anti corruption manual

Anti-corruption_Manual.indd 1 10/13/16 2:45 PM

1 Introduction ................................................................................................................... 04

2 Objective .......................................................................................................................... 06

3 Why we need an anti-corruption manual when we already have the code of ethics and conduct? .......................................................... 07

4 Concepts and Clarifi cations ............................................................................... 08

5 Other important defi nitions .............................................................................. 12

6 Anti-corruption procedures adopted by Atlantic .............................. 15

7 What we can and should do? ............................................................................. 16

8 What we cannot do? ................................................................................................ 18

9 Penalties for corruption related cases? ..................................................... 19

10 Reports and Complaints ....................................................................................... 20

11 Term ..................................................................................................................................... 20

12 Commitment Agreement ..................................................................................... 21


This manual is part of the Atlantic Code of Ethics and Conduct and was prepared based on the Brazilian legislation on anti-corruption currently in force, Law 12.846 /2013 (Anti-Corruption Law), which have basic characteristics similar to foreign law, as the Foreign Corrupt Practices Act (FCPA) and the Bribery Act (UK).

This manual was developed to help everyone understand anti-corruption policies that should be adopted by companies, especially after the enactment of the Anti-Corruption Law, which make them objectively liable for acts of corruption against public administration. Regardless of guilt or knowledge, if such practices are applied, companies will be subject to the sanctions of the Anti-corruption Law.

Besides sanctions, corruption may negatively affect the image of the company and our businesses. The manual aims to demonstrate the consequences of inappropriate behavior and what should be done in order to have an adequate conduct to support the fight against corruption according to the Compliance Program point of view.

Introduction

04


05


06

In order to strengthen its Code of Conduct concepts and reaffirm the commitment to good market practices, Atlantic intends to establish the guidelines that must be followed in compliance with the Anti-Corruption Laws.

The guidelines aim to raise awareness about the practices that should be avoided in the corporative environment, society and direct or indirect relationships with public and private entities (national or international). Any violation of the Anti-Corruption Laws may result in civil and criminal sanctions, including payment of fines and imprisonment that may be applied to the company as well as all others involved. Those sanctions may be imposed by Brazilian and foreign government entities regardless of the country where the violation was originated.

Therefore, the main objective of this manual is to prevent, detect and correct any act of corruption that may jeopardize the institutional integrity of Atlantic, applying to its officers, employees, suppliers, customers and its subsidiaries, both in Brazil and abroad.

Objective


07

the practice of corruption or harmful acts against national or foreign public administration in order to avoid them, also detailing the anti-corruption procedures implemented by Atlantic, based on its premises of Mission, Vision and Values.

It is also very important to highlight that this additional manual does not replace the necessary knowledge of the Anticorruption Law, the Code of Ethics and Conduct and other company policies.

Why we need an Anti-corruption manual

when we already have the code

of ethics and conduct


08

What is Compliance?

Compliance concerns the strict observance of the rules and laws, in line with the principles whether inside or outside the companies, including ethics, morality, honesty and transparency, not only in conducting business but in all attitudes.

Compliance is a good governance tool, as well as a cultural change in the way of acting and negotiating of Brazilian companies. The Compliance system protects the company and its leaders against the practice of crimes, has great importance on the value of corporate reputation, minimizing institutional risk and making the company ethical and professional.

What is corruption?

Concept and Clarifications

One of the main focuses of Compliance is the fight against corruption, therefore, it is necessary to understand the concept because of the diversity of meanings. According to the dictionary it is “the lack of integrity or honesty (especially susceptibility to bribery); use of a position of trust for dishonest gain; moral perversion; impairment of virtue and moral principles; destroying someone’s (or some group’s) honesty or loyalty; undermining moral integrity; inducement (as of a public official) by improper means (as bribery) to violate duty; decay of matter (as by rot or oxidation)”.

Corruption may be any action that seeks to gain advantages for one´s own interest, in other words, it is the abuse of entrusted power for private gain.


09

According to the Brazilian Criminal Code, corruption can be classified as active and passive, as follows:

• Active corruption: The act of offering advantage (in various ways) or any kind of benefit to the server in order to affect the moralityof public administration, to induce him to perform, omit or delay the competent action of his function.

• Passive corruption: The soliciting or receiving of an undue advantage of any kind by a person in order to perform an action in the course of his or her business.

The concept of corruption is broad and includes practices that have the purpose of obtaining advantages, highlighting embezzlement, bribery, fraud, extortion, nepotism, money laundering among others. The best known form of corruption in the corporate environment is the payment of bribes, but it may also take place in the form of gifts, entertainment, travel expenses and so on.

