CADE determines that Brazilian football leagues must notify transaction

On 17 September, the Office of the Superintendent General at CADE (SG) submitted an administrative procedure for analysis of the Tribunal of CADE, after finding evidence of gun jumping in the creation of the Liga Forte União do Futebol Brasileiro (LFU) and the Liga do Futebol Brasileiro (LIBRA). Gun jumping  is an antitrust violation which occurs when the parties involved consummate mergers before the authority’s clearance.

The procedures were launched to investigate whether the creation of the leagues constituted mergers, which should be previously notified to CADE, as provided by Law 12529/2011.

The SG concluded that there was evidence of gun jumping, stating that LFU and LIBRA constitute a joint venture, which requires a mandatory notification. The leagues are autonomous entities, created through agreements between competing football clubs, with joint management of assets, such as broadcasting rights. Therefore, the parties involved combine their efforts to run the business

The creation of joint ventures between competitors, which had revenues of more than BRL 750 million and BRL 75 million in the year prior to their incorporation, requires mandatory notification and clearance from CADE, as it involves the coordination of strategies and the exchange of sensitive information.

It is important to emphasise that, for now, the analysis is limited to assessing whether the agreements executed for the creation of the leagues should be previously notified to CADE. The competitive impacts of each entity will be assessed later, in specific proceedings, after the notification, when the effects on the market will be analysed.

The proceeding will be assigned to a rapporteur. The Tribunal of CADE is to decide to dismiss or convict the defendants for antitrust violation and impose sanctions according to Law 12529/2011.

Learn more about the entities
Established in June 2022, the LFU is an entity formed with the aim of collectively and exclusively representing its members in the negotiation of their broadcasting rights in the country's main professional men's football competition, in the first and second divisions.

Meanwhile, LIBRA was created in May 2022 with the aim of collectively representing the interests of its members in the organisation of the Brazilian Football Championship, focusing on making its assets more valuable.