CADE fines cartel in market of car filters BRL 235 million

This Wednesday (5 October 2021), the Administrative Council for Economic Defense (CADE) fined five individuals and the companies Parker Hannifin Indústria e Comércio and Mann + Hummel Brasil for cartel practice in the market of car filters, sold to the independent automotive aftermarket (IAM) industry. The fines amounted BRL 235 million.

The investigation was launched in 2017, when CADE signed a leniency agreement with firm Mahle Metal Leve and 18 employees. From the evidence presented by the agreement applicants, CADE's Office of the Superintendent General split the investigation into other cases, launching a new proceeding in 2019 to analyse Parker's conduct. The evidence led to judgements against both Mann + Hummer and its employees and Parker, which were announced this Wednesday.

Based on the case investigation, the involved parties agreed on prices, conditions, and competitive advantages, and shared competitively sensitive information, harming free competition in this industry in Brazil. Such anticompetitive conduct occurred at least between 2011 and 2012.

Cartel arrangements were made at meetings between representatives of the companies involved in the illegal conduct and through the exchange of e-mails between the competitors — in which they defined percentages and deadlines for price rises.

The cartelists also established customers' payment conditions and prevented other participants from granting any discounts without the group's previous approval. Additionally, the collected evidence includes notes, price sheets, and the meeting's schedules and agenda.

For engaging in illegal activities, Mann + Hummel Brasil was fined BRL 140.7 million. As for the fines levied on individuals connected to the company, they totalled over BRL 3.6 million.

As far as Parker is concerned, evidence such as minutes and e-mails proved its participation in the collusive meetings. From 2002 to 2005, the company was relevantly involved in the cartel, adhering to the agreement until 2008.

For this reason, the firm was fined BRL 90,720,314.34. The individual investigated in the same proceeding had its claims dismissed for lack of evidence.

Agreements

Since the obligations have been met, the Tribunal granted immunity from prosecution to Mahle Metal Leve and the 18 individuals through a leniency agreement.

Moreover, the Council dismissed the original case's claims against companies Sofape Fabricante de Filtros and Sogefi Filtration do Brazil, in addition to eight individuals, contingent on fully meeting the obligations established in their Cease and Desist Agreements.

Finally, with regard to companies Nakata Automotiva and Robert Bosch, and eight individuals, the Tribunal dismissed the original proceeding as they fully met the conditions in the settlements.

The four Cease and Desist Agreements executed with CADE accounted for more than BRL 51.8 million in financial contributions to the Brazilian Treasury.

Access the Administrative Process No. 08700.003340/2017-63 (primary proceeding).

Access the Administrative Proceeding No. 08700.006005/2019-89 (dismembered proceeding).