CADE’S General Superintendence investigates international cartel on clay substrates for automobiles

The General Superintendence of the Administrative Council for Economic Defense – CADE opened, on 21 December 2015, an Administrative Proceeding to investigate an alleged international cartel, with effects in Brazil, in the clay substrates market, used on automobiles (Administrative Proceeding Nº 08700.009167/215-45). Clay substrates are one of the components of a catalyst that is part of the exhaustion system of the vehicles. 

The investigated companies are Corning Inc. and NGK Insulators Ltd. According to the opinion, there is evidence that the companies were fixing prices and making commercial constraints though goals setting, price standards and discounts given to the automotive vehicles’ assembling companies.  

In addition, the parties shared market and clients though global market-share and worldwide scale of sales coordination. Also there is strong evidence that the companies exchanged sensitive commercial information about prices and quotations, production capacity and sales volume on the market.   

According to the Superintendence, the actions were taken by. At least, 18 individuals connected to Corning and NGK and would have been implemented though e-mail exchanges, telephonic contacts and in-person meetings, possibly, among 1985 and 2011. 
 
With the opening of the Administrative Proceeding, the parties will be notified to present their defenses. At the end of the investigation phase, the General Superintendence will issue an opinion on the condemnation or on the filling of the case and will submit it for judgment by CADE’s Tribunal, which is responsible for the final decision. 

Investigation in the sector: In 2014 and 2015, the General Superintendence opened eight Administrative Proceedings to investigate cartels from different automobile parts. Among them, there are the ones related to the sparking plugs sector (Administrative Proceeding Nº 08700.005789/2014-13), anti-friction bearings (Administrative Proceeding Nº 08012.005324/2012-59), clutch coating (Administrative Proceeding Nº 08700.010321/2012-89), thermal systems, which include radiators, capacitors and heating systems, ventilation and air conditioning (Administrative Proceeding Nº 08700.010323/2012-78), windshield wipers (Administrative Proceeding Nº 08700.010320/2012-34), safety devices for automobiles, like safety belts, airbags and steering wheels (Administrative Proceeding Nº 08700.004631/2015-15) and shock absorber (Administrative Proceeding Nº 08700.004629/2015-38).

Another four markets were already the object from dawn raids complied by the General Superintendence in August 2014, which still may result on the opening of new Administrative Proceedings. The markets are: automotive lighting (headlights, flashlights and brake lights); emergency switches (hazard lights and turn signal switch); access mechanisms (cylinders set, handles, locks and steering locks) and automotive clutches. There are still other investigations ongoing in the car parts sector.