Corporate governance

Leniency Agreement

In late 2016, Odebrecht S.A. entered into agreements with the Federal Public Ministry of Brazil, the United States Department of Justice and the Swiss Attorney General’s Office relating to the investigation of unlawful acts committed for the benefit of companies that comprise Odebrecht.

R$ 3.8 billion

in fines and indemnities

The Chairman of the Board of Directors of Odebrecht S.A. and 76 other persons, including Group executives, agreed to cooperate in disclosing facts that constituted a violation of the laws of the three countries, including the U.S.-based Foreign Corrupt Practices Act (FCPA).

The agreement provides for the payment of fines equivalent to R$ 3.8 billion to the Treasury of Brazil, the United States, and Switzerland. In addition to this amount, Braskem, a company managed by Odebrecht, will be required to pay another R$ 3.1 billion in fines and indemnities to the Treasury of the three countries.

 

The agreement maintains the possibility of Odebrecht’s participation in public sector contracting, financing by government-controlled banks, and the maintenance of existing contracts, as well as ensuring that companies can resume operations without restrictions. The terms of the agreement also include the decision that, over the next two years, Emílio Odebrecht will remain in his position as Chairman of the Board of Directors of the holding company, with the main function of implementing the Governance and Compliance Systems, ensuring that they are in line with the highest standards and ensuring the succession of the company. The executives who participated in the agreement moved away from their decision-making functions at Odebrecht – 51 of them were dismissed and another 26 became advisors with no leadership or decision positions. Odebrecht will have external and independent monitoring for a period of two to three years, which will report to the U.S. Department of Justice and the Federal Public Ministry of Brazil on the evolution of the compliance with the terms of the agreement.

external and independent monitoring

for up to three years

 

In April 2017, the U.S. District Court of New York upheld the terms of the agreement with the U.S. Department of Justice. The following month, the Federal Judiciary in Brazil approved the agreement signed by Odebrecht S.A. with the Federal Public Ministry.

In early 2017, agreements were also initiated with the public authorities of the Dominican Republic, Colombia, Panama, Venezuela, Argentina, and Peru, so that similar agreements can be signed within each country. In the Dominican Republic, the Public Prosecutor approved in April an agreement in which Odebrecht is committed to pay a fine of $184 million, which will allow it to maintain its projects in the country and be hired by local government.