Cartels 2024 Comparisons

The main statutory basis for challenging anticompetitive conduct in Brazil is, at the administrative level, Federal Law No 12,529/2011 (the Brazilian Competition Law). This is the relevant statute that (i) organises the Brazilian antitrust authority, the Administrative Council for Economic Defence (Conselho Administrativo de Defesa Econômica, CADE), (ii) governs the administrative prosecution of horizontal, vertical and unilateral anticompetitive conduct, and (iii) provides the basis for mandatory merger control in Brazil.

At the criminal level, Federal Law No 8,137/1990 defines as crimes against the economic order the following conducts: (i) abusing economic power by dominating the market or eliminating, totally or partially, competition through any form of adjustment or agreement, and (ii) forming an agreement, adjustment or alliance among competitors with the objective of (a) artificially fixing prices or quantities, (b) dominating the market, or (c) controlling, to the detriment of competition, a network of suppliers or distributors. Only individuals are subject to criminal antitrust prosecution in Brazil.

Federal Law No 14,133/2021 governs public bids and contains additional administrative and criminal provisions on bid-rigging. Federal Law No 12,846/2013, which governs the administrative prosecution of corrupt practices and includes fraud against public bids as an administrative violation, may also apply.

Damages caused by anticompetitive conduct may be claimed under the Brazilian Competition Law, the Brazilian Civil Code and the Brazilian Consumer Protection Code, both on an individual and collective (class action) basis. In the latter case, public prosecutors (but not individual claimants) are allowed to initiate the corresponding class action proceedings, based on Federal Law No 7.347/1985.

Administrative Enforcement

CADE has jurisdiction to apply administrative sanctions for violations of the Competition Law. These sanctions may include:

• fines against the involved undertakings, ranging from 0.1% to 20% of their gross revenues in the affected “business sector” over the year prior to the beginning of the investigation (unless the resulting fine is less than the undue advantage obtained with the conduct, in which case this will prevail);
• fines against the executives of such undertakings which were personally involved in the illegal conduct, ranging from 1% to 20% of the fines imposed on their employer;
• fines against business associations, other individuals and other legal entities involved in the conduct, with no commercial activities or turnover, ranging from about USD10,000 to about USD390 million; and
• a general ban from entering into agreements with official financial institutions and administrative bodies at federal, state, and municipal level, for at least five years.

In extreme cases, CADE can also order mandatory spin-offs, the divestment of assets, changes in corporate control, prohibition from operating in the market, or any other measure that might be necessary to eliminate the anticompetitive effects resulting from the illegal conduct.

CADE’s Structure

CADE has three autonomous bodies: the Administrative Tribunal (“Tribunal”), the General Superintendence (SG), and the Department of Economic Studies (DEE).

CADE’s Tribunal (composed of seven commissioners, including CADE’s president) is responsible for applying the above-mentioned sanctions. CADE’s SG is responsible for the investigation of cases and CADE’s DEE is responsible for providing economic assistance to both the Tribunal and SG.

In cases involving antitrust violations, CADE’s attorney general also issues opinions and assists. A specialised representative of the Federal Prosecutor’s Office works along with CADE in such cases as well, issuing opinions and recommendations and sometimes facilitating interaction with criminal prosecutors.

Criminal Enforcement

Crimes established by Law No 8,137/1990 are mainly prosecuted by state prosecutors before state criminal courts. The corresponding investigations are initiated and conducted by the police and complaints are subsequently submitted by the Public Prosecutor’s Office. The applicable penalties are imposed by the courts.

Civil Enforcement

Civil courts may get involved in the enforcement of the Competition Law in different capacities. They may assist CADE’s investigations by enforcing its decisions or issuing injunctions or authorisations for dawn raids in non-criminal matters. They can directly apply the Competition Law (for purposes different than the imposition of fines, which can only be imposed by CADE) if requested by private affected parties or public civil prosecutors. This competence may be exercised to issue awards for damages or even injunctions against companies for an alleged violation of the economic order. Civil courts can also review the merits of final and interim decisions rendered by CADE.

Article 47 of the Brazilian Competition Law grants a general private right of action for individuals or legal entities affected by anticompetitive conduct. This right is generally independent from CADE’s prosecution and includes authorisation to seek compensation before the courts for damages and to request injunctions aimed at stopping illegal practices. Public prosecutors may also initiate civil actions based on Article 47 to defend collective rights or the integrity of the market as a whole.

Individuals may offer notices of anticompetitive practice to CADE, which also has a whistle-blowing channel.

In the criminal area, there is no private right of action for crimes against the economic order and only public prosecutors can issue the corresponding criminal indictments. However, individuals and affected parties may present notices of crime to those prosecutors or to the police.

