CGU and AGU release joint Ordinance on leniency agreements27/08/2019
Por: André Fonseca, Thaís Bratifich Ribeiro
On August 13th 2019, the Official Federal Gazette (DOU) published Joint Ordinance nº 04, which defines the procedures of negotiation, celebration and follow-up on leniency agreements prescribed by Law 12.846/2013 (“Clean Company Act”) within the Comptroller General’s Office (CGU), and also stipulates and role of the Solicitor – General´s Office for the Federal Government (AGU).
The new ordinance attempts to adequate the internal procedures of both agencies, given the new regimental structure of CGU and AGU after the creation, respectively, of a Leniency Agreement Directory, associated to the Anticorruption Secretariat (DAL/SCC/CGU), and a Department of Public Heritage and Probity of the Federal Solicitor-General.
According to the ordinance, after an analysis on the viability of a negotiation, a memorandum of understanding will be signed with the legal entity, in order to define the minimum standards for the negotiation, and a commission will be formed to conduct the procedure.
The legal entity must state it has been informed of its rights and legal duties, and that the noncompliance with CGU and AGU’s solicitations during the negotiation will entail in the termination of the initial proposal.
The committee will also be responsible for evaluating the company’s integrity program, pursuant to specific regulations of the CGU, and for proposing clauses and obligations aimed at the following results: effectiveness of the collaboration and the useful outcome of the process; commitment of the legal entity to promote changes in its governance that mitigate the risk of the occurrence of new illegal acts; obligation of the legal entity to adopt, apply or improve its integrity program; effective monitoring of the leniency agreement commitments; and the repair of the identified damage.
In addition, the commission must negotiate the amount of compensation for damages, preserving the obligation of the legal entity to fully repair the damage caused.
Finally, the committee shall submit a final report on the negotiations to the CGU Minister of State and to the Federal Attorney-General, as well as carry out the dialogue with national or international bodies, entities and authorities regarding the activities related to the agreements under negotiation.
Please note that at any time prior to the conclusion of the leniency agreement, the proposal may be waived by the proposing legal entity or rejected by the CGU or AGU.
Also, the withdrawal of the leniency agreement proposal or its rejection, under the terms of the Joint Ordinance, will not result in recognition of the injurious act investigated, and will imply the return, without retention of copies, of the documents presented, being forbidden the use of information obtained during the negotiation for accountability purposes, except when the Public Administration becomes aware of them by other means.
It should be stressed that the withdrawal of the proposal will not lead to its disclosure, except the legal entity authorizes the disclosure of the proposal, or its content.
The proposal will receive confidential treatment as a rule, but the Joint Ordinance provides the agreements will become public after their signature, except for the legal hypotheses of obligation of secrecy.
It should be noted that the execution of the leniency agreement may exempt the legal entity from the sanctions provided in item II of art. 6 and item IV of art. 19 of Law nº 12.846/13, reduce by two thirds the amount of the applicable fine, and exempt or mitigate the applicable administrative or civil sanctions. Once all the terms of the agreements are accomplished, it will be declared terminated.
Felsberg’s White-Collar Crimes, Corporate Investigations and Compliance Department is available to assist on compliance consulting services and related issues, to represent clients before government agencies in connection to audits, inspections and investigative procedures, as well as in providing any additional information. If you have any questions, please contact André Fonseca (firstname.lastname@example.org).
WHITE-COLLAR CRIME, CORPORATE INVESTIGATIONS AND COMPLIANCE
This article is intended exclusively to provide information and does not contain any opinion, recommendation or legal advice from Felsberg Advogados in relation to the issues addressed.