SBM Offshore Pens Leniency Deal with Brazilian Authorities
- Business & Finance
Dutch marine energy group SBM Offshore has signed a leniency agreement with the Brazilian authorities and oil and gas major Petrobras paving way for the closure of the legal issues in the country.
Under Brazilian anti-corruption law, leniency agreements are offered to entities which have practiced illicit acts but ceased to do so and have effectively cooperated with the investigations and the administrative proceedings.
The deal follows previous resolutions reached by the company with the Dutch Public Prosecutor in November 2014, and the United States Department of Justice (DoJ) in November 2017, to resolve criminal charges involving bribes in five countries.
As disclosed earlier by DoJ, beginning by at least 1996 and continuing until at least 2012, SBM conspired to violate the Foreign Corrupt Practices Act (FCPA) by paying more than USD 180 million in commissions to intermediaries, knowing that a portion of those would be used to bribe foreign officials in Brazil, Angola, Equatorial Guinea, Kazakhstan and Iraq.
SBM paid a combined worldwide total in criminal penalties in excess of USD 475 million.
Under the latest deal, the company agreed to pay approximately USD 148 million to Petrobras, of which USD 71 million is a civil fine and USD 77 million is compensation for alleged damages. The total amount is to be paid within 90 days.
The agreement also stipulates a 95 percent reduction in future performance bonus payments related to FPSOs Cidade de Anchieta and Capixaba lease and operate contracts, representing an agreed nominal value of approximately USD 180 million over the period 2016 to 2030.
In return, Brazilian Ministry of Transparency (CGU), Comptroller’s General Office (AGU) and Petrobras will terminate all of their investigations against the company and refrain from initiating new legal proceedings in relation to the legacy issues in Brazil.
SBM Offshore will periodically report to CGU on its compliance program for three years.
As such, SBM Offshore has been allowed to participate in Petrobras’ tenders under equal conditions as other bidders.
“The Leniency Agreement with CGU, AGU and Petrobras marks a key milestone towards a closure of the Company’s legacy issues in Brazil. This agreement supports the continuation of our long-lasting relationship with Petrobras and will allow SBM Offshore to successfully pursue new business opportunities in Brazil,” Bruno Chabas, CEO of SBM Offshore, commented.
SBM Offshore said that it continues to co-operate with investigations conducted by CGU and AGU into third parties in relation to the case.