Brazilian legislation does not provide for a statutory definition of “cartel conduct”. Law No 8,137/1990 does not even use that word and the Competition Law only mentions the expression “cartel” very briefly in one of its articles, related to criminal matters. Apart from that brief reference in the Competition Law, the only other statute that mentions the word “cartel” in Brazil is Law No 10.446/02, which authorises the Federal Police to investigate certain crimes that would otherwise fall within the jurisdiction of the states, including crimes of “cartel formation”, which would be those established by Law No 8,137/1990 (see 1.1 Statutory Bases for Challenging Cartel Behaviour/Effects).

Defining a “cartel” as a separate legal category is not essential for most civil and administrative purposes because the Competition Law deals with horizontal, vertical and unilateral conduct in Article 36. This provision classifies as a violation against the economic order the committing of any act “with the object, or which may have the capacity of producing the effects… of (i) limiting, distorting or in any way harming free competition or free enterprise, (ii) dominating a relevant market for goods or services, (iii) arbitrarily increasing profits, and (iv) abusively exercising a dominant position”. Paragraph 3 contains a non-exhaustive list of conducts that may exemplify such violations.

All conducts falling under Article 36 are subject in theory to the same potential penalties, but price-fixing agreements, and adjustments to divide markets, allocate consumers or suppliers, establish quotas or restrict production, or defraud public bids, are in pratice subject to heavier penalties. These conducts are considered by CADE as violations “by object”, or “per se violations”, which do not require economic analysis to be unlawful.

At the criminal level, the violations established by Law No 8,137/1990 (see 1.1 Statutory Bases for Challenging Cartel Behaviour/Effects) are usually referred to as “cartel” crimes. The courts have taken the stance that for such acts to be legally characterised as cartel crimes, they must have market-wide consequences or scope. Therefore, a one-off agreement to defraud a public bid would not constitute a “cartel” crime, for instance, but only the crime of bid-rigging, which has different consequences (CADE, on the other hand, sometimes uses the word “cartel” in a broader sense, but this, as said, has no specific legal consequences at the administrative level).

Other horizontal conducts may be considered administrative (but not criminal) violations, with or without “by object” treatment, without necessarily falling under the “cartel” concept. Tables of suggested prices published by trade associations are one such example. The exchange of competitively sensitive information among competitors may be another. Sometimes CADE refers to such conduct under the “cartel” umbrella, but this usually has no major relevance at the administrative level. Brazilian courts have decided on some occasions that the mere potential exchange of sensitive information among competitors would not qualify as a “cartel”, and CADE, in at least one relevant precedent, has also decided that the exchange of sensitive information should be differentiated from hard-core cartel conduct also for administrative purposes (especially in view of the corresponding periods of limitation, which would be different, as explained in 1.5 Limitation Periods). This matter is not entirely established yet. Depending on its nature and configuration, exchange of information may be treated by CADE as a violation “by object” or “by effects”.

There is no statutory exemption for collusive practices in Brazil.

At the administrative level, there is a five-year limitation period for antitrust violations, commencing from the date of the violation or, if it is a continuing offence, from the day on which the illicit activity has ceased. Actions aimed at investigating the violation have the effect of interrupting the limitation period, causing it to restart from the beginning. The same applies to the notification of the parties under investigation. Ongoing investigations which remain inactive for more than three years will also be time-barred.

A different rule applies, however, to antitrust violations that also constitute criminal offences, such as those provided for by Law No 8,137/1990 (see 1.1 Statutory Bases for Challenging Cartel Behaviour/Effects). In this case, the limitation period applicable to the imposition of administrative fines is equal to the criminal one and may be as long as 12 years. Brazilian law is inconsistent with respect to the need of a concurrent actual criminal investigation to trigger this special rule, but CADE’s precedents typically hold that such an investigation is not required. On the other hand, CADE has decided in at least one precedent (as mentioned in 1.4 Definition of “Cartel Conduct”) that horizontal practices that do not characterise “hard-core cartels”, such as the exchange of sensitive information, would not trigger this special rule, because they are not crimes under Law No 8,137/1990.

There is a five-year limitation period for civil claims for damages based on antitrust violations, starting from the “unequivocal knowledge of the illicit act”. In the case of agreements among competitors to fix prices, quantities, or markets, or promote uniform conduct in the market (Article 36, §3, I and II of the Competition Law), the limitation period does not run during the corresponding administrative investigation.

