FCPAméricas Blog
Brazil’s Draft Bribery Bill … in Context
11.07.2012
Those of us tracking developments of Brazil’s draft bribery bill have grown accustomed to delays. FCPAméricas has already discussed the bill here, here, and here.
But this week the Thomson Reuters Foundation sponsored a half-day conference in Brasilia that shined an important new light on the process. The event was bolstered by the participation of the congressman in charge of the special committee overseeing the bill, Congressman Carlos Zarattini, as well as Minister Jorge Hage Sobrinho of the Office of Comptroller General, the body that would be in charge of enforcing the foreign bribery aspects of the law. The conference provided insight into the context in which the Brazilian Congress is considering passage of the legislation. Indeed, consideration is not happening in a vacuum.
Mr. Zarattini is still quite confident that the legislation will pass, and he predicts it will happen by year-end. This is consistent with his earlier statements to Trust Law. But Mr. Zarattini also referenced ongoing resistance to the bill that could thwart its passage, or lead to the passage of a watered down version that might complicate Brazil’s efforts to meet its international commitments. Another congressman has offered amendments that would weaken key provisions in areas like successor liability and the level of sanctions. Other representatives continue to express concern over the legislation’s provisions related to strict liability.
Adding an element of urgency, if Brazil wishes to pass and implement the law in time for the OECD Work Group’s 2014 review of the country’s compliance with OECD Anti-Bribery Convention commitments, the Brazilian Congress will need to act soon.
Many other changes in Brazil related to transparency and anti-corruption enforcement also provide helpful context to the bill. Consider the following.
The Mensalão. The Brazilian Supreme Court has just made historic progress in the mensalão, the country’s largest corruption trial to date. Twenty-five of the 38 defendants have been convicted.
Some believe that the case has the potential to send a powerful message to the most powerful businesspeople and politicians in the country. Those who, in the past, might not have worried much about the consequences of corruption might now be forced to make new calculations. Others take a more cynical view. If the public sees the case as politically motivated, few might ascribe real importance too it. In a recent interview, Mr. Zarattini himself expressed the view that the mensalão would make it more difficult for Congress to pass the new bribery legislation: “The Supreme Court convictions have led many people to doubt whether we should be creating new legal tools that allow the judiciary to act as it deems fit.”
Access to Information Law. The Brazilian Congress recently passed the Brazilian Information Access Law that went into effect in May 2012. The law creates a level of transparency with public funds that is unprecedented in the country. Now civil society can gain new access to government information, allowing people to understand better the workings of the public sector. There is even a “transparency portal” where people can review “real time” expenses of public employees, down to business card charges. This has allowed a new degree of scrutiny from the public and the press.
Anti-Money Laundering Law. As discussed here by FCPAméricas, the Brazilian Congress recently made changes to the country’s anti-money laundering law, increasing fines and broadening predicate offenses and the types of persons required to report suspicious transactions.
Despite these notable developments, what is most striking is that there is still little public awareness within Brazil about the bill. For example, when I gave an interview yesterday to Brazil’s equivalent of CSPAN about the bill, I saw that even the journalists who closely track Congress were still quite unaware of the bill’s huge significance. Mainstream media like O Globo and a Folha de São Paulo are not yet covering it. This is striking when you compare it to the enormous attention that the mensalão has generated. It is striking when you consider the considerable changes that the law would make to corporate liability, sanctions, successor liability, and other areas, and the impact it would have on the country’s reputation in the world.
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Post authored by Matteson Ellis, FCPAméricas Founder & Editor
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