* Bill imposes fines on companies bribing officials
* Proposal welcomed but approval in Congress uncertain
* Brazil under pressure to crack down on corruption
(Updates with formal proposal of bill)
By Raymond Colitt
BRASILIA, Feb 8 (Reuters) - Brazil's President Luiz Inacio
Lula da Silva proposed to Congress on Monday a bill aiming to
crack down on companies that bribe public officials.
The bill presented by Lula in a public ceremony follows
years of international pressure for Brazil to honor commitments
it made when it signed United Nations and OECD conventions on
corruption.
Under the legislative proposal, a company caught bribing
domestic or foreign public officials would pay a fine of 1-30
percent of its gross income and could even be shut down, the
president's office said in a statement.
Currently companies caught paying off domestic or foreign
officials are simply banned from bidding for future government
procurement contracts.
The bill would also prevent individuals convicted of fraud
from founding a new company and be able to again bid for
government contracts.
Officials of some multinational companies operating in
Brazil privately complain that they are at a disadvantage
because local companies are not bound by tough anti-corruption
laws.
"It's been a thorn in relations with other countries," said
Claudio Abramo, executive director of Sao Paulo-based
Transparencia Brasil, a domestic anti-corruption advocacy
group.
"The bill won't end corruption but it will make it costlier
for companies to practice or tolerate it," he added.
CORRUPTION SCANDALS
The Lula administration itself has been dogged by a series
of corruption scandals. Several of Lula's closest advisors have
been forced to step down due to allegations of racketeering and
fraud.
Lula, a former union leader, was himself close to facing
impeachment proceedings in 2005 because his Workers' Party had
run an illegal campaign financing scheme.
Critics say Lula has often turned a blind eye to corruption
to maintain cohesion in his governing coalition and question
why he waited seven years in office to present the bill.
Still, the influential Brazilian bar association, OAB,
welcomed the proposal, saying not only those receiving bribes
but also those offering them should be punished.
"It's fundamental to have effective punishment on both
sides," said OAB president Ophir Cavalcante, adding that
corruption was the biggest challenge Brazil faced.
Brazil ranked 75th of 180 countries in the Corruption
Perceptions Index published by Transparency International, the
global anti-corruption group.
Despite Lula's majority in Congress, approval of the bill
is uncertain.
With legislators soon to campaign for the Oct. 3 general
election and the soccer World Cup to capture public attention
from mid-June, the window of opportunity to approve the bill is
shrinking.
Congress itself is frequently the scene of high-profile
fraud and embezzlement scandals. Last year numerous legislators
were found to use tax money to take their families on leisure
trips. The head of the Senate admitted he received a generous
housing subsidy he was not entitled to and failed to declare a
mansion to election authorities.
Opinion polls show that only 1-3 percent of Brazilians
trust their national legislature.
(Editing by Cynthia Osterman)
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