The Competition Law applies to practices (i) executed totally or in part in Brazil, and (ii) which may produce effects in Brazil. A conduct that has entirely occurred in foreign jurisdictions may be subject to Brazilian law if it is possible to determine that the corresponding affected products or services were (or might have otherwise been) offered to or exported to Brazil. In case of international cartels, even undertakings which have never exported to Brazil may be subject to Brazilian jurisdiction if evidence exists showing that they have agreed not to do so because of a wider arrangement with competitors. CADE has established its jurisdiction even in cases involving only indirect effects; ie, products that were sold to third parties that eventually incorporated them into their own products which were offered to Brazil. This, however, seems to be a very questionable interpretation of the statute. If at least a reasonable link with Brazil cannot be established, Brazilian jurisdiction would not apply.

At the criminal level, Articles 5-8 of the Brazilian Criminal Code have similar provisions, establishing that the Brazilian criminal jurisdiction would apply to (i) crimes committed in Brazil, and (ii) crimes committed abroad when the corresponding result has been produced (or should have been produced) in Brazil.

Once the Brazilian jurisdiction is triggered by a certain conduct, CADE is not prevented from acting simply because the same conduct is under investigation (or has already been sanctioned) by a different foreign authority. Similarly, a decision rendered by a foreign agency dismissing a conduct does not prevent CADE from sanctioning the same conduct under Brazilian law.

That notwithstanding, it is important to observe that the calculation of administrative fines for antitrust violations in Brazil would usually be based on the relevant undertaking’s turnover (or expected turnover) in Brazil. Therefore, this should avoid, in normal situations, bis in idem vis-à-vis other sanctions potentially imposed by foreign jurisdictions. Moreover, as a matter of fact, CADE, which has international co-operation agreements with many foreign antitrust authorities (see 3.5 Co-operation With Foreign Enforcement Agencies), often takes into consideration the results of such concurrent foreign investigations.

Over the past few years, there have been no major overt changes in CADE’s enforcement policies. Cartel enforcement increased substantially in the years following the Brazilian “car wash” investigation (in 2017, for instance, CADE executed 21 leniency agreements and 61 cease-and-desist agreements related to collusive practices, most of them related to the car wash investigation) but these figures have decreased ever since. In 2023, CADE opened twice as many investigations for unilateral conduct as it did for collusive practices. However, this change does not seem to be attributable to an overt change in enforcement policy.

CADE may start an investigation (i) ex officio, (ii) after an anonymous or non-anonymous notice, (iii) based on a formal complaint offered by an interested party, or (iv) following a previously executed leniency agreement. The investigation may involve two preliminary proceedings and one subsequent administrative trial proceeding.

The first preliminary proceeding is called a “preparatory proceeding” and is used to determine whether the subject matter of the investigation falls within CADE’s jurisdiction. The second is an “administrative inquiry”, whose purpose is to investigate the conduct and determine whether sufficient evidence exists to justify a formal administrative indictment. In the context of such administrative inquiry, CADE’s SG may request the court’s authorisation to perform dawn raids and may interact with the police and criminal prosecutors if a parallel criminal investigation is also underway. If CADE finds that sufficient evidence of unlawful conduct exists, it will issue a formal administrative indictment against the involved parties and will initiate an administrative trial proceeding (the “administrative proceeding”) to prosecute the case, giving the interested parties full opportunity for defence.

The administrative proceeding starts before CADE’s SG with a formal indictment describing the potentially illegal conduct and the corresponding supporting facts, the legal qualification of the corresponding violation, and the identity of the individuals and legal entities allegedly responsible for it. Then a formal notification (subpoena) is sent to the interested parties requesting them to attend the case and present their defences.

The parties will have a common timeline of 30 days to present their defences, which only starts running after all of them have been duly served with their corresponding subpoenas. These subpoenas may be served by registered mail, with proof of receipt signed by the investigated individual or entity, through international co-operation mechanisms, or by any other means capable of assuring receipt by the interested party. In some cases involving many individuals residing outside Brazil, it may be particularly difficult to effectively serve subpoenas on all the investigated parties. In those cases, CADE may split the investigation into parallel administrative proceedings, so that one can proceed in relation to the parties already served while the other stays suspended awaiting notification of the other parties.

After the defences are submitted, CADE’s SG will issue a note analysing the preliminary arguments raised by the defendants and will decide on the subsequent production of evidence. During the fact-finding phase, witnesses may be heard, and expert witnesses may present their reports. Documents may be attached to the files at any moment during this phase.

After the conclusion of the fact-finding phase, CADE’s SG will notify the defendants to present their final allegations within five days. After that, it will issue a non-binding opinion recommending the dismissal of the investigation vis-à-vis all or some of the defendants, and/or the conviction of all or some of the defendants. After that, the case will be sent to CADE’s Tribunal, where it will be randomly assigned to a reporting commissioner. The reporting commissioner may determine further investigations and request formal opinions on legal aspects of the investigation to be presented by CADE’s attorney general and by the Federal Prosecutor’s Office.

