CADE recommends conviction of company in water heater market

On 5 September, the Office of the Superintendent General of CADE (SG) recommended the conviction of the Japanese multinational company Rinnai for anticompetitive conduct in the Brazilian water heater market.

The investigation started after a complaint posted on the Clique-Denúncia platform in April 2022, which indicated that Rinnai was adopting minimum advertised pricing, an antitrust violation. Through CADE’s Clique-Denúncia, any individual or company may report practices that harm free competition.

The respondent set a price range to suppliers that was related to several means of mass communication, including advertisement through marketplaces, resellers websites, electronic and printed flyers, among others.

The SG observed that the practices by Rinnai mainly affected e-commerce activities, where bargaining possibilities are lower, with products  sold, for the most part, by the advertised prices. Therefore, the conduct affected resellers that use electronic wholesale to trade products, as well as the consumers purchasing online.

Evidence showed that Rinnai had a software to monitor advertising prices on the internet. Several resellers had commercial conditions revised, since their advertisements were not adequate to Rinnai’s prices, which were established in a short period of time.

The SG concluded there was antitrust violation and recommended imposing a fine.

The proceeding was sent to the agency’s Tribunal and is to be assigned to a Rapporteur. Then, the proceeding is to be submitted to the Tribunal of CADE for a final decision. The Tribunal of CADE is to decide to dismiss or convict the defendants for antitrust violation and impose sanctions according to Law 12529/2011.

The case is the first launched, analysed, and sent to the Tribunal of CADE with a suggestion for conviction from the Antitrust Analysis Unit 11 (CGAA11), the SG unity dedicated to the analysis of unilateral conducts created in May 2022. Since then, it has committed to the SG to speed up the investigations on complaints of abuse in several markets.

Access Case  no. 08700.002702/2022-66.