Home Article How Brazil’s Michel Temer could be tried for corruption

How Brazil’s Michel Temer could be tried for corruption

The Financial Times today (Jul 16) offers an unbiased and objective analysis of the current situation in Brazil. We transcribe the article that explains in detail the current Brazilian policy framework and future risks.

Attorney Rodrigo Janot and President Michel Temer

Michel Temer faces the fight of his political career as Brazil’s Congress considers whether the president should be tried for corruption.

Mr Temer was indicted in the Supreme Court last month by the independent public prosecutors’ office after he was caught on tape allegedly discussing bribes with Joesley Batista, a former chairman of JBS, the world’s largest meatpacker.

Brazil’s constitution offers special protections for politicians, making it hard to bring any one of them down, let alone a president. However, it is not impossible, as Dilma Rousseff, the leftwing former president, found when she was impeached last year for manipulating the budget — a move that brought Mr Temer to power. Congress is set to decide on August 2.

Here is an explanation of the process and some of the political implications of the attempt to try Mr Temer for corruption — a first for a sitting Brazilian president.

What is Michel Temer accused of?

Rodrigo Janot, the chief public prosecutor, has accused Mr Temer of “passive corruption” in relation to the JBS case. Mr Batista secretly taped the president during a private discussion at Mr Temer’s residence in Brasília in March.

During this discussion, Mr Temer allegedly suggested that Mr Batista speak to Rodrigo Rocha Loures, his former special assistant, to resolve problems affecting JBS’s businesses. Mr Loures was later filmed by police walking away from JBS with a suitcase containing R$500,000. The prosecution alleges it was the first instalment of R$38m in bribes.

Mr Janot has further charges — obstruction of justice and forming a criminal organisation — that he is expected to bring separately against Mr Temer in relation to the conversation with JBS.

What are the steps to bring the matter to trial?

Under the constitution, the president can be tried only for a common crime in the Supreme Court. But the court must first seek the permission of two-thirds of the lower house of Congress to open a trial.

Any indictment must start at the court, which forwards the matter to the speaker of the lower house — in this case Rodrigo Maia, a member of Mr Temer’s governing alliance but one whose support for the president has reportedly wavered.

The speaker must send the matter to the house’s justice and constitution commission, which appoints a rapporteur to oversee the case and prepare a report that is debated by the committee. Sergio Zveiter, the rapporteur in this case, prepared a report recommending Congress allow the court to try the matter but Mr Temer’s allies countered his report and the commission voted against the indictment 40 to 25 with one abstention.

What happens if the case is tried?

While a symbolic victory for Mr Temer, the outcome of the commission’s vote does not formally influence the next stage of the process — a vote in a full session of the lower house. If Congress decides by a two-thirds majority in the vote, scheduled for August 2, to allow the trial, the matter returns to the Supreme Court, which must decide if it will accept the case. If the answer is yes, Mr Temer will be suspended for up to 180 days and Mr Maia will become acting president during the trial.

If Mr Temer is convicted, he is thrown out of office and Mr Maia must call an indirect election within 30 days, in which Congress will select a new leader until the next elections in late 2018. The whole process could take up to seven months or more, analysts say.

What happens now?

While Mr Temer is expected to survive the vote on the first indictment, he could face two additional sets of accusations in the coming months, say experts. This could erode his support in Congress as lawmakers begin to look to next year’s elections.

What of Brazil’s economy and reforms?

Mr Temer’s main claim to legitimacy after coming to power was an ambitious reform programme aimed at shoring up Brazil’s deteriorating fiscal position. Though deeply unpopular with the public, his proposed reforms won him support from business and the capital markets.

He has delivered some reforms, but one key issue — the overhaul of the unfunded pension system — is outstanding. Congress this month passed a labour reform, which was a gain for Mr Temer. However, summoning the support of three-fifths of Congress needed to pass the pension changes is looking difficult.

In Mr Temer’s favour is that the economy, which is emerging from its worst recession in history, has stabilised since the impeachment, with inflation falling to multiyear lows. His main political hope remains to resolve the JBS scandal quickly and resume the reform process. But the longer the case drags on, the worse the outlook for him and his reforms.