The Federal Government issued, on December 9, 2021, Decree No 10,889 (“Decree”) that: (i) increases transparency in the disclosure of the agenda of public appointments of officials of the Executive Federal branch; and (ii) changes the rules for the receipt of gifts and hospitality by public officials.
The Decree regulates section VI of Article 5 and Article 11 of Law No. 12,813/2013 (Conflict of Interests Act).
Register of interactions with representatives of private interests or associations
According to the Decree, the “e-Agendas”, which is an electronic system managed by the Office of the Comptroller General (“CGU”), will be implemented and launched by October 2022.
The e-Agendas system will only be mandatory for the bodies and entities of the direct federal administrative branch, autonomous federal agencies and government foundations. For state-owned and state-controlled companies, the use of e-Agendas will be discretionary, whereby the employment of other systems to register the information will be allowed.
According to the Decree, every time a public official meets a representative of private interests or associations, the public official must record in e-Agendas or in the specific system the: (i) meeting subject; (ii) location; (iii) date; (iv) time; and (v) list of attendees.
New rules for the receipt of gifts and hospitality
The Decree forbids public officials of the Executive Federal branch from receiving gifts from private agents with interests in a decision made by the public official or by a committee in which the public official takes part.
Definition of gifts: Gifts are considered to be assets, services or advantages of any kind received from those with interests in a decision made by the public official or by a committee of which the public official takes part, and that are not constituted as promotional gifts or hospitality.
Definition of promotional gifts: Item of low economic value and distributed generally, as a courtesy, advertisement or routine promotion, provided that the addition requirements are fulfilled.
Definition of hospitality: Offer of services or expenses for transportation, meals, accommodation, courses, seminars, congresses, events, fairs or entertainment activities, granted by private agents to public officials in the context of the institutional interest of the body or entity of which the public official takes part, provided that certain additional requirements are fulfilled.
The Decree establishes a limit on the amount allowed for gifts of up to 1% of the highest remuneration of the Brazilian public service, which is the salary of the justices of the Brazilian Supreme Court that currently amounts to BRL 39,293.32 – resulting in the current limit of BRL 392.93 for gifts.
As for the receipt of hospitality by public officials, such practice is allowed provided that: (i) it is authorized by the body or entity of which the public officials takes part; (ii) it is related to the purpose of the representation of interests; (iii) the value is consistent with the standards adopted by the public administration in similar services or with other hospitalities offered in similar conditions; and (iv) it does not constitute a personal benefit.
The receipt of hospitality and/or gifts by public officials must be recorded in the e-Agendas or in the specific system, containing the following information: (i) date; (ii) asset, service or advantage of any kind received; and (iii) identification of the soliciting private agent. For the receipt of promotional gifts, the referred recording procedure was exempted.
The records at e-Agendas, both for appointments as well as for gifts and hospitality received, will be mandatory as of October 9, 2022, the same date as this specific section of the Decree enters into force. The remaining provisions of the Decree enter into force on February 9, 2022.
Demarest’s Compliance and Investigations team is available to provide further information or clarification on this and other related topics.