ASSESSMENT 2020 LATIN AMERICA ANTICORRUPTION - Latin America Anticorruption Assessment 2020
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Latin America Anticorruption Assessment 2020
LATIN AMERICA ANTICORRUPTION
ASSESSMENT 2020
Latin America Anticorruption Assessment 2020
Latin America Anticorruption Assessment 2020
Abbreviations and Acronyms ........................................................................................................................i
Executive Summary ......................................................................................................................................ii
Introduction ................................................................................................................................................ iv
Methodology ........................................................................................................................................... v
Scores ........................................................................................................................................................ vii
I. Argentina .........................................................................................................................................1
II. Brazil ................................................................................................................................................6
III. Chile ............................................................................................................................................... 11
IV. Colombia ........................................................................................................................................ 14
V. Guatemala ..................................................................................................................................... 18
VI. Mexico ........................................................................................................................................... 22
VII. Panama .......................................................................................................................................... 27
VIII. Peru ............................................................................................................................................... 30
Regional Analysis ....................................................................................................................................... 34
Regional Recommendations ....................................................................................................................... 36
Acknowledgements.................................................................................................................................... 38
The Lawyers Council ................................................................................................................................... 40
Final Notes ................................................................................................................................................. 41
DIGITAL VERSION
http://bit.ly/LCEAL20
Abbreviations and Acronyms
Abbreviations
Section Meaning
or Acronym
LP Legal Professionals
General CSOS Community Organizations
OECD Organization for Economic Co-operation and Development
Guatemala CICIG International Commission against Impunity in Guatemala
México SNA National Anti-Corruption System
i
Executive Summary
The Anti-Corruption Assessment in Latin America Country Final Score
2020 is a regional study involving eight countries Chile 7.86
(Argentina, Brazil, Chile, Colombia, Guatemala, Argentina 5.95
Mexico, Panama, and Peru), which delineates legal Peru 5.86
efforts to prevent and combat corruption. Unlike Brazil 5.67
other efforts that focus on measuring corruption or Colombia 5.60
its perception, this study follows a strictly legal Mexico 5.51
approach to analyze legislative and regulatory efforts, Panama 3.97
in addition to the institutional framework, aimed at Guatemala 3.89
preventing, targeting, and prosecuting corruption. This report highlights the following findings:
This report addresses the perspective of legal Argentina’s legal framework is generally
professionals (hereinafter “LP” or “legal satisfactory, but its most significant shortcoming
professionals”) engaged in anti-corruption practice in involves inadequate regulatory implementation
various sectors, including law firms, businesses, resulting from the lack of (i) political will; (ii) political
academia, civil society organizations (hereinafter independence of the anti-corruption agencies; (iii)
“CSOs”), human rights defenders, and others. economic and human resources; and (iv) formal
This study addresses for each of the countries mechanisms for civil society engagement and
reviewed eight aspects that are key to the fight participation. Brazil’s legal framework has notably
against corruption: public and private sector improved but, in addition to undue political influence
corruption; complaint mechanisms; whistleblower and a lack of political will to effectively implement
protection; specialized agencies; institutional the anti-corruption legal framework, there is a need
coordination mechanisms; civil society engagement to establish corporate criminal liability in connection
and participation; and transparency and access to with acts of corruption. Chile’s regulatory framework
information. is generally effective, and the governmental agencies
and authorities have the capacity and political
The information obtained through two
independence to implement effectively the anti-
questionnaires completed by lawyers from member
corruption regime. Colombia shows inadequate
firms of the Lawyers Council for Civil and Economic
implementation due to lack of political will and
Rights (hereinafter the “Lawyers Council”) and
absence of mechanisms for detecting and preventing
members of the legal community of the countries
corruption.
evaluated, was divided into three categories: legal
framework; implementation; and governmental In Guatemala, the legal framework is deficient and is
bodies. With this information, the methodology characterized by significant institutional weakness.
developed an overall score awarded to each country Anti-corruption efforts are led by certain individual
on a scale from zero (lowest) to ten (highest). Of the government officials rather than by
overall ratings, Chile scored the highest and institutions. Despite having a solid and
Guatemala the lowest. comprehensive legal framework, Mexico stands out
for a lack of regulatory implementation and reduced
ii
Latin America Anticorruption Assessment 2020
institutional capacity. In addition, anti-corruption With regard to implementation of the anti-corruption
authorities are subject to political influence. Despite legal framework, both the lack of political will and of
being the only jurisdiction that maintains a beneficial independence of institutions represent the main
ownership registry, Panama displays a deficient legal obstacles in preventing, targeting and punishing
framework and a lack of institutional capacity and corruption. In some countries, the lack of political
fundamental elements required to combat independence of the judiciary and criminal
corruption. Finally, Peru has one of the strongest prosecutors, and the need for more human and
legal frameworks, but its implementation is financial resources essential to countering corruption,
negatively affected by flaws in procedural rules and a are of great concern. Although there are significant
lack of political will. advances in transparency as a mechanism to prevent
corruption, only Panama has a registry of beneficial
This regional analysis shows that most Latin
ownership of companies in place and is making
American countries follow an ex-post facto approach
efforts to implement it. Finally, in no country was
of sanctioning corruption through the criminal
there an emphasis on human rights in the fight
system. Preventive efforts to reduce corruption, in
against corruption. This has broad implications in the
both the public and private sectors, are insufficient.
exercise of the rights of victims of corruption and in
Similarly, important factors to countering corruption,
their ability to obtain redress as a result.