Once the reporting commissioner is satisfied with the materials presented before him/her, he/she will notify the defendants to present their final arguments and will prepare his/her vote and schedule a date for the matter to be publicly ruled by CADE’s Tribunal. This final ruling can be corrected or complemented based on contradictions or omissions only. On their merits, CADE’s decisions can only be subsequently reviewed by a court of law.

Based on experience, it is reasonable to say that cartel investigations can take as long as four to ten years to be completed (from the beginning of the investigation until a final decision is rendered by CADE’s Tribunal).

CADE’s SG can request scheduled inspections at the investigated undertaking’s facilities, offices or branches, to examine documents, objects, papers of any nature, commercial books, personal notes, computers, phones and personal devices, emails, electronic files, and other materials, and may also request copies of such materials in the context of these inspections. Scheduled inspections are, however, infrequent in practice. Alternatively, it can request a court order to conduct a dawn raid (with no prior notice) of the same facilities, in which case it may, according to the terms of the corresponding judicial authorisation, search and seize the same materials.

If a dawn raid is judicially authorised, CADE’s personnel will conduct it in accordance with the corresponding court order. It may have a civil or criminal nature, depending on whether it is requested to a criminal court, in the context of a joint criminal investigation, or to a civil court, otherwise. After the dawn raid is completed, all seized materials will be locked in sealed boxes and a detailed written record of the act will be executed, listing all the materials that were copied or apprehended, and mentioning who will be responsible for guarding the apprehended materials. A subsequent meeting will be scheduled by CADE to open the sealed boxes in the presence of representatives of the interested parties. Materials found to be relevant to the investigation will be copied, and the originals and remaining materials will be returned to the interested parties. If authorised by the corresponding court order, CADE’s SG may also keep certain materials until a final decision is rendered.

Officers or employees are not required to respond to interviews or substantive questions on the merits of the case during dawn raids (their deposition can only be requested by CADE in the context of a subsequent formal hearing during the fact-finding phase of the administrative proceeding, duly accompanied by counsel). Employees are, however, expected to co-operate with the dawn raid itself. External counsel may be present, and employees are allowed to request their presence during dawn raids, which is strongly recommended. Spontaneously volunteering unsolicited documents or materials is not required by the law. However, concealing, destroying or deleting documents or electronic files is not permitted, and may amount to a separate criminal and administrative violation, potentially triggering even the application of the Brazilian anticorruption legislation (Law No 12.846/2013, Article 5), which could result in additional fines of up to 20% of the relevant undertaking’s gross revenues. If a criminal investigation is also underway, destroying evidence may provide grounds for the provisional arrest of the involved individuals.

Between 2012 and 2018, CADE performed on average 3.3 dawn raids every year. Between 2019 and 2023, this average decreased to about two.

Obstructing an inspection requested by CADE may result in fines of up to BRL400,000, and providing false information or documents may trigger fines of up to BRL5 million. However, even more serious consequences may derive from obstructing a court-ordered dawn raid, or actively destroying relevant evidence, as explained in 2.2 Dawn Raids.

Parties are constitutionally entitled to be assisted by counsel at every step of the investigation and in all interactions with CADE and other administrative or criminal authorities. If the interests of the company and those of their employees are aligned, they may all be represented by the same counsel. Otherwise, ethical, and legal rules would recommend different representation.

Counsels representing one party are allowed to be present during the interviews to be performed with that party, any other party, and any potential witnesses. They can address questions but cannot instruct any party or witness on how to answer a specific question at the hearing.

It is strongly recommended that individuals and undertakings facing an investigation for anticompetitive conduct seek specialised legal representation as early as possible, to make sure that their rights to due process and adequate defence are duly exercised.

CADE typically resorts to documentary evidence, oral statements made by the parties or relevant witnesses during the formal hearings of the case, and economic data to decide on cases involving antitrust violations. Wiretapping is seldom used by CADE and can only be obtained by means of a court order in the context of a criminal investigation. Brazilian law is inconsistent as to the legality of undisclosed recordings of personal conversations.

Documents would be typically obtained by CADE in the context of dawn raids, cease-and-desist agreements, leniency agreements, or specific requests made to the parties. They may be also obtained through co-operation with other Brazilian agencies, or international co-operation with foreign agencies. Investigated parties may submit documents to CADE in the context of their defences. There are no discovery rules in Brazil forcing the investigated parties to make voluntary disclosures to CADE, but CADE can request specific documents and information to individuals, legal entities and government authorities. Judicial assistance may be obtained by CADE if such requests are not complied with, but this is also infrequent.

