CADE dismisses case based on countervailing power

On 23 September, the Tribunal of the Administrative Council for Economic Defense (CADE) decided to dismiss the case that investigated fee guidelines by associations of technicians in the audiovisual (AV) market in the Brazilian state of São Paulo, based on the application of the countervailing power theory.

The Tribunal found asymmetry in bargaining power between technicians and AV production companies. It concluded that the associations helped mitigate this imbalance without eliminating the freedom of individual negotiation, as stated by Diogo Thomson, interim president and rapporteur of the case.

Investigation

The case was launched after a complaint filed by the Brazilian Association of Audiovisual Production (APRO) against the São Paulo Association of Camera Assistants (ACASP) and the Association of Lighting and Machinery Technicians (ASTIM). The investigation examined alleged influence over the adoption of concerted practices by the development and dissemination of fee guidelines for the services provided by affiliated professionals.

As a result, in April 2025, the Office of the Superintendent General of CADE (SG) recommended the conviction of the associations. After the case was assigned to the Tribunal, Rapporteur Diogo Thomson ordered an additional investigation to analyse the countervailing power theory further.

Countervailing Power

There were four criteria to determine whether the aforementioned theory applied: the legitimacy of the agents’ negotiations held on behalf of the professionals, the existence of asymmetry in bargaining power before the conduct without any subsequent reversal of such imbalance, the absence of imposition or coercion, and the balancing of potential competitive impacts against efficiency gains.

The Tribunal of CADE found a structural imbalance in bargaining power that disfavoured technicians. It also considered the associations’ limited ability to exert influence, the preservation of individual freedom of negotiation, and the absence of enforcement, sanctioning, or coercive mechanisms to ensure compliance with the amounts set out in the fee guidelines.

According to the rapporteur, the asymmetry arises from differences in market power between affiliated technicians and production companies, as well as from the characteristics of contractual relationships within the sector, among others. Mr Thomson also weighed the prevalence of the so-called “bogus self-employment”, a practice in which professionals are hired as independent contractors through their own corporate entities, thereby circumventing labour rights.

In view of these facts, the Tribunal ordered the case dismissal. However, it was noted that the conclusion is strictly tied to the circumstances and cannot be

interpreted as a general authorisation for professional associations to adopt price lists. It was also emphasised that any change of circumstances in the reasoning behind this view could give rise to a new investigation and the adoption of necessary measures, if applicable.

Access Case No. 08700.010001/2022-09