including institutional coordination mechanisms,
incentives to file complaints, and rules providing for The country and regional recommendations in this
community engagement and participation in anti- report sound a call to action for the legal community
corruption efforts are practically non-existent or to address the above-mentioned challenges. These
minimal. recommendations highlight the importance of
promoting 1) the use of technology in the
Anti-corruption mechanisms and efforts in the public
development and implementation of mechanisms to
sector are focused on the executive branch, and
prevent corruption, 2) regional cooperation and the
largely absent in other governmental agencies and
involvement of the private sector and the legal
institutions. Regarding corruption in the private
community in promoting best practices and 3)
sector, most countries have anti-corruption
establishing an anti-corruption rapporteur within the
compliance programs in place. However, their
Inter-American Human Rights System.
implementation is optional and, except in one
instance, there are no clear compliance and
enforcement guidelines available.
iiiIntroduction
foreign investment, and retaining national
Corruption is a global phenomenon that affects the
investment, which can go elsewhere in the absence
rule of law and the protection of fundamental rights
of investor protection. The rule of law is particularly
of individuals. From a regional perspective,
important for retaining and attracting capital. It is
corruption in Latin America has had a significant
important to recognize that, regardless of nationality,
impact on government administrations and the public
any investment analysis involves comparing potential
sphere, thus becoming one of the largest and most
investment alternatives based on the reliability of the
complex problems that citizens identify in their
rule of law (including legal and judicial protection
society and environment. Controlling corruption has
against the arbitrary use of power), the security of
thus become an increasing priority on the public
individuals, and the ability to prevent and combat
agenda of the countries of the region. National,
corruption. In addition to developing a business plan,
federal, or regional administrations have issued
investors assess the rule of law across jurisdictions
general rules and approved public policies to prevent,
and, particularly in connection with government-
investigate, prosecute, and punish corruption-related
related businesses, analyze the anti-corruption
wrongdoing by public officials and individuals. In turn,
enforcement regime, including the feasibility of
civil society organizations, lawyers, schools, and
mitigating the risks of state corruption, excessive
universities among other groups, have become a
delays or unpredictability in regulatory and judicial
significant counterweight to the lack of proper
decision-making, and other divergences from the rule
implementation of anti-corruption legal frameworks
of law. Risks of this kind raise the perceived cost of
of countries across the region.
doing business and, for law-abiding companies, deter
The Lawyers Council, composed of leading lawyers investment.
representing various countries of the American
It is also important to note that corruption is highly
continent, managed by the New York City-based
associated with reduced confidence in governmental
Cyrus R. Vance Center for International Justice,
authorities, poorer tax collections
considers corruption to be one of the scourges that
and underinvestment in infrastructure.
most affect the rule of law globally, given its
complexity and difficulty in tracing and disciplining. In addition, the intersection between corruption and
The welfare of a society depends on the proper human rights is becoming increasingly evident in
functioning of the rule of law, as a basis for the matters that have direct impact and implications in
exercise of civil and economic rights and for a the enjoyment of human rights. The Inter-American
prosperous national economy. In the absence of legal Commission on Human Rights, in its "Thematic
protection, both economic development and the Report of the Inter-American Commission on Human
exercise of human rights are adversely affected and Rights "Corruption and Human Rights: Inter-American
can deteriorate. Human rights violations, impunity, Standards,"1 has concluded that corruption has a
violence, and insecurity flourish in a corrupt system. negative impact on human rights in general, and
particularly on economic, social, cultural and
As lawyers dedicated to the practice of private law,
environmental rights, as it affects the availability of
we acknowledge the key importance of the rule of
resources, generates discrimination and ultimately
law in achieving economic development, attracting
poverty, and increases inequality and impunity.
ivLatin America Anticorruption Assessment 2020
From a human rights point of view, corruption also o Public sector corruption
affects judicial rights recognized by international and o Private sector corruption
regional human rights standards. Additionally, there o Complaints and whistleblower protection
is particular concern about the impact that corruption o Specialized agencies
can cause on certain individuals such as vulnerable o Institutional coordination mechanisms
groups and people living in poverty. o Community participation
o Transparency and access to information
This assessment seeks systematically to map and
guide legal efforts in Latin America to prevent and The report also presents a series of general and
combat corruption. This first edition of the Anti- specific country recommendations and a regional
Corruption Assessment in Latin America 2020 analysis that identifies similarities, trends, and
assesses eight countries of the region regarding their differences across the region.
legal framework and its implementation in practice: The countries in the report are presented in
Argentina, Brazil, Chile, Colombia, Guatemala, alphabetical order.
Mexico, Panama, and Peru.
The Lawyers Council hopes that, with this initiative,
Unlike other efforts that focus on measuring Latin American advocacy will find specific paths to
corruption or the perception of corruption, this systemic improvement of anti-corruption legislation
assessment employs a legal practice perspective, and its implementation in the region.
focused on regulatory efforts and the institutional
The assessment also seeks to serve, beyond a purely
framework to prevent, target and prosecute
academic effort, as a call to action for the legal
corruption in each country. It addresses the
community, a tool to catalyze discussions among
perspective of legal professionals engaged in anti-
lawyers in different fields and ultimately lead to the
corruption practice in various sectors, including
reform, implementation, and enforcement of anti-
practice in law firms, companies, academia, civil
corruption practices. The Lawyers Council and the
society organizations and human rights defenders,
Vance Center will use the report to guide their efforts
among others.
to collaborate with the legal community of each
This report includes eight sections with an analysis by country in the region on the legal frameworks, ethical
country, divided into seven parts that correspond to guidelines and business practices needed to combat
relevant issues of the anti-corruption legal corruption effectively.
framework:
METHODOLOGY
For this report, the Lawyers Council developed, with
Based on the information gathered, two
the support of law firms and an expert consultant, a
questionnaires were developed and addressed to the
database of sources (international and regional
legal community. “Questionnaire 1” was completed by
treaties, reports, model laws and international
attorneys belonging to Lawyers Council2 member
guidelines) applicable to each of the anti-corruption
firms, with 35 questions (involving 72
obligations under the United Nations Convention
variables) divided into the following eight sections:
against Corruption.
