CADE fines fuel transportation union in BRL 1.7 million for anticompetitive practices

On 17 September, the Administrative Council for Economic Defense (CADE) convicted the fuel and other petroleum derivatives transportation union of the state of Minas Gerais (Sindtanque/MG) and two individuals for hindering competition in the sector. Parties involved are to pay over BRL 1.8 million in fines. 

According to the investigation, the entity allegedly imposed price increases to carriers in the state and led mobilisations to push distributors, which influenced the adoption of the concerted practices. 

Thus, the union incited distributors to pass on fees, hampering procompetitive negotiations among the economic agents. In addition, in 2014 CADE convicted Sindtanque/MG for similar practices, which defines recidivism. 

Commissioner José Levi, rapporteur of the case, highlighted that the union used their privilege to press the economic agents to adopt agreements, including physical blockage of carriers and sending communication to demand linear increase in prices for shipping. 

According to the commissioner, the union has legitimacy to plead for changes in the trading conditions that are favourable to their representatives. However, strictly establishing the passing-on value surpasses this capacity “In practice, it will hinder the individual negotiation of the distributors, which could offer trading conditions to have a positive impact on the company’s costs”, he emphasised. Moreover, Mr Levi stated that these actions could harm free competition in the sector of fuel transportation in Minas Gerais. 

Following the opinion of the rapporteur, the council imposed fines amounting to BRL 1,858,336.60 and a prohibition of doing business for 5 years.  

The council also decided that an official letter is to be sent to the State and Federal Prosecution Services of Minas Gerais for knowledge of the decision and possible public civil actions. 

Access Case no. 08700.000211/2015-51.