Administrator's Civil Liability On Corruption Acts Carried Out By The Company Without Their Awareness

Author:Mr Enzo Garcia
Profession:Gaia Silva Gaede Advogados

The creation of Law 12.846/2013, known as Anti-Corruption Law, was an undeniably important event in Brazilian history. Since its publication, great part of the companies, entrepreneurs and executives are trying to adapt to the new corporate reality introduced by said law, which aims at protecting national and foreign public administration, objectively attributing civil liability to legal entities.

Actually, the possibility of administrative fees of up to twenty per cent of the last fiscal year's gross income motivated big changes regarding corporate management.

Although there are legal and judicial paradigms in other countries, this subject is recent in Brazil and it naturally brings many doubts.

A common doubt is: to what extent will the administrators be liable for indemnifying society for losses arising from corruption acts carried out without their awareness?

The answer includes the analysis of article 1.011 of the Civil Code and article 153 of the Business Corporation Act, which provides for the diligence duty. This duty imposes to the administrator the use of efforts for good administrative practice, thus bringing conduct standards reasonably expected from the administrator in the charge of his functions. Then, some manifestations arise from this duty: the duty of inquiring, the duty of following, interfering, taking part, monitoring, looking for information and researching. Besides, since the publication and enforcement of the Anti-Corruption Law and the consolidation of the compliance practices in the market, the understanding of a new duty for the administrator is highlighted: the duty to have control to suppress the practice of conducts forbidden in the referred law.

Thus, especially for companies...

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