Odebrecht compliance efforts expand to infrastructure sector initiative, company official says

30 May 2018 2:39pm

25 May 2018. By Ana Paula Candil.

Since Odebrecht signed a $3.5 billion global settlement with US, Brazilian and Swiss anticorruption authorities in December 2016 after being ensnared in the huge "Lava Jato" corruption investigation, the construction company has intensified its compliance activities to improve its rules and implement new ones.

“The rules we created and implemented here are stricter and based on the best international practices because we needed a radical change,” Maria Cecilia Andrade, Odebrecht's antitrust, compliance and governmental affairs lawyer, told MLex in an interview.

Andrade said that the Brazilian company is making efforts not only to implement the compliance program internally, but also to improve the business environment in the infrastructure sector — initiatives that she said will be announced shortly, though she didn’t give further details on the antitrust and anticorruption project.

“We are lucky that Odebrecht’s leadership supports our compliance initiatives, otherwise we wouldn’t be able to implement any of these projects,” she said.

Odebrecht issued its first conduct code in 2013, when Brazil's anticorruption law was enacted. The construction company signed leniency agreements with authorities in December 2016 related to the Lava Jato probe, which involved allegations that companies paid bribes to do business with Brazilian state-controlled energy company Petróleo Brasileiro, or Petrobras.

Andrade, who had previously served as external counsel for Odebrecht, joined the company in 2016 to assist it and its subsidiaries in implementing its anticorruption compliance program.

In 2017, she was reassigned to antitrust compliance, where she is responsible for communicating with the Brazilian competition authority, the Administrative Council for Economic Defense, or CADE, on leniency agreements and investigations. She also represents the company abroad in relations with international institutions.

— Cartel vs. corruption —

When asked whether antitrust or anticorruption work is more challenging, Andrade said each has its own difficulties.

She said the anticorruption compliance system is based on prevention and involves multiple tasks: the creation of policies; control and risk assessment; training; collective action; risk monitoring; vetting suppliers; and remediating.

But antitrust work, she said, mostly depends on the conduct of individuals that is not so easy to monitor in a daily basis.

“In cartels or other antitrust violations, you have a gray area when it comes to monitoring, and for this reason it is also very important to invest in a lot of training. We are currently working intensively on that,” Andrade said.

Andrade said that companies operating in Brazil, especially those in the infrastructure sector, need to have compliance programs to contract with the government.

“You need a compliance program if you want to remain in the market,” she said.

She cited Rio de Janeiro as an example of a state that requires companies to have compliance programs to contract with the government, and said the Brazilian anticorruption law states that compliance programs are among the criteria used by authorities to reduce fines for wrongdoing.

“If you don’t fit, you are out of the market,” Andrade said.

Damage Limitation: Trucks & Cartel Claims