The University of Richmond’s Journal of Global Law & Business is proud to announce its annual Corruption Issue. In this series of posts, each co-authored by a UR law student and Professor Andy Spalding, we’ll introduce this year’s articles and invite submissions for next year’s issue.
In the wake of Brazil’s “Mensalo” scandal and Petrobras investigation, and the alleged corruption in Sochi, is Brazil’s Clean Companies Law enough to stop rumors of Olympic corruption?
Both the FCPA and the Clean Companies Law aim to increase transparency. The Clean Companies Act not only mirrors much of the FCPA, but also goes beyond the current iteration of the FCPA by holding businesses to stricter standards. The real test, however, will be in the law’s implementation.
In their article, The Penumbra of the United States Foreign Corrupt Practices Act: Brazil’s Clean Companies Act and the Implications for the Pharmaceutical Industry (available from ssrn here), Beverly Earle and Anita Cava review Brazil’s Clean Companies Act through the lens of its domestic effect on the pharmaceutical industry. They focus on the law’s goal of shedding light on gifts provided to prescribing physicians and healthcare providers.
While Earle and Cava draw similarities to the FCPA, it should be noted that another comparison to the Clean Companies Act in this regard would be the United States’ 2010 Physician Payments Sunshine Act. Both are recently passed pieces of legislation aimed at exposing potential conflicts of interest that arise when health care providers receive gifts from manufacturers of pharmaceuticals or medical devices.
If Brazil wants to make sure its image remains clean, it may do well to pay attention to the successes and failures of the implementation of both the FCPA and the Physician Payments Sunshine Act. Successful implementation of the Clean Companies Law prior to 2016 will go a long way toward heading off the damaging corruption rumors that have attended the more recent Olympics.
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The Richmond Journal of Global Law & Business is now accepting articles for publication in its annual bribery and corruption survey. We prefer mid-length articles (around 12,000 words, with a maximum of 18,000 words, including footnotes). If you would like to submit an article for consideration, or discuss the possibility, please contact Chris Rohde here. Articles will be considered through February 15, 2015.
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Shaun Frieman is a third-year student at the University of Richmond School of Law, and Managing Editor of the Journal of Global Law & Business.
Andy Spalding is Senior Editor of the FCPA Blog and Assistant Professor at the University of Richmond School of Law.
2 Comments
Most anti-corruption efforts focuses on the passing of laws and regulations. The question remains the same as those faced by criminologist for years. Can the passing of laws force the change in cultural unethical behavior? Can behavior that is rooted in cultural norm be changed with laws only? Maybe there need to be another approach to anti-corruption efforts that will include not only new regulations, but culturally based education that can change attitudes on dishonest behavior.
In the wake of Brazil’s “Mensalao” scandal and Petrobras investigation, and the alleged corruption in Sochi, is Brazil’s Clean Companies Law enough to stop rumors of Olympic corruption?
Unfortunately, corruption practices in Brazil are widespread and subliminally accepted as a "normal" way of doing business (strongly concentrated in Government contracts).
However, I would like to believe that the Brazilian Anti Corruption Act will start a new phase of increasingly more honest and ethics contracts.
The legislation itself is a poor copy of the FCP act in some aspects (the Brazilian Law gave powers to Federal, State and Municipal authorities to prosecute companies instead of concentrating the investigation process between the equivalent of the "DOJ" and "SEC in US).
Just a quick example on how complex and risky it can become: Brazil has more than 5.000 cities – if you have a company with business in 5 cities located in 5 different states, you may wake up some day dealing with 11 different subpoenas (5 from each state, 5 from each city and 1 from the Union – so far they can act on their own against a supposed corruption act practiced by a company). And it can be worst: these 11 Government entities may end up receiving a lot of money in penalties against the companies by doing that – it rings any bell for more suspected practices?
On the other hand, there are a lot of talented and well intentioned people working on the Brazilian Anti Corruption Act regulamentation.
I hope they will have the strength and courage to overcome the crowd (people in both Government and Companies) that build fortunes based on corruption practices since Brazil was discovered by Pedro Alvarez Cabral.
Best, Sandro Melo
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