Procurement Risk:
Moderate
Score:
53/100
Government Policy
Q57
63/100
Does the country have legislation covering defence and security procurement with clauses specific to corruption risks, and are any items exempt from these laws?
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This indicator is not assigned a score in the GDI. As previous assessments showed, most of the defence acquisitions occur under the same acquisitions…
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Legislation might not explicitly mention the need to assess corruption risks, but the whole bureaucratic acquisition process in Brazil has this aim [1]. For…
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All public procurements must be legally and publicly registered – even those which are exempt from public bidding [1]. The Submarine Development Program (PROSUB)…
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Q58
75/100
Is the defence procurement cycle process, from assessment of needs, through contract implementation and sign-off, all the way to asset disposal, disclosed to the public?
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Law 8.666/93 formalises the entire procurement process with very strict phases. As the previous assessments pointed out, most of the defence acquisitions occur under…
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The defence procurement cycle process is fully disclosed through the Public Biddings Law and many available documents that explain the cycle’s legislation, including assessment…
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Even with partially incomplete databases, the data available in the Brazilian Transparency Portal gives us some evidence of compliance with acquisition norms and phases…
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Q59
42/100
Are defence procurement oversight mechanisms in place and are these oversight mechanisms active and transparent?
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There is the oversight mechanism of the Court of Auditors (TCU), but it only regularly provides oversight for the execution of the annual budget.…
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The mechanisms described in question 59A seem to work fine, and some restructuring of the single forces internal controls occurred between 2010 and 2013.…
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The TCU is regularly in the media due to its investigations of frauds in public acquisitions [1, 2, 3, 4]. These investigations are very…
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Brazil has a general plan of what will be developed (which involves acquisitions) in its three strategic defence documents: the Defence National Strategy (END…
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The PAED is not available, as it is still being worked on [1], therefore it is not possible to know the plans regarding defence…
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As the previous assessments showed, most of the defence acquisitions occur under the same acquisitions law, Law 8.666/1993 [1]. Article 24 of Law 8.666/93…
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All government acquisitions are registered and displayed on government websites, whether on Transparency Portal (the federal government’s acquisition portal, Comprasnet, used to be available…
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Capability Gap and Requirements Definition
Q62
50/100
What procedures and standards are companies required to have – such as compliance programmes and business conduct programmes – in order to be able to bid for work for the Ministry of Defence or armed forces?
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There have been no legal changes between 2015 and 2020 on this topic. The Public Procurement Law 8.666/93 [1] establishes, respect to administrative probity,…
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All companies comply with Law 8.666’s requirements to sell products or services to the government [1]. Exemptions are justified, and the name of the…
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Q63
42/100
Are procurement requirements derived from a national defence and security strategy, and are procurement decisions well-audited? Are defence purchases based on clearly identified and quantified requirements?
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The National Defence Strategy establishes several general criteria for acquisitions in defence, related to the main strategic needs of each single force [1]. However,…
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The Federal Court of Auditors (TCU) often audits purchases and programs of the Brazilian Armed Forces evaluating if they are aligned with national defence…
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The assessor found no evidence of important purchases made regardless of the National Defence Strategy, defining in the public bidding calling for exact quantities…
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Tender Solicitation, Assessment and Contract Award
Q64
25/100
Is defence procurement generally conducted as open competition or is there a significant element of single-sourcing (that is, without competition)?
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According to Brazil’s Transparency Platform, in 2019, 43% of defence procurements were conducted as open competitions (in the bidding modes pregão and concorrência) [1].…
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As previously mentioned, the Court of Auditors (TCU) can audit these contracts, but its evaluation is not systematic or randomized – it is generally…
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Q65
44/100
Are tender boards subject to regulations and codes of conduct and are their decisions subject to independent audit to ensure due process and fairness?
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The rules for forming a tender board for acquisitions are determined in Article 51 of the Procurement Law 8.666/93 [1]. The rules stipulate a…
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The Court of Auditors (TCU) is responsible for overseeing these commissions, on its website, there is evidence that it does oversee and question legal…
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Tender boards are regulated by the Public Procurement Law. Their composition is public, and some of their duties, they shall evaluate and answer impugnation…
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There is some scrutiny made by internal control agencies and the TCU, but it is not done regularly, nor focused on defence matters [1,…
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Q66
75/100
Does the country have legislation in place to discourage and punish collusion between bidders for defence and security contracts?
