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Brazilian Companies Face Scrutiny Over Alleged Use of Slave-Like Labor

Brazilian prosecutors have launched a public civil action against JBS NV and Cargill Agrícola SA, two major companies accused of systematically sourcing supplies from vendors linked to slavery-like labor conditions. This case is part of the "Reação em Cadeia" operation, a nationwide investigation into modern slavery across Brazil's supply chains.

The investigation, which covers the period from 2024 through 2026, targets over 30 Brazilian companies and public entities. Companies have been formally notified to provide clarifications over transactions with suppliers determined to have used slave-like labor. Prosecutors have stated that the financial volume traced exceeds 48 billion reais ($9.6 billion) in commercial operations between top-tier companies and suppliers on the Labor Ministry's "dirty list."

The Public Prosecutor's Office for Labor has strong evidence that these companies systematically acquired supplies from vendors who subjected workers to conditions analogous to slavery. However, prosecutors have not provided details of the evidence related to the labor conditions.

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A recent civil inquiry by prosecutors in the state of Pará that cited JBS focused on purchases of cattle from farms included on the ministry's "dirty list." National coordinator Luciano Aragão stated that additional companies are under review and could either be found compliant or required to sign a conduct adjustment agreement.

Nine other companies, including Gol Combustíveis SA, agreed to the terms and committed to stricter compliance measures. JBS and Cargill declined to sign a conduct adjustment agreement that would have required stronger oversight of their supply chains. The companies did not immediately respond to a request for comment.

Comparison of Companies' Actions

CompanyActionCompliance Measures
JBS NVDeclined to sign conduct adjustment agreementN/A
Cargill Agrícola SADeclined to sign conduct adjustment agreementN/A
Gol Combustíveis SAAgreed to terms and committed to stricter compliance measuresImplemented
Other 9 companiesAgreed to terms and committed to stricter compliance measuresImplemented

The operation underscores growing scrutiny of corporate supply chains in Brazil, particularly in agriculture and fuel distribution, as authorities step up efforts to combat forced labor practices. Since 2013, Brazil's agricultural sector has accounted for roughly 3.2 billion reais in purchases from suppliers identified as using slavery-like labor, according to prosecutors.

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Throughout this first phase, labor prosecutors across the country produced more than 30 technical tracking reports, mapping the flow of goods and services in key sectors of the economy. The consolidation of this national data reveals a challenging scenario: Large companies and economic groups, often with billions in revenue, appear as direct or indirect beneficiaries of a degraded workforce.

Among the penalties established for companies that fail to meet due diligence requirements are financial compensation for moral and collective damages, as well as fines for failing to ensure proper monitoring of their supply chains.

Investor Takeaway

Investors should be cautious of companies with ties to suppliers implicated in human trafficking and slave labor practices.

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