1) Anti-corruption framework and legislation
vLatin America Anticorruption Assessment 2020
2) Anti-corruption preventive policies and practices for these sub-categories was assigned a score, accounting
the public sector for the number of sub-categories, adding up to the 10
3) Corruption in the private sector points of the corresponding category.
4) Whistleblower complaints and r protections
5) Strength and independence of anti-corruption Each sub-category, according to Questionnaires 1 and
agencies 2, had a number of possible variables, and on these
6) National and International cooperation and variables, each country was assigned the
coordination corresponding sub -category score. For example, the
7) Participation of civil society and of academia “General Legislation” sub-category of the “Legislation”
8) Access to information category has a total of 16 variables, equivalent to
“Questionnaire 1” aimed to obtain information on 2 points. If a country had 8 of the 16 possible variables,
these eight subjects derived from legislation, then the assigned score would be half, equivalent
regulation, and practice. The questionnaire was to 1 point (out of 2 points).
completed in the last quarter of 2020. For the “Implementation” and “Authorities”
“Questionnaire 2” had 16 open-ended and multiple- categories, the information in “Questionnaire 2” was
choice questions (involving 20 variables) with the aim used and the same process described above was
of complementing the information in “Questionnaire followed.
1” focusing on the broader anti-corruption practices of To obtain the final rating, a percentage was assigned
the legal community. This survey was translated from to each category, leaving 30% to “Legislation”, 30% to
Spanish into English and Portuguese and distributed “Implementation” and 40% to “Authorities”. A higher
widely among the legal community of the participating percentage was assigned to the “Authorities” category,
countries.3 because the degree of independence and capacity of
To assign a score, the data from the anti-corruption authorities is crucial to the anti-
questions collected were divided into three corruption practice of the legal community and civil
categories: Legislation, Implementation and society in the region, as will be addressed in the
Authorities. Each category was assigned 10 points in assessment of each country.
total and, in turn, was divided into sub-categories .
according to the themes of the questionnaires. Each of
viScores
The final score is displayed on a scale from zero (0) to ten (10), where zero is the lowest score and ten is the highest.
The ratings by categories follows, ranked from highest to lowest:
viiArgentina Brazil Chile Colombia Guatemala Mexico Panama Peru
Points Points
Points Points Variable Points Points Points Points Points
Categories and sub-categories Variables
assigned
Variables assigne Variables
assigned s assigned
Variables
assigned
Variables
assigned
Variables
assigned
Variables
assigned
Variables assigne
d d
A. Legislation (30%)
1. General legislation 16 2 13 1.63 12 1.50 14 1.75 9 1.13 11 1.38 15 1.88 9 1.13 13 1.63
2. Anti-corruption preventive policies and practices for the
15 1 14 0.93 10 0.67 14 0.93 15 1.00 5 0.33 14 0.93 7 0.47 13 0.87
public sector
3. Corruption in the private sector 25 1 22 0.88 14 0.56 24 0.96 19 0.76 14 0.56 22 0.88 8 0.32 22 0.88
4. Whistleblower complaints and protections 2 1 2 1.00 2 1.00 0 0.00 1 0.50 0 0.00 1 0.50 0 0.00 2 1.00
5. Existence of specialized authorities 1 2 1 2.00 1 2.00 1 2.00 1 2.00 1 2.00 1 2.00 0.50 1.00 1 2.00
6. National and international cooperation and coordination 5 1 5 1.00 5 1.00 5 1.00 5 1.00 4 0.80 5 1.00 4 0.80 5 1.00
7. participation of civil society and of academia 1 1 0 0.00 1 1.00 1 1.00 1 1.00 0 0.00 1 1.00 1 1.00 1 1.00
8. Access to information 7 1 5 0.71 3 0.43 4 0.57 7 1.00 3 0.43 6 0.86 6 0.86 5 0.71
Total 10 8.15 8.16 8.21 8.39 5.50 9.05 5.57 9.09
B. Implementation (30%)
9. Challenges to the implementation of the anti-corruption
12 4 4 1.33 3 1.00 6 2.00 3 1.00 2 0.67 3 1.00 2 0.67 3 1.00
legal framework in your country
10. 9. Challenges to the implementation of anti-corruption
laws or regulations, due to a lack of specificity, clarity, or
1 4 0 2.00 0.5 2.00 1 4.00 0 2.00 0.2 0.80 0.5 2.00 0.3 1.20 0.5 2.00
definition in relation to other laws or regulations, or other
deficiencies.
