A compliance program protects a company in three concrete ways, and none of them is immunity. First, it reduces the likelihood of the unlawful act, by creating controls over purchasing, public bidding, donations, sponsorships and the hiring of third parties. Second, it enters the calculation of the sanction: Article 7, VIII, of Law No. 12.846 of August 1, 2013 requires the existence of internal integrity mechanisms to be considered when applying sanctions, and Decree No. 11.129 of July 11, 2022 allows up to 5% of the fine calculation base to be deducted where the program exists and is effectively applied. Third, it gives the company the ability to detect, investigate and, where appropriate, negotiate a leniency agreement before the authorities reach the problem on their own.
Strict liability: what it means in practice
Article 1 of the Anti-Corruption Law deals with the strict administrative and civil liability of legal entities for acts against the public administration, whether Brazilian or foreign. Article 2 completes the picture: legal entities are held strictly liable for unlawful acts committed in their interest or for their benefit, whether exclusive or not. There is no need to prove that the company intended, knew or was negligent. The act, the link and the interest are enough.
This does not rule out the liability of individuals: Article 3 preserves the individual liability of officers, managers and participants in the wrongdoing, who answer to the extent of their culpability. And liability follows the company through corporate reorganizations. Under Article 4, it survives amendments to the articles of association, conversions, mergers, acquisitions and spin-offs. In mergers and acquisitions, the successor's liability is limited to payment of the fine and full compensation for the damage, up to the value of the transferred assets, except in cases of simulation or clear intent to defraud. Parent, subsidiary, affiliated and consortium companies are jointly liable, also limited to the fine and compensation (Article 4, paragraph 2).
What counts as an unlawful act
Article 5 defines the unlawful acts, among them promising, offering or giving an undue advantage to a public official or a related third party, financing or sponsoring the practice of the offenses, using an intermediary to conceal interests or beneficiaries, a set of conducts related to public bidding and administrative contracts, and obstructing investigation or oversight by public bodies. The connection with the public sector is the key exposure: government suppliers, regulated companies and businesses that depend on licenses and authorizations are permanently exposed.
Fines and other sanctions
In the administrative sphere, Article 6 provides for two sanctions: a fine of 0.1% to 20% of the gross revenue of the last financial year before the administrative proceeding was opened, excluding taxes, which may never be lower than the advantage obtained where it can be estimated, and extraordinary publication of the decision. Where the revenue criterion cannot be used, the fine ranges from BRL 6,000.00 to BRL 60,000,000.00 (Article 6, paragraph 4). In any case, the sanction does not remove the duty to fully compensate the damage (paragraph 3).
In the judicial sphere, Article 19 allows the federal government, the states, the Federal District, the municipalities and the Public Prosecutor's Office to seek forfeiture of assets and amounts obtained through the offense, suspension or partial interdiction of activities, compulsory dissolution of the legal entity and a ban on receiving incentives, subsidies, grants, donations or loans from public bodies and public financial institutions for 1 to 5 years. Offenses are time barred after 5 years, counted from awareness of the offense or, in permanent or continuing offenses, from the day it ceased (Article 25).
There is also an effect on the public market: Article 155, XII, of Law No. 14.133/2021 treats the practice of an unlawful act under Article 5 of the Anti-Corruption Law as an administrative infraction, which may lead to a declaration of unfitness, applicable before all federative entities for 3 to 6 years.
How the fine is calculated
Decree No. 11.129/2022, which regulates Law No. 12.846/2013 and repealed Decree No. 8.420/2015, details the calculation. Article 22 adds aggravating percentages to the calculation base: up to 4% where there is a concurrence of unlawful acts, up to 3% for tolerance or knowledge by the board or management, up to 4% for interruption of a public service or breach of regulatory requirements, 1% for the offender's economic situation, 3% for recidivism within less than five years, and 1% to 5% depending on the value of contracts held or sought with the injured body.
Article 23 subtracts: up to 0.5% where the offense was not consummated, up to 1% for spontaneous return of the advantage and compensation for the damage, up to 1.5% for the degree of cooperation, up to 2% for voluntary admission of strict liability and up to 5% for evidence that the company has and applies a compliance program under the criteria of Chapter V. In the latter case, the maximum percentage is only granted where the program predates the unlawful act. Article 25 sets the limits: a minimum equal to the higher of the advantage obtained and 0.1% of the calculation base, and a maximum equal to the lowest of three times the advantage, 20% of gross revenue and BRL 60 million in the situation of Article 21.
Leniency agreement
Article 16 authorizes the highest authority of the body to enter into a leniency agreement with a legal entity that effectively cooperates, enabling the identification of the other parties involved and the swift production of information and documents. The requirements are cumulative: being the first to express interest in cooperating, fully ceasing involvement in the offense as of the proposal, and admitting participation while cooperating fully and permanently until the proceeding ends.
The effects are in paragraph 2: exemption from the extraordinary publication of the decision and from the ban on receiving public incentives and loans under Article 19, IV, and a reduction of up to two thirds of the fine. The agreement does not release the company from fully compensating the damage, and a breach bars a new agreement for 3 years (Article 16, paragraph 8). At the federal level, Decree No. 11.129/2022 details requirements and clauses, including the commitment to adopt or improve the compliance program and monitoring by the Office of the Comptroller General (Articles 37, 45 and 51).
What authorities assess in a compliance program
Article 56 of Decree No. 11.129/2022 defines a compliance program as the set of internal integrity, audit and whistleblowing mechanisms and procedures, with effective application of codes of ethics, to prevent, detect and remediate unlawful acts and to maintain a culture of integrity. Article 57 lists the assessment criteria, among them:
- visible commitment from senior management, with allocation of adequate resources;
- a code of ethics and policies applicable to everyone, extended to third parties where necessary;
- periodic training and communication;
- risk management with periodic reassessment and reliable internal controls;
- specific procedures for public bidding, administrative contracts and any interaction with the public sector;
- independence and authority of the body responsible for the program;
- a widely publicized whistleblowing channel, with protection for good faith reporters, and disciplinary measures;
- risk based due diligence for hiring and supervising third parties, politically exposed persons and sponsorships and donations;
- verification of irregularities and vulnerabilities in mergers, acquisitions and corporate restructurings;
- continuous monitoring of the program itself.
Article 57, paragraph 1, requires the company's size and specific features to be considered, including its status as a micro or small business, its sector and its degree of interaction with the public sector. Paragraph 2 is the most important for a company already in crisis: what is assessed is the effectiveness of the program in relation to the unlawful act under investigation. A paper program does not count at that moment.
Third party due diligence
Most exposure does not arise inside the company, but in the chain of agents, brokers, consultants and suppliers that speak to public authorities on its behalf. Due diligence proportional to the risk checks ownership structure and ultimate beneficial owners, sanction records in public databases, conflicts of interest and links to public officials, consistency between compensation and the service actually provided, and contractual clauses on integrity, audit and termination. Documenting that analysis is part of the protection: without evidence, the company cannot later demonstrate what it did beforehand.
How the firm can help
Oliveira & Jacobovitz structures and reviews compliance programs under the criteria of Article 57 of Decree No. 11.129/2022, drafts policies and codes of conduct, designs whistleblowing channels and internal investigation workflows, conducts third party due diligence and advises companies in liability proceedings and leniency negotiations, including the effects on public bidding and administrative contracts. Each case is assessed individually, with no promise of outcome.
