SG recommends conviction of fuel stations for cartel conducts

On 25 October, the Office of the Superintendent General (SG/CADE) recommended the conviction of fuel stations in the Federal District for cartel and exchange of competitively sensitive information.

The process was submitted to the Tribunal of CADE and is to be assigned to a Rapporteur for a final decision. If convicted, the companies are to pay fines of up to 20% of their gross turnover, while the administrators may be fined up to 20% of the amount applicable to the company.

The Case

CADE launched an investigation after the Chamber of Deputies of the Federal District (CLDF) filed a report. Based on the complaint, the Brazilian antitrust authority conducted economic studies on the fuel stations market, indicating cartel conducts.

After the interception of telephone conversations, Operation Dubai was carried out in 2015 through the joint action of CADE, the Federal Police, and the Prosecution Services of the Federal District (MPDFT) executing search and seizure warrants at fuel stations and distributors under investigation.

In 2016, the SG applied an interim measure to the largest fuel retailer in the Federal District market, which resulted in the suspension of the group's directors and the appointment of a manager between March and April 2017.

CADE signed a Cease and Desist Agreement with the companies, along with the MPDFT, in 2017. The agreement imposed a fine of more than BRL 90 million, among other obligations already complied with. These measures aimed to reduce a larger market share and to implement a stricter internal control, such as the need for corporate restructuring and divestment by the company.

In 2020, following the investigation, CADE opened an administrative procedure, and based on the evidence gathered, the SG decided that several fuel retailers worked in coordination to increase fuel prices in the Federal District and other cities.