On Wednesday, February 21, Transparency International published its annual Corruption Perception Index (CPI), a ranking report which evaluates the perception of corruption worldwide. The index classifies 180 countries and territories, taking into account the perceived levels of corruption in the public sector according to experts and business executives. The countries receive scores ranging from 0 to 100, such that the closer to 0 a country scores, the greater the perception of corruption in that country.
According to the CPI, New Zealand and Denmark are the countries that obtained the highest scores, with 89 and 88, respectively. The best performing region is Western Europe with an average score of 66, while the worst performing areas are Sub-Saharan Africa with an average score of 32, as well as Eastern Europe and Central Asia, with an average score of 34.
Brazil is listed in the 96th position in the ranking with a score of 37, its worst result in the last five years, falling 17 positions compared to the 2016 index. With this decrease, Brazil, which was once in the same position as India and China, is now behind countries like Sri Lanka and East Timor, and is tied with Colombia, Indonesia, Panama, Peru, Thailand and Zambia. In the 2016 CPI, Brazil had occupied 79th place, with a score of 40. Compared with the last ranking, only Liberia and Bahrain showed a greater retreat than Brazil.
Whilst efforts to tackle corruption in Brazil have increased, these same efforts also end up raising the perception of the existence of corruption in the country. Consequently, the adoption of measures to prevent corruption, including the implementation of compliance programs and monitoring of possible irregularities in legal entities or related third parties, as well as conducting due diligence prior to investments made in the country, are even more important in the context of conducting business.
For more information regarding this legal update, please contact the Anti-corruption & Compliance team at: CompliancePartnersTC@mayerbrown.com.
Observations in this update about Brazilian law are by Tauil & Chequer Advogados. They are not intended to provide legal advice to any entity; any entity considering the possibility of a transaction must seek advice tailored to its particular circumstances.