Dutch engineering company SBM Offshore announced this week it has reached a leniency agreement with Brazilian authorities to resolve allegations relating to the Petrobras bribery scandal.
Specifically, the settlement agreement, reached on July 15, resolves an investigation launched last year by the Federal Government General Controller, or in Portuguese, Controladoria-Geral da União (CGU), into allegations that SBM Offshore engaged in a “pay-to-play scheme” in which company representatives bribed executives of state-owned oil company Petrobras from 1996 to 2012 in exchange for contracts.
Under the agreement, SBM Offshore will pay US$162.8 million, of which US$149.2 million will go to Petrobras, US$6.8 million to the Public Prosecutor’s Office, or Ministério Público Federal (MPF), and US$6.8 million will go to the Council of Control of Financial Activities, or Conselho de Controle de Atividades Financeiras (COAF) to be used to prevent and combat future corruption, according to the leniency agreement.
The Ministry of Transparency, Oversight and Control (Ministério da Transparência, Fiscalização e Controle – “MTFC”) investigation had been suspended as a result of the execution of a memorandum of understanding (MoU) between the MTFC and SBM Offshore in March 2015. Under the terms of the settlement agreement, SBM Offshore said it has been granted by the MTFC, the MPF, the AGU and Petrobras, “full discharge and exemption from legal actions” for all related matters.
In total, Petrobras will receive $328.2 million in compensation from SBM. In addition to the US$149.2 million, Petrobras also will get US$179 million, which “represents the nominal value to be deducted from future payments owed by Petrobras to SBM based on prevailing contracts,” Petrobras said in a statement.
“The settlement agreement provides for Petrobras and SBM Offshore to resume normal business relationships,” according to the leniency agreement.
SBM Offshore further held a conference call on July 18, hosted by CEO Bruno Chabas, CFO Peter van Rossum, and Chief Governance and Compliance Officer Erik Lagendijk. That webcast may be accessed here.