11. Mechanisms for the protection of whistleblowers and
1 2 0.5 1.00 0.65 1.30 1 2.00 0.5 1.00 0.6 1.20 0.50 1.00 0.5 1.00 0.5 1.00
access to official channels for reporting corruption
Total 10 4.33 4.30 8.00 4.00 2.67 4.00 2.87 4.00
C. Authorities (40%)
12. Independence of anti-corruption authorities 1 5 0.5 2.5 0.4 2.00 0 3.50 0.4 2.00 0.2 1.00 0.3 1.50 0.2 1.00 0.4 2.00
13. Institutional capacity with respect to effectiveness and level
5 5 3 3 2.83 2.83 4 4.00 2.7 2.70 2.6 2.60 2.5 2.50 2.6 2.60 2.83 2.83
of impunity
Total 10 5.50 4.83 7.50 4.70 3.60 4.00 3.60 4.83
Final score Out of 10: 5.95 5.67 7.86 5.60 3.89 5.51 3.97 5.86
viiiI. ARGENTINA
ü Policies and procedures for identifying and
Total Legislation Implementation Authorities managing conflicts of interest
ü Gift acceptance policies for public officials
5.95 8.15 4.33 5.5
ü Policies on post-public employment obligations,
Argentina has a comprehensive anti-corruption policy and restrictions on public officials working in the
framework that includes over thirty-eight general rules private sector after concluding their public service
and regulations governing ethics in the public sector4, ü Policies for training public officials in anti-
powers of the anti-corruption agency5, sworn corruption measures
affidavits6, anti-corruption strategy7, public Regarding sworn affidavits, the Argentine legal
8
employment disqualification , corruption-related framework provides that the following are publicly
crimes and criminal liability for corporate entities10,
9
available:
and a regime governing the contracting of public goods
ü Asset Declarations
and services.11
ü Statements of activities, including external
According to the LPs consulted, the anti-corruption legal activities and participation in companies and
framework is generally adequate, but there are areas of organizations
opportunity for improvement. In general, LPs agreed ü Information on filing tax-related returns (payments
that the ”law on the books” is not actually implemented, and refunds)
accounting for the existing challenges faced at the The agency that oversees and coordinates the
different levels of implementation, including the federal implementation of anti-corruption policies is the Anti-
system. Corruption Office of the Ministry of Justice and Human
The main challenges in connection with the Rights.
implementation of Argentina's anti-corruption legal LPs have identified issues with the existing Ethics Act,
framework, involve lack of political will, of judicial including those that have also been identified by the by
independence and of political autonomy of the anti- the Organization for Economic Cooperation and
corruption authorities, in addition to inadequate Development (OECD), as well as the challenges in its
economic and human resources available to anti- implementation throughout the country. These include
corruption agencies, an absence of inter-agency an inadequate institutional design and deficiencies in
coordination, and restrictions on CSOs to counter assigned functions. In addition, the Anti-Corruption
corruption. Office reportedly only focuses on the executive
Moreover, lower social and economic sectors were branch and does not address the legislative and judicial
identified as those most affected by corruption. counterparts.
B. PRIVATE SECTOR
A. PUBLIC SECTOR Argentina has an anti-corruption regulatory framework
for the private sector. Of the elements analyzed in this
Argentina’s anti-corruption policies include:
evaluation, Argentina addresses most of the following,
ü Standards and codes of conduct for the adequate as noted below:
performance by the public sector
1Latin America Anticorruption Assessment 2020
ü Codes of Conduct provide companies greater certainty when
ü Standards for a culture with “tone at the top”12 encountering these scenarios.
ü Control and audit measures
Most LPs agree that the Law on Criminal Responsibility
ü Risk advice for regulatory compliance programs
of Legal Persons has been an important step forward in
ü Internal complaints procedures
regulation which has spurred anti-corruption policies
ü Research protocols
ü Training in compliance programs within companies. In addition, this law foresees that
ü Risk assessment and evaluation of compliance Argentina would comply after several years with the
programs international obligations assumed in this field by the
OECD framework. However, a repeated comment by
û Organizational chart and scope of the work of
participants is that there is currently insufficient
corporate officers
information on compliance of such as guidelines and
Pursuant to Law 27,401, Law on Criminal Responsibility directives, and therefore legal persons do not have all
of Legal Persons, the judge may consider failure to the elements to fulfill their obligations under the
comply with these elements as a factor for setting criminal liability system. In addition, the standard
penalties. Under this law, compliance with anti- reportedly does not account for the size or type of legal
corruption measures (implementing an integrity entity in order to determine the minimum elements or
or compliance program with all legal requirements or requirements that a legal entity should implement in
minimum standards provided by the law) is a developing a compliance program that meets the
requirement for contracting with the Government. The requirements of the legislation. This, in turn, results in
application of anti-corruption measures is otherwise not significant transactional costs and in compliance goals
mandatory for other private legal entities; although it that are challenging for smaller entities.
can be a mitigating liability factor in connection with any
The Argentine legal system also prohibits the following
penalty that a judge may impose if private legal entities
acts:
are involved in corruption.13
ü Establishment of accounts not recorded in
Private sector companies in Argentina are subject
corporate books; carrying out unregistered
exclusively to criminal responsibility and not to
transactions; the recording of nonexistent
administrative or civil liability. According to the expenses, the use of false documentation, and the
Repentance Act (Law 27,304), judges may reduce intentional destruction of corporate books.
sanctions on those who, having committed a particular ü Bribery or facilitation payments, as well as their
crime, if they provide relevant and substantial corresponding tax deduction.
information to the advancement of the related
investigation. LPs noted that this has led to positive C. REPORTING MECHANISMS AND PROTECTION FOR
progress in the context of relevant processes, such as WHISTLEBLOWERS
the “Caso de los Cuadernos.”14 However, they also
Public servants have the obligation to report crimes of
suggested that the penalty should not only be reduced
which they are aware in the exercise of their functions,
but that there be the possibility of eliminating it.
in accordance with criminal procedural law but absent
LPs noted that the legislation criminalizing companies any specific rules.
for bribes to public officials and other related
Regarding the ongoing debate as to whether existing
misconduct (Law 27,401) has not yet been applied in
complaint mechanisms are readily available to citizens,
specific cases and has deficiencies in its drafting,
LPs concluded that a change in implementation of these
particularly in situations such as self-reporting and
mechanisms is required.
cooperation with the government that if solved, would
2Latin America Anticorruption Assessment 2020
The anti-corruption framework defines specific The anti-corruption authorities do not have the
protective measures for whistleblowers. Law necessary independence to prevent, investigate and
15
25,764 created the National Program for the prosecute corruption effectively.