Thus, this Manual addresses specifically corruption or harmful acts involving public agencies, in line with the Anti-Corruption Law, but the concept applies to corruption involving any entity, whether public or private.

What are the harmful acts?

In addition to the acts of corruption, the Anti-Corruption Law covers other aspects known as harmful acts against national or foreign government. Harmful acts are considered all those carried out by legal entities (commercial companies and simple companies, personified or not, regardless of the form of organization or corporate model adopted, as well as foundations, associations of entities or persons or foreign companies which have their registered office, branch or representation in Brazil) that go against the national or foreign public property, against principles of public administration or against the international commitments assumed by Brazil, defined as follows:


10

• Promising, offering or giving, directly or indirectly, undue advantage to a public officer or third person related to him;

• Financing, sponsoring or otherwise subsidizing the practice of illegal acts specified in the Anti-Corruption Law;

• Using the interference of an individual or entity to conceal or disguise the real interests or the identity of the beneficiaries of performed acts.

• About bids and contracts:

Frustrating or defrauding by adjustment, combination or any other expedient, the competitive nature of the public bidding process;

Preventing, hindering or defrauding the performance of any act of public bidding process;

Withdrawing or attempting to withdraw a bidder, through fraud or any offer of advantage;

Defrauding public tender or contract resulting from it;

Creating, fraudulently or irregularly, a legal entity to participate in public tender and to sign a government contract;

Obtaining advantage or undue benefit, fraudulently, from modifications or extensions of contracts signed with the government, without authorization by law, during the act of the public tender or in the respective contractual instruments;

Manipulating or defrauding the economic-financial balance of contracts signed with the government;

• Hindering investigations or supervisory activities of public agencies, entities or employees, or intervening in their operation


11


12

Presentation of other terms used in the Anti-Corruption Law that we need to know:

• Bribery: Offering, giving and/or receiving something of value in exchange for favorable treatment by a company official authority or official.

• Misappropriation/ Embezzlement: In criminal law, it is referred as the intentional, illegal use of the property or funds of another person for one’s own use or other unauthorized purpose, particularly by a public official, a trustee of a trust, an executor or administrator or by any person with a responsibility to care for and protect another’s assets.

• Facilitation Payment: A financial payment that may constitute a bribe and that is made with the intention of expediting an administrative process. A facilitation payment is a payment made to a public or government official that acts as an incentive for the official to complete some action or process expeditiously, to the benefit of the party making the payment. Examples of requested services include telephony service, visas, water and energy supply, etc.

• Money laundering: Any act or attempted act to conceal or disguise the identity of illegally obtained proceeds so that they appear to have originated from legitimate sources.

• Unfair advantage or undue payment: Cash payments and any transfer of value to influence or reward an official act or decision of a public officer.

• Item of value: Money (in cash, check, stock etc), gifts, travel, entertainment, job offers, meals, discounts when purchasing products, travel expenses reimbursement. Items of value may also include event sponsorships, scholarships, research support and charitable donations requested either for the benefit of government officials or their families, even if they are for the benefit of a legitimate charity.

Other Important Definitions


13

• Public official or Government official: The definition of “public official” or “government official” applies to all officers and employees of public companies or those controlled by the government. Public officials include civil servants, judges and individuals who otherwise carry out official public functions, or have otherwise been appointed to serve with a public authority or agency, or have been commissioned to perform public administration services. As this term is interpreted broadly by the anti-corruption authorities, we list below some categories of individuals regarded as “public officials” for the purposes of anti-corruption laws:

Directors and employees of any government agency at national, state, regional or local levels, including elected officials;

Any individual temporarily acting in an official way for or on behalf of any governmental entity (such as, a consultant hired by a government agency);

Directors and employees of companies with government participation;

Political candidates at any level, political parties and their representatives;

Directors, employees or officials of any public international organization such as the World Bank, the United Nations and the International Monetary Fund;

The definition also covers the members of an official’s family including the following relatives, regardless of where they reside: spouse, children (whether dependent or not), siblings, parents, grandparents and grandchildren. It also includes any other person related by blood or by marriage and living in the same household.

• Governmental entities: A government entity refers to commercial enterprises, institutions, agencies and departments controlled by the government or other public entities (regardless of total or partial ownership or control), including research institutions, universities and hospitals.


14


15

• Atlantic and all its subsidiaries, regardless of place of operation, are responsible for maintaining a system of internal controls and records that must reflect accurately all relevant accounting operations;

• The company broadly disseminates its code of conduct and all its policies for knowledge and acceptance of employees and managers;

• A careful analysis is performed for hiring service providers, suppliers and even customers, ensuring that they also entirely comply with the company’s ethical standards and Anti-corruption Laws;

• Atlantic includes anti-corruption clauses in its contracts with customers, suppliers and service providers in order to extend to its partners the obligation to comply with anti-corruption laws and internal rules of the Company;

• Trainings are carried out for an effective integration with the regulations of the Anti-Corruption Law;

• Atlantic offers a reporting channel, ensuring the confidentiality of information, to detect any corrupt practices that may happen in the company.

