CADE conditionally clears transaction in financial asset registration market

On 2 September, the Administrative Council for Economic Defense (CADE) approved B3 S.A. (Brasil, Bolsa, Balcão) to acquire 60% of the credit-registry company CRDC’s voting shares, previously owned by São Paulo Commercial Association (ACSP), upon the execution of a merger control agreement.

In addition to the acquisition, a partnership agreement was executed among B3, CRDC, and ACSP to expand their joint operations in the credit solutions market.

The transaction occurs within the context of the introduction of book-entry duplicates, regulated by the Brazilian Central Bank to replace paper with an electronic system, ensuring greater security, transparency, and establishing new forms of relationships among borrowers, financial institutions, as well as book-entry and registration service providers.

In accordance with the opinion issued by the Office of the Superintendent General (SG) and the study conducted by the Department of Economic Studies (DEE), Commissioner José Levi, rapporteur of the case, concluded that the acquisition could raise competition risks. The concerns stemmed from the high concentration in the markets for the registration of paper-based duplicates, Bank Credit Notes (CCBs) and Rural Product Notes (CPRs), as well as particularities of the emerging market for the registration of book-entry duplicates.

The merger control agreement provides for amendments to the partnership agreement and a series of additional obligations aimed at limiting the asymmetries and advantages that B3 might acquire, curbing its inorganic growth, while preventing the practice of tying sales and cross-subsidies.

According to the partnership agreement, the parties are obligated to include a clearer definition of the range of products and services covered by the agreement, to decouple membership benefits and accreditation with ACSP from the contracting of services provided by B3 or CRDC, and refrain from conditioning the provision of incentives or services to customers in the markets affected by the transaction upon the purchase of other products and services offered by B3.

Additional obligations include transparency and governance duties, maintenance of objective and auditable commercial policies, and prohibition on tying sales to non-contestable markets, among others. The rapporteur emphasised the commitment to prevent further acquisitions by competitors that would give B3 over 20% of the voting shares in markets of duplicate registration, CCB, and CPR until 31 December 2029. Furthermore, the company shall notify to CADE any transactions involving B3 and competitors, or book-keeping and registration agents, even if the turnover criteria under Law 12529/2011 are not met, until 31 December 2030.

The merger control agreement also establishes obligations on interoperability, which go beyond the mandatory compliance with the Brazilian Central Bank’s regulations, requiring B3 and CRDC to individually refrain from imposing unnecessary or disproportionate technical requirements, creating artificial operational barriers, unduly delaying technical negotiations, or adopting practices that economically render interoperability.

According to Commissioner Levi, the strong set of remedies will foster effective competition in the affected markets, mainly in the emerging market for book-entry registration, thereby addressing the competition concerns arising from the acquisition.

The merger control agreement will remain in full force and effect for five years with an independent trustee to ensure monitoring and submit half-yearly reports to CADE. Access Case No. 08700.012323/2025-27