Office of the Comptroller General of Brazil

ANTI-CORRUPTION MEASURES IN BRAZIL

Enhancing the public-private collaboration
Jorge Hage Minister of State, Head of the Office of the Comptroller General of Brazil

Brussels, Belgium 27- 28 May 2009

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Anti-Corruption Legislation in Brazil

Constitutional provisions:
Article 74: Establishes the duties of internal control in the three Branches Article 129: Prescribes competencies of the Public Prosecutors Office Article 37, XXII: Establishes the penalties for acts of official misconduct in the Public Administration Articles 85 and 86: Responsability crimes committed by the President of the Republic.

Penal Code, which includes:

Active corruption of domestic officials (art. 333), Passive corruption of domestic officials (art. 317), Active bribery in international business transaction (art. 337 - B); Traffic of influence in international business transaction (art. 337 C).

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Money Laundering (Law 9.613/98) Official Misconduct Law (Law 8.429/92) Public Procurement Law (8.666/93) Violations against the economic order (Law 8.884/94) Executive Power Internal Control Law (Law 10.180/2001) Office of the Comptroller General of Brazil Law (Law 10.683/2003) Brazilian Court of Accounts Law (8.443/1992) Law 1,079/1950 Responsibility crimes procedural law

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Law on the Liability of Mayors and City Council Members (Decree-Law 201/1967) Attorney General Offices Organic Law (Complementary Law 73/93) Public Prosecutors Office Organic Law (Complementary Law 75/1993) Law on the obligation to report assets and income in the Executive, Legislative and Judiciary (Law 8,730/1993) Law on prevention and repression of criminal organizations activities (law 9,034/1995) Phone communication interception law (Law 9,074/1995) Administrative procedure for the Federal Public Administration (Law 9,784/1999)

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Public service corporations regulation Law (Law 8,987/1995) Victims and Witnesses Protection Federal Program Law (Law 9,807/1999) Fiscal Responsibility Law (Complementary Law 101/2000) Crimes against Public Finances (Law 10,028/2000) Law on the secrecy of Financial Institutions operations (Law 105/2001) E-procurement system Law (Law 10,520/2002) Regulation on Politically Exposed Persons (Circular 3,339/2006 of the Central Bank)

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Initiatives to improve the legal framework on the fight against corruption

Bill on Liability of Legal Persons for Acts of Corruption:
Civil and Administrative liability for acts of corruption committed by legal persons against the national and international administration. Liability of legal person maintained regardless of the prosecution or conviction of natural persons. Liability of legal person maintained regardless of incorporation, transformation or merger. Sanctions: fines; suspension of activities; revocation of operating privileges; prohibition on participation in public procurement bids and contracting with Public Agencies; prohibition on official financing; dissolution.

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Criminalization of illegal enrichment

Congress on June, 2005)

(bill sent to the National

Conflicts of interests
2006)

(bill sent to the National Congress on October,

Bill on access to information

May 2009)

(bill sent to the National Congress in

Civil Servant Asset Investigations (Executive Order) Control of resource transfers (Executive Order) Tackling Nepotism (cronyism) Regulation of Lobbying

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Federal Agencies responsible for combating corruption in Brazil

The Office of the Comptroller General of Brazil The Federal Police Department - Ministry of Justice The Federal Public Prosecutors Office The Financial Activities Control Council Brazils Financial Intelligence Unit The Federal Court of Accounts The Office of the Attorney General The Federal Revenue Secretariat The Department Cooperation of Assets Recovery and International

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The CGU, as the Internal Audit Unit and the Anti-Corruption Agency of the Brazilian Federal Government, implements the following actions: Management Advice Auditing - Referral of audit results to the agencies with responsibility for enforcement of the applicable sanctions - Disciplinary Actions - Corruption Prevention

- Internal Control

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Simplified Organization Chart CGU

Comptroller General
Public Transparency Parity Council

Executive Secretariat

Federal Internal Control Secretariat

Corruption Prevention and Strategic Information Secretariat

Disciplinary Board

Office of the Ombudsman

26 Regional Units

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Follow up of the results of the Audits

Congress Political Control Federal Departments
Management advice and Administrative Sanctions

CGU
Disciplinary Board

Brazilian Court of Accounts Office of the Federal Public Prosecutor Federal Attorney's Office Federal Revenue Service

Administrative Sanctions (External Control)

Criminal Lawsuits Civil Lawsuits

Judiciary Branch

Disciplinary Sanctions

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Main Prevention Measures

Increased Transparency E-procurement system Online monitoring of public expenditure List of Ineligible Firms - CEIS Incentive to Social Control Education for Ethics and Citizenship Implementation of International Conventions Public - Private Cooperation Against Corruption

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TRANSPARENCY INITIATIVES
The Transparency Portal provides information on:
Resources applied directly by the federal departments Federal resources transferred from the Federal level to the states, municipalities and Federal District. Federal resources transferred directly to the citizen. Transactions on the Federal Government's Payment Card.

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Direct Spending

Transparency Portal
Budget year

Transfers By state/county
Spending category

Punished Firms

Transfers to citizens

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Transparency Portal in Numbers: Amount displayed Information Pages visited 2008

Over US$ 3 trillion
782,130,780 entries

1,443,610
1.443.610

285.968
2005

377.078
2006

646.701

2007

2008

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Public Transparency Pages: Each Federal Body

Public Procurement Public Agreements

Budget Expenditure

Contracts

Per Diems and Tickets

389 Public Transparency Pages: 44 State Owned Enterprises with Transparency WebPages

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International Awards UNODC Award

Important work in promoting transparency in public spending UNCAC States Parties Conference Bali 2008 One of the five best practices in the field of transparency and anti-corruption strategies in the world

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Brazilian e-procurement system

Comprasnet Portal
COMPRASNET is the access point to the Brazilian Federal Governments eprocurement system. The portal enables users to view information on all Federal Government purchases of goods and services and to participate in the e-procurement process.

