As the Petrobras corruption scandal moves from its initial investigative phase (focusing on the corrupt actions of Petrobras employees), to the investigation of the international companies that did business with the Brazilian national energy company, Europeans that did business with the energy giant now face some challenging decisions around the issue of self disclosure.
The Brazilian lead prosecutor, Deltan Marinazzo Dallagnol, has made clear that companies which do not self-disclose to Brazilian authorities will not be looked upon as favorably as those who come forward. Marinazzo said in a statement, “We will focus on international companies in a second step, and the sooner they come to cooperate, the better for them.”
Marinazzo’s statement indicates the international entities that did business with Petrobras are in the investigators’ sights. While one Dutch company, SBM Offshore, reportedly has self-disclosed and is in talks about the amount of its penalty; the Financial Times has reported that at least four other international companies have been implicated in the Petrobras scandal. They are the English company Rolls-Royce, the Danish shipping company Maersk, and two Singaporean companies, Keppel Corp. and Sembcorp Marine. Rolls-Royce has admitted an internal investigation for the charges, but the other three companies, at least in public, have denied participating in bribery schemes involving Petrobras.
The decision to self-disclose is one of the most difficult a company can make. Brazilian prosecutors, however, have made clear that if a company wants leniency going forward, said company must come in sooner rather than later. Dallagnol even stated, “We will not make agreements with all of them; we are going to make agreements with the ones that arrive sooner.”
For businesses in Europe, the idea of self-reporting illegal conduct to a government authority is not as familiar as to U.S. companies subject to the Foreign Corrupt Practices Act. Brazilian prosecutors have telegraphed that cooperating witnesses who worked for Petrobras are naming companies that paid bribes to them, and detailing how the payments were made through third parties to Swiss banks.
Further, the Brazilian prosecutors have the model in place they used from their prior investigation into the German company Siemens and its corruption involving the São Paulo subway scandal. In that case, once one company had self-disclosed, the Brazilian prosecutors were able to use information developed through that source to prosecute other companies aggressively. The time for companies to forward it narrowing, and some difficult decisions will need to be made.