CADE's 511ª Section that happened yesterday, March 28th was the fastest in the history of the Board.
With all the concentration acts being approved in the fast track analysis, and just one cartel case (on oil sector) dismissed, the section lasted only 25 minutes. Cases of Hypermarcas, Novartis and Odebrecht and EBX Groups were all cleared.
From May 30 on, Brazilian Antitrust Law will demand previous analysis and approval.
10/11/2011
New antitrust bill approved by the Brazilian Parliament
A new antitrust bill has been approved last week by the Brazilian Parliament. The bill has still to be approved by the President Dilma Rousseff and published in the Official Gazette.
It will not come into force before 180 days of its publication. During this time, the authorities will prepare the transition for the new system.
The bill creates the mandatory pre-merger notification, with severe fines for gfun jumping, and a new structure for the antitrust bodies. Thresholds for mandatory notification will be 400 million Reais (for at least one of the Applicants' Group in Brazil) plus 30 million Reais of the other Group, replacing the current alternative criteria (400 million Reais for at least one of the Groups in Brazil or the transaction resulting in a market share of 20% of more in at least one relevant market).
Other relevant modifications include a new system of fines for anticompetitive behavior (for companies and individuals).
It will not come into force before 180 days of its publication. During this time, the authorities will prepare the transition for the new system.
The bill creates the mandatory pre-merger notification, with severe fines for gfun jumping, and a new structure for the antitrust bodies. Thresholds for mandatory notification will be 400 million Reais (for at least one of the Applicants' Group in Brazil) plus 30 million Reais of the other Group, replacing the current alternative criteria (400 million Reais for at least one of the Groups in Brazil or the transaction resulting in a market share of 20% of more in at least one relevant market).
Other relevant modifications include a new system of fines for anticompetitive behavior (for companies and individuals).
5/19/2011
CADE'S BOARD IS NOW COMPLETE, WITH CHALLENGES AHEAD
Three new Commissioners formally took office on May 4, 2011 at CADE. At the same date, Fernando Furlan (former Commissioner and acting-President of CADE) took office as President of the autarchy, which is the higher administrative authority in antitrust enforcement in Brazil.
With this assignments, CADE's Board is complete again.
Headed by Fernando Furlan, the Board is now composed by Olavo Chinaglia (the dean, in his second mandate), Carlos Ragazzo (in his second mandate), Ricardo Ruiz (in his first mandate, since January 2010), Alessandro Octaviani (in his first mandate, since April 2011), Elvino Mendonça (former SEAE, in his first mandate, since May 2011), and Marcos Paulo Verissimo (former BNDES, in his first mandate, since May 2011).
The new Board will decide important cases, both in merger and behavior antitrust control areas. Perdigão- Sadia transaction (creating the giant Brasil Foods) will probably be the first one. The transaction returned to the Midia after CADE's General Attorney office issued a non-binding opinion conditioning its approval to major restrictions (including relevant divestments). The stock market reacted and Brasil Foods' stocks dropped substantially at BMF-Bovespa, what caused a heated exchange of public declarations between the company 's management and the General Attorney. CADE's decision in this case will be polemic, independently of the results. One of the new Commissioners (Elvino Mendonça) and CADE's president Fulan are prevented and will not participate in the judgment. Mendonça is part of the team that signed SEAE's opinion; Furlan is related to Sadia's executives.
With this assignments, CADE's Board is complete again.
Headed by Fernando Furlan, the Board is now composed by Olavo Chinaglia (the dean, in his second mandate), Carlos Ragazzo (in his second mandate), Ricardo Ruiz (in his first mandate, since January 2010), Alessandro Octaviani (in his first mandate, since April 2011), Elvino Mendonça (former SEAE, in his first mandate, since May 2011), and Marcos Paulo Verissimo (former BNDES, in his first mandate, since May 2011).
The new Board will decide important cases, both in merger and behavior antitrust control areas. Perdigão- Sadia transaction (creating the giant Brasil Foods) will probably be the first one. The transaction returned to the Midia after CADE's General Attorney office issued a non-binding opinion conditioning its approval to major restrictions (including relevant divestments). The stock market reacted and Brasil Foods' stocks dropped substantially at BMF-Bovespa, what caused a heated exchange of public declarations between the company 's management and the General Attorney. CADE's decision in this case will be polemic, independently of the results. One of the new Commissioners (Elvino Mendonça) and CADE's president Fulan are prevented and will not participate in the judgment. Mendonça is part of the team that signed SEAE's opinion; Furlan is related to Sadia's executives.
3/02/2011
CADE grants clearence to the creation of largest petrochemical group of the Americas
The Conselho Administrativo de Defesa Econômica (Cade) approved on February 23 the purchase of Quattor by Braskem, creating the largest petrochemical group in the Americas.
