CADE fines entities and individuals from gym sector

On 12 February, the Administrative Council for Economic Defense (CADE) fined entities and individuals in the gym sector of the city of Rio de Janeiro for anticompetitive practices, which limited competition and harmed clients.

The Office of the Superintendent General at CADE launched the case in October 2022, after a complaint from the gyms Smart Fit and Selfit.

According to the investigation, trying to hinder the continuity, expansion, and regular operation of the low cost gym model is a recurring practice in the city of Rio de Janeiro. The defendants, the SINDICAD/RJ (a gym owners’ union of Rio de Janeiro), their members, and the SINPEF/RJ (a fitness trainers’ union of Rio de Janeiro) imposed anticompetitive clauses in a collective labour agreement.

According to Commissioner José Levi, rapporteur of the case, a competitive restriction is legal when based on a clear and fair objective of collective protection, related to the compliance with the Brazilian labour or environment laws.

However, when they interfere with competition, such restrictions need to be appropriate, necessary, and proportional to the expected benefits, which was not what happened with the practice analysed.

As a result, CADE applied BRL 100 thousand in fines to the SINPEF/RJ and BRL 200 thousand in fines to the SINDICAD/RJ. The fines imposed to individuals ranged between BRL 10.3 thousand and BRL 15 thousand. Overall, the amount offines totalled more than BRL 300 thousand.

Access Case no. 08700.005683/2019-24.