Convicted Industrial Gas Companies go to Court

Last month several Industrial Gas Manufactures and Individuals were convicted by CADE for illegal collusion with a historic fine. Since last week many of them have filed actions before the Federal Court against CADE´s decision and the fines applied. So far, manufacturer Linde Gases has gotten an injunction from the Federal Court in Brasília to stop CADE from executing the fine. This injunction is being allowed only if the Company deposits a warranty in the same amount of the fine imposed by CADE.

The one highlight of CADE's last Session: Industrial gas manufactures convicted for cartel

During CADE's Session in August 4, 2010, industrial gas manufacturers Linde, Air Liquide, Air Products, Indústria Brasileira de Gases and White Martins, as well as seven individuals connected to the companies, have been convicted for illegal collusion. According to CADE's decision, which was unanimous, companies and individuals have been involved in market division practices, with serious consequences to the Brazilian market and to the public health system. Upon impediment, CADE's President Arthur Badin and Commissioner Olavo Chinaglia have not participated in the judgment.

The investigation has been initiated in 2003 and culminated with the highest administrative fines ever imposed by CADE (totalizing R$ 2.9 billion – approximately US$ 1.7 billion). The case has been distinguished by several judicial and administrative incidents. Criminal investigations - still in course - included dawn raids and wires, and their fruits have been transferred to the administrative investigation, which has been strongly challenged by companies and individuals. The case against one particular individual has been shelved.

Besides fines, CADE recommended that federal authorities did not grant tax benefits or subsidies to the convicted companies, and that existing benefits were cancelled. Finally, CADE determined that the decision and other materials of the files were published in the Midia.