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Spending Watcher
data-matching and tracking system

Spending Watcher
1. 2. 3. 4. 5. 6. 7. 8. 9.

Monitored Tracks

COLLUSIVE BEHAVIOUR BIDDER FIRMS AMOUNTS BEYOUND THE LEGAL THRESHOLD MORE THAN ONE EXCLUSIVE SUPPLIER INSUFFICIENT TIME FOR BID SUBMISSION BIDS REGISTERED ON NON-BUSINESS DAYS INAPROPRIATE EXEMPTION OF PROCUREMENT IMPROPER PROCUREMENT BIDDERS WITH SAME ADDRESS NEWBORN FIRMS

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List of Ineligible Firms - CEIS

133 firms declared ineligible

777 firms temporarily suspended

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133 ineligible and 777 suspended firms

Firms identification

Identification of the Public Body responsible for the sanction

State

Source of information

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Incentive to Social Control

The Office of the Comptroller General (CGU) developed the Keeping a Sharp Eye on Public Money Program, with a view to promoting change in society through education, access to information and social mobilization. To promote social control, the CGU also developed the CGUs Online School, offering course programs in: 1. Internal Control; 2. Social Control; 3. Social Control of the Government Education Programme FUNDEB; 4. Public Procurement and Contracts.

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Kids Website
www.portalzinho.cgu.gov.br

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Project One for All and All for One for Ethics and Citizenship
Um por Todos e Todos por Um pela tica e Cidadania

Partnership between the CGU and Maurcio de Souza Institute, a non-governmental organisation. Designed to foster citizenship, ethics and responsibility among participants: educators, students, families and communities.

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Implementing International Conventions Against Corruption

The CGU prepared handbooks and pamphlets aimed at disseminating the terms of the OECD Convention against Corruption. In addition, the agency developed a web site with information on the Convention.

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UN CONVENTION WEBSITE

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OECD CONVENTION WEBSITE

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OAS CONVENTION WEBSITE

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Public-Private Cooperation Against Corruption

Distribution of pamphlets on the OECD Convention to over 20,000 enterprises; Research conducted with over 450 Brazilian enterprises to identify the anti-corruption and integrity measures adopted by enterprises; Preparation and distribution of Ministerial Letters to 45 of the biggest export companies to raise awareness of the OECD Convention and of the integrity methods for fighting corruption.

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Public-Private Cooperation Against Corruption CGU and Ethos Institute Partnership:

CGU and Ethos established a partnership aiming at : - Stimulating and putting into force initiatives to strengthen good practices of corporative governance - Promoting ethics and integrity in the relationship of public and private sectors.

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The Ethos Institute:

The Ethos is a NGO created to help companies achieve a socially responsible corporate governance Mission: Mobilizing, sensitizing and helping companies to manage their businesses in a socially responsible manner, making them partners in the construction of a fair sustainable society.
Ethos is one of the institutions responsible for the development of the Pact Against Corruption and for Integrity, signed by over 500 companies, including all major companies in Brazil.

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The Permanent Working Group, established to strengthen implementation of the principles set forth in the Pact Against Corruption and for Integrity and composed of 24 signatories and observer members, is tasked with: 1. Evaluating and considering effective measures to fulfil the commitments provided for in the Pact; 2. Expanding mobilization and enlistment of not-for-profit companies and entities; 3. Generating information and references to help companies promote integrity and fight corruption, and; 4. Integrating anti-corruption networks.

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Clean Company Campaign

Designed by the Ethos Institute, the Clean Company stamp is conferred to signatories of the Pact Against Corruption and for Integrity. The stamp certifies a companys commitment to eliminating all forms of corruption from the corporate environment and compliance with twice-yearly evaluations of the progress made to this end. www.empresalimpa.org.br

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Initiatives being implemented by the CGU - Ethos Partnership

Handbook on Fighting Corruption in the Private Sector: aimed at strengthening the dialogue between the public sector and the private sector for purposes of supporting private initiatives to promote integrity Distance course handbook above offering on the

Handbook and distance course for SMEs (smalland medium-sized enterprises), inspired by the experiences of Colombia: Rumbo PYMES Integras y Transparentes.

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CGU - Ethos Partnership Initiatives

- Mapping of initiatives/entities aimed at promoting integrity in the private sector, with a view to disseminating principles and initiatives - Co-ordination of actions within MERCOSUR designed to give publicity to methodologies and tools to promote integrity in the business sector, as well as to establish corporate pacts in partnership with organisations in the MERCOSUR countries - Development of a handbook for both the private and public sectors identifying and providing information on illicit practices and the primary forms of bribery in public-private relationships - Discussions with the Working Group of the Pact Against Corruption and for Integrity on the inclusion of a clause establishing a commitment by signatories to avoid doing business with firms entered in the Transparency Portals List of Ineligible Companies. Meeting with the 7 major Auditing and Corporate Consulting Companies in Brazil to foster initiatives to strengthen good practices in corporate governance.

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Thank you!
Jorge Hage
Minister of State, Head of the Office of the Comptroller General of Brazil

CONTROLADORIA-GERAL DA UNIO Setor de Autarquia Sul, Quadra 1, Bloco A Edifcio Darcy Ribeiro - CEP: 70070-905 Braslia - DF Brazil

www.cgu.gov.br

jorge.hage@cgu.gov.br