Oral statements can be produced in the context of leniency agreements, cease-and-desist agreements, or during formal hearings to be held in the fact-finding phase of the investigation in the presence of counsel. Particularly in view of facts that may also constitute criminal offences, there is a general constitutional right in Brazil against self-incrimination. Witnesses and expert witnesses are, however, obligated to tell the truth during their depositions.

Economic evidence may be obtained by means of a request made by CADE’s SG or Tribunal to CADE’s DEE, or even to other governmental bodies and regulatory agencies. Raw data used in the corresponding analysis may be directly requested to the parties, third parties, or other governmental agencies.

Evidence produced by CADE or used as the basis of a conviction must be submitted to the parties for review and rebuttal. Failing to comply with this would result in a violation of due process rights, which could render the final decision null and void.

The investigated parties also have a comprehensive right to produce any kind of legally admissible evidence in their favour. Failing to admit the production of such evidence has already resulted in the annulment of some high-profile cartel decisions issued by CADE before the Brazilian courts.

Within the limits explained above (including a potential right against self-incrimination), a party cannot refuse to comply with CADE’s requests for documents or information simply because the information is located outside Brazil.

Attorney-client privilege is not clearly regulated by statute in Brazil. The main applicable legislation (Law No 8.906/94) formally treats attorney-client privilege as a counsel’s right to refrain from making testimony of facts learned in the context of his/her profession (ie, in the context of a client’s representation), but not as a right that would be explicitly granted to the counsel’s clients themselves. Case law, however, generally grants a wide-ranging protection to attorney-client privilege when it comes to communications held between the parties and external counsels. Privilege of communication with inside counsel is not so well established, nor is work-product privilege once the corresponding documents are in possession of the client and are obtained, for instance, in the context of a dawn raid. Proper constitutional interpretation should construe attorney-client privilege in a much broader manner, and failure to respect such privilege should result in the annulment of CADE’s corresponding decisions. Parties and counsels should object to the seizing and use of privileged information as soon as they learn about it. Provisional measures may be obtained before the courts to prevent CADE from using, getting, or disclosing privileged information.

Failing to comply with CADE’s requests for information may result in fines being imposed on the investigated party of up to BRL5 million, which may be increased by up to 20 times to ensure compliance. This statutory provision should be carefully balanced, however, with the constitutional right against self-incrimination.

Although administrative proceedings are public by nature, confidential information is protected by law and regulation. In particular, CADE’s Resolution No 21/2018 protects the secrecy of the following information, inter alia:

• industrial secrets;
• documents and information related to a party’s business activities which may give a competitive advantage to competitors if made public;
• documents and information protected by confidentiality under specific legislation, such as tax information, financial information, capital markets transactions, information protected by professional secrecy, industrial secrecy and court secrecy; and
• information otherwise protected by court orders.

The following information can also receive confidential treatment under the applicable regulations:

• accounting information;
• information on the economic-financial situation of the company;
• company secrets;
• information on production processes and industry secrets;
• turnovers;
• confidential information related to certain commercial transactions, including dates, value, etc;
• information on customers, suppliers and capacity; and
• information on production costs, R&D, etc.

Such information will receive confidential treatment even if it belongs to third parties not directly involved in the case (but only to the extent that such confidential treatment does not jeopardise the parties’ right to due process of law).

Regulations also provide for the confidential treatment of unsuccessful leniency applications and cease-and-desist proposals, and information provided by leniency applicants which may have a self-incriminating nature (except that such information may be made available to public prosecutors). During the corresponding negotiations, cease-and-desist proposals and leniency applications will also be kept under secrecy. Other information related to the case may be kept confidential during the fact-finding phase of the administrative proceeding (being accessible only to the involved parties) and shall be subsequently disclosed to the public after a final decision is reached by the Administrative Tribunal.

Counsels shall have ample access to the proceedings and to the enforcers during the investigation. They have the right to raise arguments and discuss legal topics with relevant officers. This includes the opportunity to hold meetings with enforcers, present arguments and defences, and file any necessary motions. Counsels also have the right to present oral arguments to CADE’s Tribunal before the final decision on the case is taken. However, once an administrative indictment is formally issued and the corresponding administrative proceeding is open, a decision on the merits dismissing the case in relation to a certain party will only be issued at the end of the case, along with the decision on the merits related to all other parties involved in the investigation. It would be very unlikely for CADE to anticipate judgment and dismiss a case in relation to a certain party only, before the end of the corresponding proceeding in relation to all other parties.

