Responsible financing
Presidency vetoes article of Order 752 that exempts banks from environmental crimes
President Michel Temer signed into law on Tuesday, June 6, Provisional Executive Order No. 752 on public concessions in the transport sector. After intense pressure from civil society organizations and also from Brazil’s environmental watchdog Ibama, the Presidency vetoed article 35, which exempted public banks and other development institutions from responsibility for any environmental damage resulting from the projects they finance.
The vetoed passage included by the sponsor, Congressman Sérgio Souza, stated that financial institutions could only be held liable for environmental damage in partnership contracts in the event of “willful misconduct or negligence and a causal relationship between their conduct and the damage caused”.
In a technical report submitted to the Presidency on Thursday, June 1, the organizations Amigos da Terra, Conectas Human Rights, Greenpeace and ISA (Instituto Socioambiental) denounced the inclusion of the article, claiming that it was a rider that bore no relation to the specific topic of the legislation – a practice that has been banned by the Supreme Court.
According to the organizations, the approval of the article would have promoted the financing of illegal and environmentally damaging activities, encouraged deforestation and made it more difficult to implement public policies.
They also said the article would have violated the principles of precaution, prevention and non-regression – all of which are protected by the Constitution and by international treaties ratified by Brazil.
Click here to read the technical report sent by the organizations to the Presidency.