Protection of Witnesses and Accused Persons, which,
while not exclusive to corruption offenses, may be LPs rate the institutional capacity of public bodies
extended to such misconduct at the discretion of the empowered to prevent, investigate, and prosecute acts
judicial authority and the Ministry of Justice and Human of corruption as low.
Rights. Protection measures (no compensation
The Office of the General Prosecutor for Administrative
measures are provided) include: (A) personal or home
Investigations was identified by participants as the most
custody; (b) temporary housing in reserved places; (c)
effective authority in combating corruption and the
change of domicile; (d) provision of economic and
Anti-Corruption Office as the least effective.
housing resources for up to six months; (e) assistance in
handling administrative paperwork and procedures; and Most of the experts agreed that the lack of
(f) assistance in labor reintegration. independence of the Anti-Corruption Office is an
impediment to its effective action, as its performance is
The Criminal Code provides for reductions in penalties
governed by the policy of each administration and by
for corruption offenses to those who provide valuable
political interests. In this regard, the Anti-Corruption
and credible information. The complainants are liable,
Office has recently relinquished its role as a plaintiff in
according to the Repentance Act (Law 27,304), if they
certain corruption cases initiated under the prior
report acts of corruption to the press or media.
administration involving officials of the current
D. SPECIALIZED AUTHORITIES administration (regarding alleged acts committed while
serving under the prior administration). The lack of
The national authorities with powers to prevent,
budgetary independence and the reduction of the
investigate or punish acts of corruption are:
budget of this office were also identified as one of the
ü Anti-Corruption Office (Oficina Anticorrupción) problems.
ü General Prosecutor of Administrative
Within the identified challenges, the interference by
Investigations of the Office of the Attorney General
political and economic powers plays a key role in this
of the Nation (Procuración General de
lack of independence, especially in the selection
Investigaciones Administrativas de la Procuración
General de la Nación) processes of judges, in disciplinary procedures, as well
ü Judiciary (Poder Judicial) as in the periodic monitoring of their performance.
ü Financial Information Unit (Unidad de Información An additional challenge identified by LPs were lengthy
Financiera) procedures and significant delay in the processing and
While the Anti-Corruption Office is part of the executive resolution of investigations carried out by the relevant
branch and its head is directly appointed by authorities.
the President of the Nation, the General Prosecutor for
E. INSTITUTIONAL COORDINATION MECHANISMS
Administrative Investigations is part of the Office of the
Attorney General and has a more complex appointment There is no mechanism for institutional cooperation or
process in which it is selected from a pool of candidates coordination to prevent, target, investigate and punish
proposed by the Attorney General to the President, and, corruption-related misconduct. LPs noted that the
in turn, ratified by the Senate by a simple majority. ineffective action by the authorities is not only due to
lack of independence of the public authorities, but also
According to LPs:
due to the lack of an adequate budget and to deficient
institutional coordination. In particular, LPs have
3Latin America Anticorruption Assessment 2020
reported that Argentina does not have a centralized Plan 2019 – 2023. According to LPs, this council is mainly
system of data analysis and information gathering and composed of CSOs and business chambers. While this is
that the lack of coordination among public agencies a step forward in civil society engagement, the way in
hampers communication and effectively identifying and which actual participation by civil society will be carried
targeting cases of corruption. forward, and the involvement of the Council, are yet to
be specified.
F. CIVIL SOCIETY PARTICIPATION
Finally, LPs highlighted the role that the private
The legal framework does not provide for a mechanism
sector can play in advancing anti-corruption efforts,
that fosters civil society engagement and participation
particularly in terms of bidding and contracting
of academia and other non -governmental actors in
procedures.
corruption prevention efforts. Despite this, civil society
organizations have been involved in and have promoted G. TRANSPARENCY AND ACCESS TO INFORMATION
anti-corruption initiatives, such as the “ Anti-Corruption
In Argentina, information regarding public officials and
Social Agreement ”.16
sanctioned private entities is publicly available. Public
Although CSOs are identified by LPs as the actors who procurement processes are also public, however,
primarily defend democracy and the rule of law, they information on officials working in public procurement
face challenges such as securing funding and having processes is not public.
access to the regulatory framework (including the
In addition, Argentina provides for a system that allows
General Prosecutor) for open civic space that
for information to be requested from the government,
encourages the proper functioning of these
and any refusal to issue the information can be
organizations. LPs also emphasized the importance of
challenged before the Agency for Access to Public
giving CSOs a more active role and providing support to
Information, an independent body within the purview
investigative journalism that has reported corruption
of the Office of the Chief of the Ministerial Cabinet of
cases.
the Presidency of the Nation (Jefatura de Gabinete de
The Anti-Corruption Office recently created the Advisory Ministros de la Presidencia de la Nación).
