TerraLex Guide to Anticorruption Legislation

Non-member until March 2025.

Law # 12.846, dated as of August 1, 2013.

Acts committed against national or foreign public administration. The wrongful acts are set forth in Law 12.846/2013, article 5, as follows:

I – to promise, offer or give, directly or indirectly, an undue advantage to a public official or to a third party related to him/her;

II – to demonstrably finance, defray, sponsor or in any way subsidize the performance of the wrongful acts established in this Law;

III – to demonstrably make use of a third party, either an individual or a legal entity, in order to conceal or dissimulate the entities´ actual interests or the identity of those who benefited from the performed acts;

IV – with respect to public bidding and government procurement: a) to thwart or defraud, through an adjustment, arrangement or any other means, the competitive nature of public bidding processes; b) to prevent, disturb or defraud the execution of any act related to a public bidding process; c) to remove or try to remove a bidder by means of fraud or by the offering of any type of advantage; d) to defraud public bidding processes or bidding-related contracts; e) to create, in a fraudulent or irregular manner, a legal entity with the purpose of participating in a public bidding process or of entering into a contract with the public administration; f) to gain undue advantage or benefit, in a fraudulent manner, from amendments or extensions of contracts executed with the public administration without authorization in the Law, in the notice of the public bidding or in the respective contractual instruments; or g) to manipulate or defraud the economic and financial balance of the contracts executed with the public administration;

V – to hinder investigations or inspections carried out by public agencies, entities or officials, or to interfere with their work, including the activities performed by regulatory agencies and by inspection bodies of the national financial system.

Yes, any wrongful act provided for in article 5 against foreign public administration will be reached.

No, only acts committed against national or foreign public administration.

No.

Yes, the anti-corruption law provides for the strict civil and administrative liability.

Yes.

Yes, but due to criminal legislation (penal code), with criminal sanctions.

The anti-corruption law does not apply to individuals as set forth in in article 1 of Law no. 12.846, of 2013, as follows:

“Art. 1 This Law provides for the objective administrative and civil liability of legal entities for acts against the public administration, whether national or foreign.”

But, article 3, of Law no. 12.846, of 2013 provides that the responsibility of managers and director are not excluded, even if the legal entity is found liable, as follows:

“Art. 3 The liability of a legal entity does not exclude the individual liability of its directors or managers or of any natural person who is the author, co-author or participant in the unlawful act.

§ Paragraph 1 The legal entity shall be held liable regardless of the individual liability of the natural persons referred to in the caput.

§ Paragraph 2 - Managers or directors shall only be held liable for unlawful acts to the extent of their culpability.”

For directors, sanctions are outlined in criminal legislation (Penal Code) for offenses such as: (i) Fraud and abuse in the formation or management of a joint-stock company; (ii) Crimes against public faith; and (iii) Prevarication.

For corporations, administrative fines may reach up to 20% of the company's gross revenue or a maximum of R$ 60 million, along with the mandatory publication of the condemnatory decision.

In addition to administrative fines, corporations are subject to judicial sanctions, including: (i) Confiscation of property, rights, or assets representing the direct or indirect benefits gained from the violation, except when affecting the rights of victims or bona fide third parties; (ii) Partial suspension or prohibition of activities; (iii) Compulsory dissolution of the organization; and (iv) Prohibition from receiving incentives, subsidies, grants, donations, or loans from public agencies, state-owned enterprises, or government-controlled financial institutions for a period of one to five years.