OECD Urges Brazil to Implement Key Reforms to Strengthen Fight Against Foreign Bribery

Brazil is being called upon to urgently undertake significant reforms to build on its recent progress in the fight against foreign bribery, according to the Organization for Economic Co-operation and Development (OECD). The OECD's 45-country Working Group has just completed its Phase 4 evaluation of Brazil's implementation of the Convention on Combating Bribery of Foreign Public Officials in International Business Transactions and related instruments.

While the Working Group recognizes Brazil's efforts in sanctioning large-scale foreign bribery schemes through non-trial resolutions with three legal entities, including its involvement in a high-profile multi-jurisdictional resolution, it has highlighted several areas that require immediate attention. Brazil has a limited number of ongoing enforcement proceedings in this regard, and no individual has yet received a final conviction for the bribery of a foreign public official.

The Phase 4 evaluation report expresses serious concerns about Brazil's statute of limitations for natural persons, which is deemed inadequate to effectively sanction foreign bribery. Furthermore, Brazil's whistleblower framework is incomplete, and it requires enhancement to provide adequate protection for those reporting foreign bribery allegations, particularly in the private sector. The report also raises concerns about perceived threats to the independence of prosecutors in foreign bribery cases.

The Working Group has recommended several key reforms for Brazil to strengthen its fight against foreign bribery, including:

1. Increase Sanctions for Natural Persons: Brazil should enhance the sanctions for foreign bribery when committed by natural persons.
2. Address Limitations Period: By legislative or other effective institutional measures, Brazil should address the limitations period for foreign bribery based on the defendant's actual sentence to allow sufficient time for investigation and prosecution of natural persons.
3. Protect Foreign Bribery Cases: Measures should be put in place to safeguard foreign bribery cases from potential political bias by law enforcement agents and the arbitrary use of disciplinary or other accountability measures.
4. Revise Whistleblower Protection Framework: Brazil should swiftly revise its whistleblower protection framework to explicitly cover private-sector individuals who report foreign bribery allegations.

The Phase 4 evaluation report also acknowledges positive developments in Brazil's efforts to combat foreign bribery. The country has refined its legal and institutional framework for imposing corporate liability, effectively used leniency agreements, and demonstrated cooperation with counterparts in Working Group and non-Working Group countries. This collective effort has resulted in some of the largest global fines imposed in such cases. Additionally, various Brazilian agencies have taken steps to issue guidance, promote corporate compliance, and enhance transparency to foster a cleaner business environment in Brazil.

The Working Group's recommendations aim to further strengthen Brazil's commitment to fighting foreign bribery and ensuring that the legal framework remains robust and effective in addressing such issues. This report reflects the ongoing efforts of Brazil, in cooperation with international organizations, to combat transnational corruption and enhance transparency in business practices.