by Diogo Albaneze

On October 18, 2017, the Rio de Janeiro State Government published State Law No. 7,753/2017, which requires companies contracting with the State Public Administration (in contracts exceeding the threshold for the competitive bidding tender modality) to have an Integrity Program.

This Program, which is aligned with the precepts established by the Anti-Corruption Law (“Law 12,846/2013”), consists of the set of internal mechanisms and procedures for “integrity, auditing and encouraging the reporting of irregularities, and the effective application of codes of ethics and conduct, policies and guidelines with the aim of detecting and remedying misconduct, fraud, irregularities and unlawful acts committed against the public administration of the State of Rio de Janeiro” (art. 3 of State Law No. 7,753/2017).

The Integrity Program focuses primarily on anti-corruption measures, aiming above all to: i) protect the Public Administration from irregular acts that could lead to financial loss; ii) ensure that public-private contracts are performed in compliance with the law; and iii) achieve better performance in contractual relationships (article 2 of State Law No. 7,753/2017).

It must be implemented within the contracted legal entity within 180 (one hundred and eighty) calendar days from the date the contract is signed (art. 5 of State Law No. 7,753/2017).

To give effect to this anti-corruption policy, a company that fails to establish the Integrity Program as set out in State Law No. 7,753/2017 will be subject to a fine of 0.02% (two hundredths of a percent) per day on the contract value — up to a limit of 10% of the contract value (art. 6 of State Law No. 7,753/2017).