Guide to Whistleblowing

Contributing Editors

In this new age of accountability, organisations around the globe are having to navigate a patchwork of new laws designed to protect those who expose corporate misconduct. IEL’s Guide to Whistleblowing examines what constitutes a protective disclosure, the scope of regulations across 18 countries, and the steps businesses must take to ensure compliance with them.

Learn more about the response taken in specific countries or build your own report to compare approaches taken around the world.

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01. Which body of rules govern the status of whistleblowers?

01. Which body of rules govern the status of whistleblowers?

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Brazil

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Whistleblowing is addressed in Law 12846/2013 (Brazilian Anticorruption Act) and is also mentioned in Decree 8420/2015, which details the terms and conditions of the Brazilian Anticorruption Act.

Last updated on 29/07/2022

02. Which companies must implement a whistleblowing procedure?

02. Which companies must implement a whistleblowing procedure?

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Brazil

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Private companies are not legally required to have a whistleblowing procedure, but having one is an element that may benefit them in lessening the severity of sanctions imposed in anti-corruption investigations.

The only exception is financial institutions and companies subject to the authority of the Central Bank of Brazil. Such companies must set up a whistleblower channel due to administrative ordinance 4859/2020. Please refer to question 11 as regards financial institutions and other companies subject to the authority of the Central Bank of Brazil.

Last updated on 29/07/2022

03. Is it possible to set up a whistleblowing procedure at a Group level, covering all subsidiaries?

03. Is it possible to set up a whistleblowing procedure at a Group level, covering all subsidiaries?

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Brazil

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Yes, it is possible to set up a whistleblowing procedure at a Group level, covering all subsidiaries.

Last updated on 29/07/2022

04. Is there a specific sanction if whistleblowing procedures are absent within the Company?

04. Is there a specific sanction if whistleblowing procedures are absent within the Company?

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Brazil

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No, there is no specific legal sanction for not implementing a whistleblowing procedure.

Last updated on 29/07/2022

05. Are the employee representative bodies involved in the implementation of this system? 

05. Are the employee representative bodies involved in the implementation of this system? 

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Brazil

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No, employee representative bodies are not involved in the implementation of the whistleblowing procedure.

Last updated on 29/07/2022

06. What are the publicity measures of the whistleblowing procedure within the company?

06. What are the publicity measures of the whistleblowing procedure within the company?

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Brazil

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There is no reference in Brazilian law as to how the whistleblowing procedures must be implemented. However, it is good practice that the procedure be included in a Code of Integrity and Ethics that is widely accessible to employees and third parties, for example by including a link to the reporting channel on the company’s website, and that companies give regular training on internal regulations on the matter.

Last updated on 29/07/2022

07. Should employers manage the reporting channel itself or can it be outsourced?

07. Should employers manage the reporting channel itself or can it be outsourced?

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Brazil

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There is no statutory requirement in this regard. Accordingly, employers can manage the reporting channel directly or outsource it to an external supplier.

Last updated on 29/07/2022

09. What precautions should be taken when setting up a whistleblowing procedure?

09. What precautions should be taken when setting up a whistleblowing procedure?

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Brazil

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Brazilian law does not explicitly govern this matter, but it is good practice that the whistleblowing procedure must:

  • clearly indicate what type of conduct is subject to whistleblowing;
  • indicate who can make a report, how, when and where to do it – it is recommended to have at least two reportinng channels and it must be clear that reports can be made in a local language;
  • allow anonymous reports;
  • guarantee, to the extent possible, the confidentiality of the proceedings;
  • list the steps of the proceedings and the responsibilities and rights of each involved party (whistleblowers, witnesses, investigators, etc);
  • guarantee non-retaliation against whistleblowers or any person contributing to the investigation; and
  • indicate possible outcomes after the conclusion of the investigation.
Last updated on 29/07/2022

10. What types of breaches/violations are subject to whistleblowing?

10. What types of breaches/violations are subject to whistleblowing?

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Brazil

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In addition to violations of the company’s Code of Conduct, Compliance Policies, etc, companies should focus on the prevention of government corruption, such as the examples listed in the Brazilian Anticorruption Act (main examples below):

  • promise, offer or give, directly or indirectly, an undue advantage to a public agent, or a third party related to that agent;
  • finance, fund, sponsor or in any way subsidise the practice of illegal acts referred to in this Law;
  • use an intermediary, natural or legal person, to hide or disguise real interests or the identity of the beneficiaries of the acts performed; and
  • with regard to bids and contracts:
  • frustrate or defraud, through adjustment, combination or any other expedient, the competitive nature of a public bidding procedure;
  • prevent, disturb or defraud the performance of any public bidding procedure;
  • remove or seek to remove a bidder, through fraud or the offering of an advantage of any kind;
  • defraud a public bid or a contract resulting therefrom;
  • fraudulently or irregularly create a legal entity to participate in a public bid or enter into an administrative contract;
  • fraudulently obtain an undue advantage or benefit from modifications or extensions to contracts entered into with public bodies, without authorisation by law, in public bids or the respective contractual instruments; or
  • manipulate or defraud the economic-financial balance of contracts entered into with public bodies.