Council for Monitoring the Implementation of the
Initiatives incorporated in the National Anti-Corruption
4Latin America Anticorruption Assessment 2020
H. RECOMMENDATIONS FOR THE LEGAL COMMUNITY
Strengthen the mechanisms of ethics in the public sector and the integrity of
government authorities, with detailed regulations aimed at deterring,
identifying and punish acts of corruption in the public sector
Propose and promote mechanisms for the appointment of judges in
Corruption in the public sector
accordance with international standards that guarantee political
independence of the judiciary, as well as ensure certainty of the judicial
career, including mechanisms for professionalization of public service and
discipline
Undertake efforts aimed at clearly delineating the duties of legal persons in
connection with anti-corruption prevention, establishing the applicable rules
and regulations, particularly with regard to situations involving cooperation Corruption in the private sector
with authorities and self-reporting (including by companies with regard to
crimes committed by individuals who work for them)
Undertake initiatives to promote mechanisms for strengthening institutions
and prevent political interference, including, if necessary, modifying the
appointment process
Institutional Strengthening
Promote institutional strengthening of anti-corruption agencies, including the
allocation of adequate financial and human resources, staff training, use of
technology and equipment
Encourage the creation of coordination mechanisms among anti-corruption
authorities, to prevent, identify, investigate, and sanction corruption more Institutional coordination
efficiently mechanisms
Promote formal mechanisms for civil society participation in the design and
implementation of anti-corruption public policy Participation of civil society
Establish mechanisms to disseminate information related to available
reporting mechanisms to the general population and public servants
Transparency
Promote legislation and regulations to establish beneficial ownership
registries in accordance with international standards and best practices
5II. BRAZIL
ü Policies and procedures for identifying and
Total Legislation Implementation Authorities managing conflicts of interest
ü Gift acceptance policies for high-level public
5.67 8.16 4.3 4.83
officials of the executive branch, prohibiting the
Brazil has a comprehensive anti-corruption policy receipt of gifts other than gifts less than R$ 100
framework, which includes anti-corruption policies and (approximately US$ 18)
practices for the public and private sector, protection of ü Policies on post-public employment obligations,
whistleblowers and cooperation mechanisms, among and restrictions of public officials to work in the
others.17 private sector after concluding their public service
ü Policies for training public officials in anti-
According to the participating LPs, the legal framework corruption measures
is generally sufficient, but there is room for
improvement, particularly in areas such as financing of In the area of sworn affidavits, the Brazilian legal
elections (including setting limits on the amounts of framework provides:
corporate donations) and financial secrecy, as well as ü Measures that require certain high-level public
protection by presidents of their political allies that has officials to render assets declarations
reportedly been widely used in recent years.
The assets declarations are not publicly available. These
Most LPs recognize the difficulty in implementing anti- are subject to evaluation by the Federal Court of
corruption laws in Brazil. One of the recurring Auditors. There is no obligation to file a statement of
comments is the lack of political will to effectively interest, although some federal officials are prohibited
implement the anti-corruption legal framework, and from participating in private companies. However, they
political influence on anti-corruption authorities. are permitted to be partners or have an interest,
provided they are not management or have
High-level politicians and public officials were identified
management functions.
as being more significantly experienced in anti-
corruption efforts vis-à-vis other members of the civil Law 12,813 2013 provides for a six -month waiting
service and the community at large. LPs agreed that period for some public officials before they can perform
there are considerable challenges in connection with certain functions. This provision was adopted to
aligning anti-corruption efforts in the different levels of prevent former public employees from using
government arising from Brazil being a federation. Less confidential information.
socially and economically favored sectors, including
Brazilian legislation only establishes general limitations
gender and racial minorities were identified as the
on members of the judiciary, such as non-participation
groups most affected by corruption.
in political activities.
A. PUBLIC SECTOR
B. PRIVATE SECTOR
Brazil has anti-corruption policies that include:
Brazil has an anti-corruption regulatory framework for
ü Codes of conduct for adequate performance of the the private sector and complies with the following
public service (for high-level federal officials) and checked items:
for the legislature
ü Codes of Conduct
6Latin America Anticorruption Assessment 2020
ü Rules for a “tone at the top” culture18 constitute prohibited conduct, as well as their related
ü Control and audit measures expense deduction. It is interesting to mention that in
ü Risk advice on regulatory compliance programs recent cases related to “Operation Car Wash” (Lava
ü Internal complaints procedures Jato), the tax administration agency has collected taxes
ü Training in compliance programs on the amounts of bribes as income. The contributing
ü Risk assessment and evaluation of compliance companies have filed a number of administrative
programs appeals with the Administrative Council on Tax Appeals,
ü Research protocols but they have been largely denied.
û Organizational chart and scope of work of In Brazil, private sector companies may be subject to
corporate officers, but there is an obligation for
administrative and civil liability, pursuant to the Clean
companies to have an independent internal body
Companies Act, but not to criminal
with human, material and financial resources to
responsibility. Companies may be fined 0.1% to 20% of
implement the activities of the compliance
their net profits in the fiscal prior year to the initiation
program
of an administrative proceeding20. As a method of
According to Law 12,846/2013, Clean Companies providing redress, the aforementioned law may require
Act19 and its Federal Decree 8,420/2015, these the company to disclose the decision imposing the
requirements are not binding on companies, but serve sanction through the media.
as criteria used by authorities to reduce
In civil matters, the Clean Companies Act provides that
sanctions. Companies that adopt a robust and effective
companies may be liable to third parties for damages
compliance program according to the parameters
resulting from an act of corruption, in addition to the
established by the Decree may have a decrease in fines
fact that companies may be suspended from their
from 1% to 4%.
activities, or prevented from receiving subsidies,
According to LPs, this legislation has been a watershed donations and other benefits from public agencies, for
for defining corporate responsibility (in acts involving one to five years. 21
the State, not among private companies) and for setting
Although the Criminal Code provides for penalties
parameters for the effectiveness of compliance
related to acts of corruption, in Brazil companies,
programs in companies.
as legal persons, are not subject to criminal liability,
The Brazilian legal system prohibits the following acts: which LPs report as an obstacle in achieving justice and
ü The use of false documents providing redress to victims of corruption-related
ü The intentional destruction of corporate books or crimes. LPs pointed out the problematic interpretation
documents may be a crime of obstruction of adopted by the Supreme Court that criminal
justice, if it is related to improper acts or sanctions cannot be enforced until a decision is final,
investigation by the authorities. increases the rates of impunity, as the court takes a long
time to issue its final decision. The Clean Companies
It does not prohibit the following:
Act encourages companies involved in corrupt practices
û Establishment of accounts not recorded in to reach settlements for the reduction of sanctions in
corporate books, carrying out unregistered exchange for valuable information. However, LPs report
transactions, the recording of nonexistent that, since the law establishes a "first in time, first in
expenses, the use of false documents, and the right" rule, other companies involved may not feel
intentional destruction of corporate books.
