THE NEW GUIDELINES OF THE BRAZILIAN CLEAN COMPANY ACT
Finally, after more than a year of the enactment of the Brazilian Clean Company Act (BCCA), the guidelines explaining various provisions of the statute have been issued by the Brazilian government via a decree. Decree 8,420/15 came into force on 18 March after a number of major demonstrations by the general public in the country’s main cities. The country has expressed its indignation toward all of the administration’s corruptions scandals, particularly the current one dubbed ‘Petrolão’ which involves the state controlled oil and gas company Petrobras, infamous all over the globe as one of the largest corruption scandals of this century.
These recent nationwide demonstrations were very similar to the ones recorded in 2013. Two years ago Brazilians went out to the streets to complain about corruption in the current administration, and the economic crisis allegedly resulting from their incompetence. As before, the Brazilian government decided to take some action to respond to the nation’s overwhelming pressure. Thus, Decree 8,420/15 was enacted only three days after the March demonstrations.
Compliance experts in Brazil were anxiously awaiting the publication of this decree, since, as expected, it encourages the adoption of compliance programs, and sets forth the requirements of an effective scheme. Before these guidelines the BCCA was rather vague about the programs and Brazilians, who were not used to the idea of compliance measures at all, now understand that they are practically mandatory.
The first requirement established by the guidelines is the commitment of the company’s senior management (the tone at the top) followed by the requirement to implement codes of ethics and conduct for all employees, including equity holders, and third parties.
Jul-Sep 2015 Issue
KLA-Koury Lopes Advogados