As a condition for granting clearance CADE imposed some obligations on the Parties to enable the enforcer to monitor the group´s operations.
For instance, the merged entity shall previously notify CADE about any exclusive thermoplastic resin agreements entered into with overseas suppliers, as well as reporting several data on a periodic basis so the enforcer can monitor performance of the market.
All thermoplastic resin related contracts utilized buy foreign companies on the commercialization of the product must be informed to CADE, as well as any other form of contract that may confer with Braskem some sort of exclusivity.
Despite of the high concentration on the raw petrochemical material in the market, the Commissioners considered that there is not a threat to competition because of the possibility of the customers to turn to the international market to obtain its supply of material.
2/27/2011
Magazine Luiza acquisiton approved by CADE with restrictions
Magazine Luiza acquisition of FS Vasconcelos e Cia Ltda ("Lojas Maia") was approved by CADE with restrictions referring to the non-competition clause in the geographic dimension.
Magazine Luiza is one of the major retail and durable goods chain of stores in Brazil. It has 459 stores in seven states and also acts on e-commerce delivering products to the whole country. Lojas Maia has 133 stores in nine states.
The Secretariat of Economic Monitoring (SEAE) had released and opinion suggesting the approval of the transaction with restrictions on the non-competition clause to adequate it on the geographic feature, restricting the clause to some municipalities.
The Reporting Counselor voted on the same line as SEAE suggested to approve the operation with restrictions of the non-competition geographic clause to have municipal dimension and its validity only in cities in the states of Alagoas, Bahia, Ceara, Maranhão, Paraiba, Pernambuco, Piauí, Sergipe and Rio Grande do Norte.
All the other counselors agreed with the Reporting Counselor.
Magazine Luiza is one of the major retail and durable goods chain of stores in Brazil. It has 459 stores in seven states and also acts on e-commerce delivering products to the whole country. Lojas Maia has 133 stores in nine states.
The Secretariat of Economic Monitoring (SEAE) had released and opinion suggesting the approval of the transaction with restrictions on the non-competition clause to adequate it on the geographic feature, restricting the clause to some municipalities.
The Reporting Counselor voted on the same line as SEAE suggested to approve the operation with restrictions of the non-competition geographic clause to have municipal dimension and its validity only in cities in the states of Alagoas, Bahia, Ceara, Maranhão, Paraiba, Pernambuco, Piauí, Sergipe and Rio Grande do Norte.
All the other counselors agreed with the Reporting Counselor.
2/18/2011
CADE may appoint an intervenor at Saint Gobain plant
In July 2008 CADE rejected the acquisition by Owens Corning of Compagnie de Saint Gobain's fiberglass division in Brazil. The acquisition was part of a multinational deal, and marked one of the few opportunities in which CADE has blocked a transaction completely. At the time, the Brazilian competition agency provided Owens Corning with a deadline until February 1st 2011 to either divest a Saint Gobain's plant in State of São Paulo or submit a strategic plan for the sale to be completed (as the use of an independent investor to intermediate the divestiture).
According to a statement by CADE's President Fernando Furlan earlier this week, the deadline expired without any alternative solution being suggested by Owens Corning, which could cause CADE to begin an intervention at the former Saint Gobain's plant until the manufacturing unit is sold to an independent third-party. This would be the first time in CADE's history that it would make use of the powers granted by article 63 of the local antitrust law ("the execution of CADE's decisions shall be carried out by all means, including by way of intervention in the company, if necessary").
According to a statement by CADE's President Fernando Furlan earlier this week, the deadline expired without any alternative solution being suggested by Owens Corning, which could cause CADE to begin an intervention at the former Saint Gobain's plant until the manufacturing unit is sold to an independent third-party. This would be the first time in CADE's history that it would make use of the powers granted by article 63 of the local antitrust law ("the execution of CADE's decisions shall be carried out by all means, including by way of intervention in the company, if necessary").
2/14/2011
Health Care Insurance Acquisiton Approved by CADE.
CADE has approved the acquisition of health care insurance companies "Planos de Saúde Integrais S.A.", "Assistência Médica São Paulo S.A." and "Orion Participação e Administração S.A." by Amil Assistência Médica Internacional Ltda last Wednesday - February 9th, 2011. The Counselors decided to follow the guidance of the National Health Insurance Agency ("ANS") over the territorial concept advocated by the Secretary of Economic Monitoring ("SEAE") in the analysis of the relevant market in the sectors of health care services providence and health insurance sales. The Counselors approved the transaction with a restriction of the non-competition clause for the next five years in markets operated by "Assistência Médica São Paulo S.A." and "Planos de Saúde Integrais".
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