incentivized to cooperate and provide useful
Brazilian legislation does not distinguish between information for an investigation. Although cooperation
facilitation payments and bribes, so they both agreements somewhat remedy the multiplicity of
7Latin America Anticorruption Assessment 2020
authorities, enhance the efficacy of proceedings and ü Ministry of Justice and Public Security (Ministro da
contribute to more settlements, LPs reported that Justiça e Segurança Pública)
pursuant to this law, firms are required to deal with a ü Financial Activity Control Council (Financial
considerable number of agencies, making the Intelligence Unit) (Conselho de Controle de
settlement process more complicated. Atividades Financeiras é a Unidade de Inteligência
Financeira do Brasil)
Brazil’s criminal legislation provides for penalty ü Judiciary (Poder Judiciário do Brasil)
reductions for individuals who enter guilty plea ü
agreements in exchange for useful information.
According to LPs, the perception of some agencies and
C. REPORTING MECHANISMS AND PROTECTION FOR entities with the power to fight corruption in the
WHISTLEBLOWERS country is that they have been captured politically,
including the Federal Court of Auditors. Despite this,
According to LPs, the channels for filing complaints
LPs also recognize that, although they would benefit
within the government are readily accessible. However,
from strengthening their capacity, the Federal Public
other than the case of government-owned companies
Prosecutor's Office and the judiciary have managed to
(which are required to maintain internal platforms for
maintain a significant level of autonomy and
filing complaints), these channels are not regulated. In
successfully prosecute cases.
2011, a hotline was established to enable citizens to
report suspected acts of corruption in the public The Comptroller General has also been identified by the
administration. persons surveyed as an efficient authority in the fight
against corruption. The Constitution and the laws,
Pursuant to Law 13,964/2019, complainants may
however, provide the President of the Republic with the
receive compensation of up to 5% of the amount
power to appoint the heads of the anti-corruption
recovered as an incentive to report acts of corruption.
agencies, including the Attorney General, the Federal
This law also determines that whistleblowers have the
Court of Auditors, the Comptroller General, the
right to remain anonymous and to receive protection in
Financial Intelligence Unit and the Minister of Justice.
the event of retaliation or intimidation, including at the
workplace and on a personal level.22 All participants agree that Brazil is going through an era
characterized by lack of political will to effectively
There is no provision in Brazilian legislation on reporting
control corruption. A reflection of this phenomenon has
corruption to the press or media.
been the excessive time that it has taken authorities to
D. SPECIALIZED AUTHORITIES vote on the approval of anti-corruption laws and
decrees. The lack of judicial independence was also
The following agencies, with powers to prevent,
consistently reported by LPs, which conclude that:
investigate or punish corruption were identified at the
national level: Anti-corruption authorities generally have the
independence to prevent, investigate, and prosecute
ü Federal Public Prosecutor’s Office (Ministério
Público Federal) corruption cases, but certain agencies are subject to
ü Office of the Comptroller General (Controladoria- political influence.
Geral da União)
LPs rate the institutional capacity of public bodies
ü Federal Court of Auditors (Tribunal de Contas da
empowered to prevent, investigate, and prosecute
União)
acts of corruption as average.
ü Office of the Attorney General of the Republic
(Procuradoria Geral da República)
8Latin America Anticorruption Assessment 2020
LPs also highlighted that there is a perception of F. PARTICIPATION OF CIVIL SOCIETY
impunity given the lengthy processes it takes to resolve
Specific mechanisms regarding civil society
corruption-related cases.
participation in efforts to prevent corruption were not
E. INSTITUTIONAL COORDINATION MECHANISMS identified in the legal framework. Notwithstanding, civil
society organizations have been involved in and
There is a mechanism of cooperation and institutional
promoted anti-corruption initiatives, resulting in some
coordination to prevent, target, investigate and punish
success stories on accountability in Brazil 23
corruption, involving the Office of the Attorney General
of the Republic, the Federal Court of Auditors and the G. TRANSPARENCY AND ACCESS TO INFORMATION
Ministry of Justice and Public Security, under the
In Brazil, information regarding public officials and
coordination of the Supreme Court. In 2020, these
sanctioned private entities is available only to the
authorities implemented a technical cooperation
authorities. Public procurement processes are publicly
agreement that sets out a number of parameters with
available, but information on officials working in public
respect to guilty plea agreements and procedures for
procurement processes is not.
the reduction of sanctions. The Federal Public
Prosecutor's Office and the Office of the Comptroller In addition, Brazil provides for a system that allows for
General have entered into two cooperation agreements information to be requested from the government, and
in 2010 and 2014 with regard to information sharing any refusal to issue the information can be challenged
and combating corruption. before the corresponding higher authority of the
agency denying the request and, ultimately before the
LPs identified working groups composed by people
Comptroller General and the Committee on
from various institutions that address specific
Reevaluation of Information (which is not an
corruption-related matters, as a good practice.
autonomous body belonging to the executive branch).
