CADE signs agreement with Slavel and Vetor Automóveis for gun jumping

The Administrative Council for Economic Defense (CADE) signed an agreement with Slavel Distribuidora de Automóveis Ltda. and Vetor Automóveis Ltda. for completing a transaction before the clearance from the Brazilian antitrust authority, practice known as gun jumping.

In November 2019, the Office of the Superintendent General (SG) launched the administrative proceeding following an investigation on acquisitions, asset transfers, and commercial establishments run by car dealerships.

At an early stage of the investigation, the SG requested Hyundai for information on dealership transfers from the last 10 years. Hyundai reported the Slavel clearance, among others, that in 2014 sold all concession rights and obligations to commercialise Hyundai's vehicles and parts in Cascavel (PR) to Vetor Automóveis. However, the defendants only notified CADE in May 2021.

The Brazilian Competition Law (Law no. 12529/2011) establishes mandatory reporting to CADE if, in the year preceding the transaction, at least one of the parties has reported a turnover in Brazil of BRL 750 million or more, and at least one other party had a turnover of BRL 75 million or more. In 2013, Grupo InterAlli, owner of Slavel, disclosed over BRL 75 million in turnover, while Grupo Open, connected to Vetor company, turnover in Brazil is over the threshold.

Thus, the SG concluded that the transaction is a case of mandatory reporting and gun jumping, thus subject to sanctions.

The administrative procedure formalised on 1 October 2024 analysed another property alienation involving Slaviero de Cascavel Ltda. and Konrad Paraná Comércio de Caminhões Ltda. During the investigation, the SG requested an opinion from the Office of the Attorney General at CADE, which supported the statute of limitations on the possibility of imposing sanctions.

Finally, in September 2024, the defendants proposed an agreement concerning Slavel and Vetor Automóveis transaction and committed to pay a financial contribution to the Brazilian Fund for De Facto Joint Rights (FDD).  The commissioner Camila Pires-Alves was appointed rapporteur of the case.

The Tribunal of CADE unanimously ratified the agreement, based on the rapporteur's vote and understanding of the statute of limitations.