Peru to demand more than $1 billion in damages from Odebrecht for corruption case

By January 31, 2018

On the heels of Odebrecht’s far-reaching corruption case, the Peruvian government is seeking $1.1 billion in restitution from the Brazilian engineering conglomerate.

Jorge Ramírez, Peru’s ad hoc attorney assigned to the Odebrecht corruption case, told a local news station Sunday that the compensation is added up from the supposed value of damages from three infrastructure projects linked to the Brazilian firm: the Southern Gas pipeline ($480 million), the Chacas Highway ($80 million), and the South Interoceanic Highway ($540 million).

Ramírez said in that same television interview that Odebrecht initially offered the Peruvian government a much lower sum for the reparations.

“We are waiting for Odebrecht to change their attitude,” he said. “It is not possible for them to offer $66 million in civil reparations.”

Representatives from Odebrecht’s Peru branch responded to Ramírez’s interview with a statement of their own on Monday.

The statement read, in accord with agreements signed with seven other affected countries, that calculations for these restitutions are based on international law. It added that, generally, the amount awarded to these countries is two to three times the amount of the illicit payments, whereas Peru is now requesting 30 times that amount.

The Brazilian firm admitted to the U.S. Department of Justice that it paid $29 million in bribes to Peruvian officials over the course of a decade up until 2014.

“The company will have to carefully evaluate the possible impact and consequences within a reasonable scope to be able to restart the dialogue between competent parties,” read the statement released on Twitter.

It looks as though both Odebrecht and the Peruvian government can look forward to more negotiations going forward as they try to settle on an exact amount of reparations. However, the emergency decree (D.U. 003) that seeks the civil reparations payment is set to expire Feb. 13. According to Peru’s El Comercio newspaper, the country’s Minister of Economy Claudia Cooper said Peru won’t extend the decree but instead make a new decree that continues to seek restitution payments and guarantee the return of infrastructure projects.

The fallout from the scandal has hit the Andean country especially hard, according to Peru’s La República, leaving more than 100 companies in bankruptcy and thousands of workers without jobs. Infrastructure developments have come to a standstill as well, providing no end in sight to the profound dip in jobs. In total, some 350 businesses employing more than 40,000 workers are estimated to be affected, according to Peru’s Gestión news site.