Also, conduct related to unfair competition, money laundering, harassment, and discrimination have been included as violations that can be reported in whistleblower channels.

Last updated on 29/07/2022

11. Are there special whistleblowing procedures applicable to specific economic sectors or professional areas?

11. Are there special whistleblowing procedures applicable to specific economic sectors or professional areas?

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Brazil

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Yes. As a result of the Brazilian Anti-Money Laundering law, the Central Bank has issued an administrative ordinance (4859/2020) that determines that financial institutions and other businesses subject to its authority have a whistleblower channel. Among other obligations, they must inform the Central Bank of operations that may indicate potential money laundering conduct. Non-compliance with such obligations will expose the companies and their officers to penalties such as warnings, fines, temporary bans from working as an officer of a company subject to the Central Bank’s authority or even closing of the business.

Last updated on 29/07/2022

13. Who can be a whistleblower?

13. Who can be a whistleblower?

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Brazil

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A whistleblower can be any person defined as such in the company’s Code of Ethics and Integrity, Whistleblower Procedure or equivalent document: employees, former employees, applicants, contractors, suppliers, clients or any persons that have information about inappropriate conduct.

Last updated on 29/07/2022

14. Are there requirements to fulfil to be considered as a whistleblower?

14. Are there requirements to fulfil to be considered as a whistleblower?

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Brazil

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There are no statutory requirements in Brazilian law. However, it is good practice that the whistleblower is a person acting in good faith and not seeking direct financial compensation.

Last updated on 29/07/2022

15. Are anonymous alerts admissible?

15. Are anonymous alerts admissible?

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Brazil

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Yes, anonymous alerts are admissible and a recommended practice in Brazil.

Last updated on 29/07/2022

16. Does the whistleblower have to be a direct witness of the violation that they are whistleblowing on?

16. Does the whistleblower have to be a direct witness of the violation that they are whistleblowing on?

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Brazil

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There is no legal requirement that the whistleblower must be a direct witness of the violation.

Last updated on 29/07/2022

17. What are the terms and conditions of the whistleblowing procedure?

17. What are the terms and conditions of the whistleblowing procedure?

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Brazil

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There are no legally required terms and conditions of the whistleblowing procedure. However, it is good practice that the procedure must be made promptly, independently, impartially, discreetly, and confidentially. Whistleblower channels must be easily accessible to employees and third parties, there should be mechanisms to protect good-faith whistleblowers, measures that guarantee the immediate suspension of irregular conduct and remediation of damages and disciplinary measures if there is a violation of the process.

Last updated on 29/07/2022

18. Is there a hierarchy between the different reporting channels?

18. Is there a hierarchy between the different reporting channels?

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Brazil

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Brazilian law does not govern this. However, from a practical perspective, there should be no hierarchy between the different reporting channels since all channels made available to whistleblowers should be equally reliable.

Last updated on 29/07/2022

19. Should the employer inform external authorities about the whistleblowing? If so, in what circumstances?

19. Should the employer inform external authorities about the whistleblowing? If so, in what circumstances?

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Brazil

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No, there is no obligation for the employer to inform external authorities about the reports.

Last updated on 29/07/2022

20. Can the whistleblower be sanctioned if the facts, once verified, are not confirmed or are not constitutive of an infringement?

20. Can the whistleblower be sanctioned if the facts, once verified, are not confirmed or are not constitutive of an infringement?

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Brazil

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The whistleblower must report facts in good faith, and unconfirmed reports made in good faith are not an infringement.

However, bad-faith reports can lead to the termination of the employment agreement. Also, it can trigger personal criminal liability for the whistleblower.

Last updated on 29/07/2022

21. What are the sanctions if there is obstruction of the whistleblower?

21. What are the sanctions if there is obstruction of the whistleblower?

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Brazil

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There are no specific sanctions if there is obstruction of the whistleblower.

Last updated on 29/07/2022

22. What procedure must the whistleblower follow to receive protection?

22. What procedure must the whistleblower follow to receive protection?

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Brazil

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The procedure for the whistleblower to receive protection is whatever is outlined in the company’s whistleblowing proceeding.

Last updated on 29/07/2022

23. What is the scope of the protection? 

23. What is the scope of the protection? 

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Brazil

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The scope of the protection will be determined by the Code of Integrity and Ethics, whistleblower proceedings or the relevant rule. Usually, the whistleblower’s identity is kept confidential, and he or she is expressly protected against retaliation for presenting an accusation.

Last updated on 29/07/2022

24. What are the support measures attached to the status of whistleblower?

24. What are the support measures attached to the status of whistleblower?

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Brazil

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There are no statutory support measures attached to the status of whistleblower.

Last updated on 29/07/2022

25. What are the risks for the whistleblower if there is abusive reporting or non-compliance with the procedure?

25. What are the risks for the whistleblower if there is abusive reporting or non-compliance with the procedure?

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Brazil

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Abusive reporting, understood as bad-faith reporting, can trigger criminal liability for the whistleblower. The characterisation of the criminal offence will depend on what was reported as there are several offences that may derive from an intentionally false accusation.

If the whistleblower is an employee, he or she may be subject to disciplinary measures, including the termination of employment for cause.

Last updated on 29/07/2022