The Brazilian leniency programme dates from 2000. It originally excluded undertakings leading the cartel behaviour, but this restriction was removed in 2011. The programme is currently regulated by the Competition Law, and the competence to negotiate such agreements belongs to CADE’s SG. In 2016, CADE published a specific guideline on leniency applications, aiming to further increase the transparency and predictability of the programme and thus further increase the number of leniency proposals received.

The Brazilian leniency programme currently has the following characteristics:

• It guarantees total immunity to the applicants, protecting them from both administrative and criminal sanctions (including criminal sanctions related to accessory crimes, such as criminal association and bid-rigging).
• It is available to companies and individuals who are willing to report the existence of a cartel, as long as the conduct is not already known to the authorities and that the following requirements are met:
1. the applicants are the first to report that conduct and qualify as whistle-blowers;
2. CADE does not have sufficient evidence to ensure the conviction of the whistle-blowers at the time of the application;
3. the whistle-blowers confess their participation in the conduct and are capable of providing evidence in order to implicate other participants;
4. the whistle-blowers undertake the obligation to continue collaborating during the course of the investigations; and
5. the whistle-blowers undertake the obligation to cease the conduct.
• In cases where CADE is already aware of the conduct and has begun to investigate it (mainly through the opening of a formal administrative proceeding), but does not yet have sufficient evidence to convict the participants, leniency may be partial, resulting in a reduction of one to two-thirds of the applicable penalties.
• When leniency is signed by a legal entity, its effects may be extended to individuals related to the applicant who decide to adhere, simultaneously or subsequently, to the agreement.
• Communication to CADE of the intention to enter into a leniency agreement is made by any means, including oral, and will be formalised by a certificate (marker) issued by CADE, declaring that the proponent was the first to qualify for the conduct in question, recording the object of the proposal and the date and time of its presentation. If, at the time of the proposal, there is another person who already qualifies for leniency, a certificate is issued declaring this circumstance, so that the new applicant may have the right to negotiate leniency if negotiations with the first qualified whistle-blower are unsuccessful.
• Once a leniency agreement has been signed, new collaboration agreements with other participants in the same conduct will only allow for sequentially lower benefits, reducing administrative fines without any criminal impact. The reduction of fines roughly follows the European model: 30% to 50% for the first proponent of an agreement after leniency, 25% to 40% for the second and up to 25% for the others. If one of these proponents also denounces the existence of another cartel, of which CADE has not previously been aware, he or she is guaranteed an additional penalty reduction of up to one-third, in addition to the exemption from the penalty relating to the additional cartel denounced, which will be the object of a separate leniency agreement (leniency plus).
• All stages of the negotiation are confidential. If negotiations are not fruitful, CADE is obliged to return all information and documents received to the proposing party, being prohibited from using them for any purpose. Disclosure of the unsuccessful proposed agreement is prohibited, and the unsuccessful proposal does not imply a confession regarding the facts or unlawful nature of the conduct.

In its 24 years of existence, CADE’s leniency programme has been successful, having generated dozens of agreements and enabled countless convictions. Between 2010 and 2019, CADE executed 85 leniency agreements (an average of 8.5 per year), with a peak of 21 in 2017. A significant number of these cases related to the “Car Wash” investigation, but many others were related to different markets, including cross-border investigations. Between 2020 and 2023 the number of executed leniency agreements decreased significantly, to an average of 2.5 per year. CADE has recently made public, however, that ten new markers were granted in 2023, relating to cases still under negotiation.

Full amnesty is granted to successful leniency applicants only. See 2.11 Leniency and/or Immunity Regime for further details.

Although the Competition Law grants comprehensive powers to CADE to request documents and information from third parties, including individuals, obtaining information directly from employees, outside the formal context of proper hearings in which those individuals might be heard as witnesses or investigated parties, is not very frequent in Brazil. In any case, if such request is made, employees have a right to be assisted and represented by counsel, and rules against self-incrimination might apply. Information concerning employees or information held by employees may be obtained by CADE during dawn raids, which may also take place in the offices or residences of such persons.

Notices of unlawful conduct might be voluntarily offered to CADE by former employees in certain circumstances. These notices can include documents voluntarily disclosed to CADE by such former employees. In addition to that, both current and former employees who were involved in illegal conduct might apply to CADE for leniency, as explained in 2.11 Leniency and/or Immunity Regime, in which case they will be expected to produce evidence and documents in support of their application.

As mentioned, CADE’s powers to request documents and information are broad and may include any company within a certain economic group, as well as third parties.

