CADE convicts executive for cartel in the auto parts market

The Administrative Council for Economic Defense (CADE) convicted an individual and dismissed the case related to two other individuals for a cartel in the aftermarket of auto parts (IAM) and the market of original equipment (OEM).

The tribunal heard the proceeding on 22 May, which originated from another investigation regarding the same cartel. The original proceeding was launched in 2017 after a leniency agreement was signed with the companies Mahle and Mahle GmbH and individuals linked to them. 

According to the investigations, the cartel affected the distribution chain of the following auto parts: engine pistons, rod bearings, engine cylinder liners, connecting rods, ring holders, “O” rings and gaskets, and engine piston rings. In 2021, the Tribunal of CADE observed that the anticompetitive practice consisted of fixing prices and trading conditions for aftermarket sales. The practice included a set of percentages and dates for readjustments. At the time of the hearing, some companies and individuals involved in the case admitted their involvement in the violation and signed a Cease and Desist Agreement with CADE, resulting in more than BRL 30 million in financial contributions.

The rapporteur of the case, Commissioner Carlos Jacques Vieira Gomes, concluded that the evidence was enough to prove the involvement of the former administrative director of the independent aftermarket of the auto parts division of KSPG Automotive Brazil. There was evidence that the executive was involved in the practice of the IAM market between January 2007 and October 2008, and between November 2008 and December 2010. 

Following the opinion of the rapporteur, the Tribunal unanimously found the executive guilty of cartel conduct and convicted him to pay BRL 324,116.00 in fines. The tribunal also decided to dismiss the administrative proceeding regarding two other individuals.