Compliance Guides

Brazil Compliance Guide

Brazil’s Clean Company Act 2014 (Law No. 12,846) is the country's first anti-corruption law to hold companies responsible for their employee’s corrupt actions. The Act imposes strict liability on companies operating in Brazil for domestic and foreign bribery and provides no exception for facilitation payments. Unlike the UK Bribery Act, there is no statutory defence for having implemented ‘adequate procedures’ to prevent persons for committing corrupt acts on behalf of the company. These provisions make the Clean Company Act among the toughest anti-corruption laws in the world. 

Brazilian Compliance Guide

The Decree 8.420/2015 (in Portuguese) stipulates criteria by which a company's compliance system will be evaluated when sanctions are imposed. Having a compliance program in place in accordance with these criteria can significantly lessen administrative penalties. Factors such as the size of the company will be part of the compliance program's evaluation. Here are some guidelines to consider:

Top-Level Commitment

Top-Level Commitment

Senior management should convey a clear policy against corruption to employees and show commitment to the policy.

Risk Assessment

Risk Assessment

Potential risks should be periodically researched, analysed and addressed.

Proportional Procedures

Compliance Policies

Compliance policies and procedures must be applicable to all employees and third parties. The compliance function must be independent and have authority. If relevant, there must be specific procedures related to public procurement and interactions with government officials.

Due Diligence

Due Diligence

Third parties should be regularly assessed, especially before awarding and renewing contracts. Due diligence must be used in corporate and M&A transactions.

Training

Internal 
Monitoring, Testing and Review

Appropriate steps should be taken to ensure policies are continually communicated, reassessed, understood, and updated over time. Procedures must be in place to detect and stop irregularities and to remediate damages. 

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Transparency

Establish internal controls to ensure the reliability of financial statements. Ensure that books and records must be accurate and complete.

 Communicate

Reporting and Disciplinary Measures

Establish channels of communication where employees are free to report offences and good faith whistleblowers are protected. Share information on irregularities among employees and third parties. Establish disciplinary measures to penalise non-compliance. Update policies and procedures following investigations.

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Training

A company’s code of conduct should be clear, detailed and communicated to all employees and third parties. Periodical training must take place. 

 

Updated: November 2015

Clean Company Act Summary
Clean Company Act Full Text

Topics: Brazil