UPDATE FOLLOWING MEDIA REPORTS ON BRAZIL
26 November 2014
Following the announcement of the settlement with the Dutch Public Prosecutor and the declination by the US Department of Justice SBM Offshore has received many questions from all its stakeholders on the situation in Brazil. The Company would like to make the following comments in respect of events in Brazil as they relate to the Company:
The Company reiterates that as reported in its April 2, 2014 press release titled “SBM Offshore Findings of Internal Investigation” there were certain red flags in Brazil however SBM Offshore’s investigation did not find credible evidence that the Company or its agent made improper payments to Brazilian government officials.
As reported on November 12, 2014 the Dutch Public Prosecutor in the context of its own investigation established that payments were made from the accounts of the Company’s agent to government officials in Brazil. As the Dutch Public Prosecutor noted in its press release, it did so using means not available to the Company. The Dutch Public Prosecutor first informed the Company that it was obtaining this information at the end of May 2014 without any further detail.
The Company has had a new Management Board since the beginning of 2012. The Dutch authorities have valued the measures put in place by the new management in terms of compliance, transparency and cooperation with authorities. The allegations made in the media relate to the period before 2012.
As far as SBM Offshore is aware Brazil is the only country in which investigations are currently ongoing that include the Company. The Company has read in the press about formal investigative proceedings instituted against it but has not received any notification thereof. It is in discussion with authorities in Brazil in order to find an expeditious conclusion of any issue involving the Company.
The Company takes the position that with the out-of-court settlement with the Dutch Public Prosecutor it has closed a chapter from the past for which the current management board has shown regret. Given what the Company has done since 2012 to improve its compliance SBM Offshore feels strongly there should be no impediment for it to resume its bidding activities in Brazil as soon as possible. The Company will do what is necessary to preserve its reputation.
The Company does not know what else may surface from investigations still underway. The Company acknowledges that what is taking place in Brazil stretches way beyond the Company and thus it will refrain from publicly commenting on each and every report, even when factual interpretations are given with which the Company disagrees.
There can be no doubt about the Company’s commitment to Brazil: it has in direct employment approximately 4000 people, it produces, with first oil announced on Cidade de Ilhabela, between 250,000 and 380,000 barrels of oil per day for Petrobras (around 15% of Petrobras production) and it co-owns a yard in the Rio area.