CADE opens administrative proceeding to investigate school meals cartel in São Paulo

The General Superintendence of the Administrative Council for Economic Defense – CADE opened, on 7 November 2014, administrative proceeding to investigate an alleged cartel on public procurements held by cities of the state of São Paulo to hire outsourced services for the provision of school meals. There is evidence that 12 companies and 15 executives would have traded information and coordinated themselves to fix prices, to obtain advantages in public bids and to share the market of school meals in the metropolitan regions of São Paulo and Campinas, and in the region of the city of Sorocaba.

The administrative proceeding was opened from documents forwarded by the São Paulo State Prosecutor’s Office (MP/SP). The documents raise evidence that the companies Serra Leste Indústria Comércio Importação e Exportação Ltda, SP Alimentação e Serviços Ltda, Terra Azul Alimentação Coletiva e Serviços Ltda, Sistal Alimentação de Coletividade Ltda, Geraldo J. Coan e Cia Ltda, Sha Comércio de Alimentos Ltda, Nutriplus Alimentação e Tecnologia Ltda, Convida Alimentação e Tecnologia Ltda, and Comercial Milano do Brasil Ltda kept periodic meetings to agree and monitor the school meals market division. The meetings between the competitors were held at one of the companies’ headquarters.

CADE’s General Superintendence also observed evidence that the actions of the alleged cartel would have hindered several municipalities of the metropolitan regions of São Paulo and Campinas, and of the city of Sorocaba and vicinity. Thus, it would have eliminated competition in public bids held to contract services for the provision of school meals in these locations. More than 40,000 documents of public procurement, held between 2008 and 2013, were used. The analysis proved the strong indication of geographic division of the affected market, pointed initially by the MP/SP.

After the opening of the administrative proceeding (no. 08012.010022/2008-16), the charged parties will be notified to present their defense within 30 days. By the end of this period, the General Superintendence will submit the case to judgment by CADE’s Tribunal.