CADE approves resolution on associative contracts

During its Tribunal session on October 18, the Administrative Council for Economic Defense – CADE has validated Resolution nº 17. The norm regulates the cases concerning the notification of associative contracts, as provided in the item IV of the Article 90 of the Law 12.5291/11, and revokes CADE’s Resolution nº 10, which previously regulated the subject.

According to Resolution nº 17, any contract that remains for two years or more and that establishes a joint enterprise to exploit an economic activity may be considered an associative contract.

In order to be subject to Resolution nº 17, the contracts in question must fulfill the following conditions: the contracting parties must share the risks and results of the economic activity and compete in the relevant market in question.

Resolution nº 17 considers as an economic activity the acquisition or the offer of goods or services in the market, even without profit purposes – in this case, the economic activity may, at least in theory, be exploited by a private company with profit purposes.  

The resolution defines as contracting parties the agents directly involved on the notified legal transaction and their respective economic groups. Contracts signed before Resolution nº 17’s entry into force and whose term of duration are of two or more years, will be submitted to CADE’s evaluation if they are considered associative contracts.

The draft resolution has undergone public consultations between May 11 and July 6, when it was submitted to contributions from various segments of the society. The new rule will be effective 30 days after its publication.