See 1.6 Extent of Jurisdiction and 3.2 Obtaining Documentary Information From the Target Company. CADE can request information directly to companies or individuals located outside Brazil and, to facilitate this, the Competition Law contains a provision allowing foreign companies to be notified through any agent, representative, office or branch located in Brazil. Any foreign company that operates or has a branch, agency, office, establishment, agent or representative in Brazil is also considered to be domiciled in the national territory for the purposes of the Competition Law.

CADE may send requests to foreign companies or individuals directly, by post or email, but of course actual enforcement may be difficult if the addressee has no connection with the Brazilian jurisdiction. In any case, CADE may request international assistance and co-operation for that purpose, either independently, by means of co-operation agreements with foreign agencies, or with the assistance of the Brazilian Ministry of Justice.

As of 2023, CADE had more than 50 co-operation agreements or memoranda of understandings in place with different agencies and authorities in Brazil, including agreements with the Federal Prosecutor’s Office, with the Prosecutor’s Office before the Brazilian Court of Accounts, the Military Prosecutor’s Office, the Prosecutor’s Offices in all 26 States of Brazil and the Federal District, the Brazilian Central Bank, regulatory agencies responsible for the sectors of aviation, cinema, data protection, oil and gas, healthcare, telecommunications, transports, food and drug administration, mining and intellectual property, the Federal Court of Accounts, etc.

These agreements typically allow for the exchange of information and expertise between CADE and those agencies, or even help regulate the boundaries of their corresponding jurisdictions, as has been the case with the Brazilian Central Bank.

CADE interacts with other agencies in many investigations, particularly when regulated markets are involved. As explained, CADE also has statutory powers to request information from other agencies.

As of 2023, CADE had international co-operation agreements in place with 20 foreign antitrust agencies or international organisations, including the competition authorities of Argentina, Canada, Chile, China, Costa Rica, Europe, India, Italy, Japan, Korea, Mexico, Mozambique, Paraguay, Peru, Portugal, Russia, and the United States (including both the FTC and the DoJ), as well as the World Bank, the Interamerican Development Bank and BRICS. CADE also co-operates frequently with foreign agencies, having shared information on either merger cases or antitrust investigations with many of them. Those co-operation agreements may also facilitate service of process to individuals and legal entities located in foreign jurisdictions.

In some instances, co-operation even resulted in co-ordinated enforcement actions, such as simultaneous dawn raids in Brazil, Europe and the United States.

These agreements usually permit the exchange of non-confidential information, but confidential information may also be exchanged, particularly under a specific waiver granted by the interested parties. In leniency negotiations involving international conduct, waivers of this kind are often requested by CADE.

Criminal cases involving crimes against the economic order are prosecuted by public prosecutors in Brazil. In principle, state prosecutors and state criminal courts have jurisdiction over these cases, but federal courts and federal prosecutors might have jurisdiction if interests or services related to the Federal Union are affected. Law No 10.446/2002 authorises, in any case, the involvement of the Federal Police in the investigation of such cases.

The corresponding investigation is conducted by the state or federal police, under the supervision of the Public Prosecutor’s Office. Once it is completed, the police will issue a report, and the Public Prosecutor’s Office will file the corresponding complaint to the competent criminal court, providing evidence of the crime and its perpetrators. A preliminary defence may be offered by the interested parties and, if the complaint is accepted, full opportunity for defence will follow. The trial is conducted by a criminal judge, who will decide on both matters of law and fact. An appeal is allowed to the state court of appeals and in certain circumstances subsequent appeals may be filed before the Superior Court or Justice or the Brazilian Supreme Court.

Civil actions based on the Competition Law aiming at collecting damages or seeking injunctions to make the illegal conduct stop may be individual lawsuits or class actions. They are typically litigated before state courts.

Historically, civil actions for damages based on antitrust violations have not been very common in Brazil (a study published in 2020 identified less than 70 cases filed between 1995 and 2017, half of them being individual claims and the other half class actions filed by public prosecutors). This could be due to a number of reasons, including the complexity of the Brazilian procedural system governing this kind of action, a certain inefficiency of the Brazilian judiciary when it comes to determining and collecting damages in complex matters, the long time taken from the beginning of the lawsuit until actual collection, problems in accessing evidence (particularly due to the confidentiality of documents – including documents offered by leniency and cease-and-desist agreement applicants – while CADE is investigating the corresponding conduct), complexities involved in the quantification of the damages suffered, etc.

To deal with these issues, Federal Law No 14,470/2022 implemented some important changes, establishing a general right to double compensation to incentive victims to file for damages suffered (successful leniency agreements would protect the corresponding applicants against this rule, and such applicants will only be liable for simple damages). It also established a set of rules according to which (i) passing-on allegations cannot be legally presumed and must be proven by the defendant, (ii) limitation periods do not run for such claims while CADE is investigating the conduct, and (iii) CADE’s final decision may be used to ground provisional measures in the corresponding litigation.

