
5. Challenges Facing Companies in LebanonSince there is no unified procedure, each investigative step has to be assessed under
several legal frameworks. The growing use of electronic communications and digital
records also raises questions regarding employee privacy, access to company systems and
the lawful handling of personal information. The choice between external counsel and an
internal team requires careful consideration where confidentiality, independence and
potential litigation are concerned, and companies operating in several jurisdictions may
face further complications where evidence, employees or records are located outside
Lebanon. Thus, it is important to have clear internal reporting procedures, document
retention policies and investigation protocols in place before any allegations arise.
Conclusion
Internal investigations play an important role in uncovering misconduct, managing legal
exposure and strengthening corporate governance. In Lebanon, their effectiveness
depends not only on the evidence obtained but also on compliance with the rules on
employment, personal data and professional secrecy. The decision to investigate
internally or to appoint external counsel should therefore be guided by the seriousness of
the allegations, the possible legal consequences and the need to preserve confidentiality
and independence. By following a structured procedure and obtaining proper legal
advice, companies can deal with wrongdoing while limiting the risk of further disputes
and reputational damage.