9Latin America Anticorruption Assessment 2020
H. RECOMMENDATIONS TO THE LEGAL COMMUNITY
Assess and promote the legislative processes involving (i) limiting
presidential pardon; and (ii) the enforcement of corruption related
decisions prior to becoming final
Promote initiatives to create a system of public declarations of interest Corruption in the public sector
statements for public officials of the three branches of government and
other autonomous bodies
Promote legislation providing for criminal liability of companies engaged
in acts of corruption
Promote legislation to establish bans against companies for having Corruption in the private sector
accounts outside corporate books and books with unidentified
transactions
Promote regulations providing for whistleblower protection, as well as to
establish mechanisms that encourage the reporting of acts of corruption Reporting mechanisms
Promote legislation aimed at establishing beneficial ownership registries
in accordance with international standards and best practices Transparency
10III. CHILE
ü Statements of interest, including external activities
Total Legislation Implementation Authorities and participation in companies and organizations
7.86 8.21 8 7.5 It is important to mention that assets declarations are
mandatory for members of the judiciary in Chile.
According to LPs, Chile has a lean but effective
regulatory framework24 to prevent, investigate and With respect to post-employment obligations, Law
punish acts of corruption. The legal framework that 18.575 prohibits former public officials from working
governs corruption, although sufficient in general for a period of six months in enterprises that are subject
terms, would benefit from improvements aimed at to supervision.
strengthening the capacity of anti-corruption agencies The agency that oversees and coordinates the
and providing for greater incentives to report implementation of anti-corruption policies is
misconduct. According to LPs, there are gaps in the the Comptroller General and the Public Prosecutor's
regulation of corruption by individuals, and areas of Office.
opportunity for enhanced coordination among
agencies. B. PRIVATE SECTOR
Implementation of the anti-corruption regulations is Law 20.393 outlines a series of elements that
generally effective, and authorities have the capacity companies can adopt to self-regulate and prevent
and independence required for such implementation. punishable offenses or improper acts:
Participants identified people in poverty and in rural ü Codes of Conduct
areas as the most vulnerable to corruption. ü Organizational charts and scope of the work of
corporate officials
A. PUBLIC SECTOR ü Control and audit measures
Chile has anti-corruption policies that include: ü Risk advice on compliance programs
ü Internal complaints procedures
ü Standards or codes of conduct for proper ü Research protocols
performance of the public sector ü Training in compliance programs
ü Policies and procedures for identifying and ü Risk assessment and evaluation of compliance
managing conflicts of interest programs
ü Gift acceptance policies for public officials
ü Policies on post-public employment obligations, û The only element that this catalogue does not
and restrictions of public officials to work in the include are norms for a culture with the “tone
private sector after concluding their public service defined at the top”25
Specific policies for training public officials in anti- The existence of these elements is considered by Law
corruption measures were not identified. 20.393 as a mitigating liability factor in connection with
corruption-related misconduct.
Regarding sworn affidavits, the Chilean legal
framework provides that the following are public: The Chilean legal system prohibits the following acts:
ü Assets Declarations ü Establishment of accounts not recorded in
corporate books, carrying out unregistered
11Latin America Anticorruption Assessment 2020
transactions, the recording of nonexistent It is important to mention that these four institutions
expenses, the use of false documents, and the have constitutional autonomy to exercise their
intentional destruction of corporate books. functions. There are innovative methods in place for
ü Bribery or facilitation payments, as well as their selecting and appointing the heads of these agencies
related expense deduction. whereby the three branches of government, as
Legal persons in Chile are subject to civil, administrative opposed to just the executive, are involved in the
and criminal liability for certain offenses, including process.
bribery of national public officials, of foreign public Regarding specialized agencies, participants concluded
officials and of individuals. The corresponding penalties the following:
include fines, disqualification, loss of profits, and
Anti-corruption authorities generally have the
dissolution of a legal person. In addition, the
independence to prevent, investigate, and prosecute
publication of an extract of the conviction record may
corruption-related matters, but are not exempt from
be required at the expense of the company and the
political influence.
seizure of property related to the offense.
C. REPORTING MECHANISMS AND PROTECTION FOR LPs rank the institutional capacity of agencies
WHISTLEBLOWERS empowered to prevent, investigate, and prosecute
acts of corruption as medium-high .
Official channels are available to government officials
and citizens for reporting acts of corruption. The recurring view among LPs is that the Attorney
General's Office and the judiciary need to allocate more
However, there is no specific legislation or public policy financial and human resources to strengthen their
on mechanisms for the protection of whistleblowers, or institutional capacity and become more efficient.
economic incentives for reporting acts of corruption.
There is an incentive to report corruption-related LPs agree that Chile’s legal framework for transparency
offenses in criminal matters, as it is considered a is one of the most effective channels for preventing
mitigating liability factor. corruption, including the Transparency Council.
There is no provision in Chilean legislation E. INSTITUTIONAL COORDINATION MECHANISMS
on reporting corruption to the press or media. In Chile, coordination mechanisms exist between the
LPs agree that the existing mechanisms in the legal authorities responsible for the prevention, targeting,
framework are not sufficient to encourage the investigation and punishment of corruption. The Office
reporting of acts of corruption. of the Comptroller General and the Public Prosecutor's
Office have carried out cooperation arrangements
D. SPECIALIZED AUTHORITIES for the exchange of information.
Participants identified the following authorities with
F. PARTICIPATION OF CIVIL SOCIETY
powers to prevent, investigate or punish corruption:
There is no legislation or regulation providing means for
ü Office of the Comptroller General (Contraloría
civil society participation, including by academia and
General)
other non-governmental actors, in efforts to prevent
ü Office of the Attorney General (Ministerio Público)
corruption. However, the role of CSOs and the
ü Judiciary (Judicatura)
ü Transparency advice (Consejo para la media has been very significant in making public, and
Transparencia) pushing for action in, specific cases, including the
“Milicogate”, “MOP-gate” and “Caval” cases.
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