CADE approves agreement in investigation on alleged international cartel of maritime pipes

The Administrative Council for Economic Defense – CADE signed, on Wednesday (06/03), a Cease and Desist Agreement (“TCC” for its acronym in Portuguese) with two former executives of the Dunlop Oil and Marine company, from United Kingdom, accused of participating in alleged international cartel in the market of maritime pipes, with effects in Brazil. This product is used to transport oil and its derivatives to oil tankers or installations along the coast and in the high sea.

Reporting Commissioner, Elvino de Carvalho Mendonça, pointed out that this is the first agreement signed between CADE and legal persons within this investigation. According to the TCC, Bryan Allison, who took the position of Dunlop’s Director-Manager between 2001 and 2007, will have to pay a contribution of 250,000 BRL. David Brammar, who acted as Marketing and Sales Director in the company at the same period, will pay 50,000 BRL. It is estimated that the alleged cartel took place from 1999 until 2007.

The cash contribution to be paid by the TCC signatories will be collected to the Brazilian Diffused Rights Fund (“FDD” for its acronym in Portuguese), from the Ministry of Justice.

Beginning of the Investigation - The investigation began in 2007, based on a leniency agreement – which allows for the reduction or elimination of the penalty of a party who denounces the practice and presents evidence for the investigation. The case was formed on the basis of evidences of worldwide price fixing, allocations of markets, clients and volume of maritime pipes. 11 companies and other individuals have been investigated.

Other TCC´s have already been signed between CADE and the companies involved in the case. In 2001, Dunlop confessed its participation and paid the around 16 million BRL. Bridgestone Corporation, Manuli Rubber Industries and Trelleborg Industrie S.A also signed agreements with the Brazilian antitrust authority and paid 1,6 million BRL, 2,1 million BRL and 44,4 million BRL, respectively, as contribution.

The alleged cartel was also investigated by Competition authorities from the United States, United Kingdom, European Union and Japan. The Dunlop’s former executives have already been sentenced to prison and to fines in the United States as well as in the United Kingdom.