Notícias
WORKING PAPER
DEE’s study analyses potential competition effects on Brazilian airline merger reviews
On 25 August, the Department of Economic Studies (DEE) of the Administrative Council for Economic Defense (CADE) published the working paper "Efeitos da concorrência potencial: O caso do ato de concentração Gol-Webjet”, written by Fernando Daniel Franke, the Coordinator of Merger Studies, and Guilherme Resende, Chief Economist of CADE.
The study assesses the impacts of removing a potential competitor in the Brazilian airline sector on flight prices observed in the acquisition of Webjet by Gol in October 2012.The research indicates that Webjet operated, prior to the merger, as a direct competitor of Gol in the sales of some flight routes, as well as a potential competitor in others. Therefore, comparing prices before and after the merger made it possible to estimate the impact of removing potential competitors.
According to the DEE “The results indicate a price rise in those flight routes, from 7,68% to 16,42%. It demonstrates the need to consider potential competition effects in the analysis of mergers and acquisitions".
Cadernos do CADE
First issued in 2014, Cadernos do Cade is a series of documents the Department of Economic Studies regularly publishes to consolidate, systematise and disclose CADE’s case law related to a specific market – considering that market’s economic and competitive aspects.
The study guides CADE towards its institutional mission of providing technical and practical knowledge and contributing to academic works related to antitrust matters.