Agrofert is to pay over BRL 500,000 for gun jumping

On 05 June, the Administrative Council for Economic Defense (CADE) signed an agreement with the Agrofert which completed the acquisition of Borealis NITRO without CADE’s previous clearance— practice  known as gun jumping. 

The case involves the acquisition of Borealis NITRO by Agrofert, according to the stock purchase agreement signed  in July 2022. 

In September 2023, the Office of the Superintendent General of CADE launched an administrative procedure to investigate the acquisition agreement. 

Upon request from the antitrust agency, Agrofert presented further information on the transaction. Agrofert mentioned that the acquisition was spontaneously notified to CADE after the consummation of the deal, with no intention of concealing it from the authority. 

After the enquiry, the Office of the Superintendent General concluded that the transaction was an acquisition agreement, which fit the criteria for mandatory reporting to the antitrust authority before its completion as per the terms of Law 12529/2011 (the Brazilian Competition Law). 

Commissioner Diogo Thomson de Andrade presented evidence in the case and found that, although the transaction spanned multiple jurisdictions, the examination of the accounting data and documents provided by the parties indicated that the turnover of the acquired company in Brazil was relatively small within the global economic group. Thus, it would justify the conditioning of the value of the transaction to the Brazilian market, avoiding the imposition of unreasonable penalties. 

Following the vote of the rapporteur of the case, Commissioner Diogo Thomson de Andrade, the Tribunal unanimously agreed that the firms committed a violation and ratified the acquisition agreement. Agrofert is to make a financial contribution of more than BRL 500,000 to the Fund for De Facto Joint Rights (FDD) kept by the Ministry of Justice and Public Security (MJSP).