Anti-corruption procedures adopted

by Atlantic

Atlantic aims to prevent any act of corruption and advises all employees to follow the principles

of the company with honesty and integrity


16

• It is the duty of all officers and employees of the company and its subsidiaries in all operating units and countries to perform their functions according to the Anti-Corruption Laws and to conduct all business with integrity, avoiding any form of fraud, bribery, corruption, forgery, dishonesty or money laundering.

• IEmployees must protect the image of the company and maintain honesty, loyalty and integrity with the company, colleagues and business partners.

• IRelationships with business partners and especially with public officials must be guided by ethics, transparency and formality.

• IIn case of bribery attempt, any person with direct or indirect connection to Atlantic, shareholders, employees or service providers, must not open negotiations, consent or create expectations on the other party and must contact the immediate supervisor.

• IEmployees and directors must not take precedence from their position in the company. They must not receive, allow others to receive or grant advantages to third parties that go beyond the usual trade policies.

• IUse the reporting channel tool to inform unethical practices and corruption.

• Consult your manager or supervisor before committing any dubious act.

• Consult the Atlantic Code of Conduct.

What we can and should do


17

• The adoption of actions that are considered violations of the Anti-Corruption Law by intermediaries, service providers, contractors, distributors, suppliers or partners, whether individuals or legal entities related to Atlantic and its subsidiaries due to contract and / or commercial relation is under responsibility of the Atlantic Group, therefore, managers should be responsible for knowing the reputation of the regulator and formally provide guidance on the practices that are adopted and encouraged by the company to fully meet the Anti-corruption Law (clauses, terms).

• Corruption risk assessment: the following examples of situations are considered red flags for potential violations of the Anti-Corruption Law by business partners:

The other part is known for violation of local laws;

Refusal to sign anti-corruption clauses in contracts or agreements;

Request for unusual agreements or payments that contradict local laws;

Contracting of another part suggested by a government official;

The name is included in the National Register of suspended and disreputable companies (www.portaItransparencia.gov.br/ceis).

Any doubt or questions about situations that might violate the Anti-Corruption Law must be previously clarified with the Legal Department.


18

• It is prohibited under any circumstances to offer, authorize, pay any item of value (p. 12) or make promises to any person related to negotiations, directly or indirectly to a public official or a third party related to him, candidates, political party or affiliate of any nationality to influence or induce to obtain or retain business and other improper advantage.

Employees of business entities controlled by governments are also included in the public organization category.

• Offering and receiving bribes that may be presented in the form of cash, gifts, entertainment, meals, travel, events, employment, donations and so on;

• Practicing Payment Facilitation (amounts of money or property paid to a public official to secure or expedite routine activities);

• Finance, fund, sponsor or otherwise subsidize the practice of illegal acts provided by law;

• Use of interposed person or entity to conceal or disguise the real interest or the identity of the beneficiaries of the performed acts;

• Harmful acts related to bids and contracts;

• Hindering investigations or supervisory activities of public agencies, entities and employees or intervening in their operation.

What we cannot do?


19

Penalties for corruption related cases

For direct or indirect employees:

• Employees will have their employment contract terminated and depending on the gravity of the act, be legally held to account;

• Service companies will have their contract terminated and be legally held to account if the act is related to Atlantic.

For the company:

• The law provides for a fine, equivalent to 0.1% (one tenth percent) to 20% (twenty percent) of the gross revenues of the last year prior to the initiation of administrative proceedings, taxes excluded, which will never be less than the advantage obtained, when the estimation is possible;

• When the use of gross revenue criteria is impossible, the fine will be defined from R$ 6,000.00 (six thousand reais) to R$ 60,000,000.00 (sixty million reais);

• Disclosure of the decision on communication channels.


20

Any employee should be aware that Atlantic has a channel to report unethical behavior, in a broad sense. In addition, the channel is also available to the employee for reports of any suspicious act or practice that violates the guidelines in this manual.

Complaints can be identified or anonymous and in this case confidentiality will be guaranteed.

Reports and Complaints

This manual has been reviewed and approved by the Board of Directors and put into effect. All other rules and regulations established by the company remain in force.

Term


21

I hereby declare that I have received, read and understood the Atlantic Anti-Corruption Manual and I fully agree to comply with the rules and guidelines contained therein.

Name:

Position:

Department:

Place:

Date:

Signature:

Commitment Agreement


anti corruption manual

Investor Relations