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The Anti-corruption Law (Lei Nº 12.846) [1] applies to the defence sector and establishes in Article 5 that collusion of any type (whether between…
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The Anti-corruption Law, in Article 6, establishes criteria regarding fines to companies that have frauded or colluded in public biddings. Together with these criteria,…
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The Anti-Corruption Law in Brazil has already positively impacted corruption investigations, especially in the Car Wash Investigation [1]. However, the assessor could not find…
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Training is not advertised on their websites. All the training available is limited to the already known bureaucratic process of the Procurement Law and…
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Contract Delivery and In-Service Support
Q67
69/100
Are there mechanisms and procedures that ensure that contractors meet their obligations on reporting and delivery?
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The assessor found guidelines made by all the different branches of the military; there is no standard procedure among the three forces and the…
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The Court of Auditors (TCU) receives detailed information, which is not always easily accessible by citizens. There is some information about contract execution and…
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Contract administrators have to follow internal guidance on contract managing and auditing, but these internal control documents are not automatically publicly available. A public…
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The annual reports released by each branch of the military provides evidence that if a contract needs changes or contracted firms do not deliver…
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Q68
NEI/100
Are there mechanisms in place to allow companies to complain about perceived malpractice in procurement, and are companies protected from discrimination when they use these mechanisms?
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According to the Transparency Report of the Ministry of Defence, Article 109 of Public Procurement Law 8.666/93 regulates administrative appeals. It establishes deadlines for…
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The assessor found no evidence of companies that have attempted to complain about the procurements processes, which might indicate a lack of transparency of…
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Since there was no evidence that companies have attempted to complain about procurements processes, there was also no evidence of retaliation [1, 2]. Given…
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Companies can be subject to formal admonition, the fines already established in the contract, temporary suspension of any participation in public procurements, and a…
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It is not clear that all suppliers are investigated properly, as there are cases that are resolved within the barracks, without formal processes [1].…
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There is evidence that sanctions are applied in practice since in the Transparency Portal, there is a list of companies who were prosecuted and…
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Offset Contracts
Q70
50/100
When negotiating offset contracts, does the government specifically address corruption risk by imposing anti-corruption due diligence on contractors and third parties?
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There is a 2018 policy that regulates offset contracts for defence acquisitions [1]. It establishes additional guidelines for Public Procurement Law 8.666/1993 and gives…
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Brazil’s Offset Policy does not mention integrity or anti-corruption, but since the procurement process is the same as the one described in the Public…
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There is a 2018 policy that regulates offset contracts for defence acquisitions [1]. It establishes additional guidelines for Public Procurement Law 8.666/1993 and gives…
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There is not a general list with all offset contracts for defence purchases. One can search the offset contracts in the Ministry of Defence’s…
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The Ministry of Defence and the different branches of the military produce annual reports regarding contracts of all types, including offset contracts, these are…
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The assessor could not find evidence in the media or official websites that in all the cases of contracts where the agreed-upon terms were…
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Since offset contracts are subject to the Public Procurement Law, the competition is the standard procedure. Exceptions need to be justified and are often…
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Agents / Brokers
Q73
NEI/100
How strongly does the government control the company’s use of agents and intermediaries in the procurement cycle?
View QuestionFinancing Package
Q74
0/100
Are the principal aspects of the financing package surrounding major arms deals, (such as payment timelines, interest rates, commercial loans or export credit agreements) made publicly available prior to the signing of contracts?
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All information about acquisitions is available in the Transparency Portal from the federal government. However, there are some problems with this portal. As indicated…
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Seller Influence
Q75
NS/100
How common is it for defence acquisition decisions to be based on political influence by selling nations?
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This indicator is not assigned a score in the GDI. In 2017, Operation Zelotes found evidence of a possible undue influence of Lula and…
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This indicator is not assigned a score in the GDI. In the Gripen case, the French influence over former president Lula was undermined by…
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This indicator is not assigned a score in the GDI. There are very few domestic interest groups in Brazil’s defence sector since the Ministry…
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