Additionally, CADE published in 2018 a new regulation, determining that information used in cartel convictions should be made available to the public after a final decision is reached (see 2.9 Protection of Confidential/Proprietary Information). Also in 2018, CADE’s DEE published a guideline on the calculation of damages in cartel cases, in part to help establishing a methodology that could be followed by courts in the corresponding civil actions.

The implications of these developments are still not clear. A trend that seems to be developing may be the acquisition of potential claims based on antitrust violations by specialised investment houses, as well as litigation financing. Another trend may be litigation outside Brazil, in which claimants may try to establish jurisdiction abroad by filing the corresponding lawsuits against foreign companies belonging to the same economic group of the Brazilian entity involved in the alleged violation, based on the joint and several liability rules established by the Competition Law.

Individual civil cases in Brazil can be filed by any affected party before a competent lower court, and the corresponding evidence will be produced before that same court (there is no trial by jury in Brazil in civil matters). Technical and economic evidence may be produced, usually by means of written reports prepared by experts appointed by the court, not by the parties. Witnesses may be heard at a final hearing, and documentary evidence is also fully allowed, although there is no discovery process in Brazilian civil litigation. Defendants have unrestricted rights to access and criticise all the evidence produced in such cases against them. Once a final decision is made, an appeal to the corresponding appellate court is allowed, both on matters of fact and law. Subsequent appeals to the Brazilian Superior Court of Justice and to the Brazilian Supreme Court may be also accepted, but only on matters of law.

Class actions for damages would follow a similar procedure, but would usually be brought by public prosecutors representing the affected community. Specific authorisation from class members is not a necessary requirement for class actions in Brazil. If the final decision acknowledges a general right for compensation, interested affected parties may subsequently claim their individual damages through a subsequent process called “liquidation”. If just a small and disproportionate number of victims file for liquidation after one year, the Public Prosecutor’s Office may initiate a process of “fluid recovery” to collect the remaining unclaimed damages to a fund managed by federal or state authorities.

Administrative proceedings involving collusive practices are typically brought in Brazil against all the implicated parties in a single proceeding. The final decision, analysing the case and evidence produced against all the investigated parties, would be typically taken at the same time and would be typically incorporated into the same document or ruling. However, it is mandatory to individually analyse the evidence, participation, and responsibility of each of the defendants, and to consider such individual aspects in the corresponding sanctions applied to each of them.

As mentioned in 2.1 Initial Investigatory Steps, CADE may decide to open separate proceedings or to split an existing proceeding for organisational purposes (which is particularly common in cases involving multiple individuals residing outside Brazil); however, in principle, a party would not be legally entitled to request this separation for their own convenience. Separate proceedings may also be opened when CADE learns about the potential participation of additional parties in a collusive scheme over the course of an existing case and finds it impossible or inconvenient to include such additional parties in the ongoing investigation.

Criminal complaints for cartel violations are also typically filed against all the accused individuals.

CADE has the burden of proving its case against the parties accused of violating the economic order. Similarly, in criminal cases, the Public Prosecutor’s Office has the burden of proving the existence and perpetrators of cartel violations. Specific defences raised by the defendants, such as passing-on defences, efficiency defences (when applicable), etc, must be proven by the defendant that raises them. In civil actions, the same rule applies in principle but, if those cases involve consumers, a court may decide to shift the burden of proof in their favour.

In principle, the Brazilian legal system does not work with the concept of “standard of proof”, but rather relies on a “rational persuasion” rule, also called “free motivated conviction”.

In either criminal, civil or administrative proceedings related to antitrust violations, the authority responsible for the final decision (ie, for the application of the law to the facts) is the same authority responsible for the evaluation of the evidence and for determining the findings of fact applicable to the case. In criminal and civil proceedings, this is the court of law to which the case is assigned. Its findings on facts may be subsequently challenged before an appellate court; in administrative cases, this would be CADE’s Tribunal, whose findings of fact can only be challenged by means of subsequent judicial review (see 4.8 Available Forms of Judicial Review or Appeal).

In Brazil, evidence produced in a case may be used in different cases in many circumstances. If it is a document, it will be simply submitted in the subsequent case as new documentary evidence, and the party against which it is produced will have the opportunity to defend itself and rebut the content of such document (provided that it has been legally obtained). If it is an oral statement (a confession, a statement from a witness, etc), or if it consists of expert evidence, additional requirements will apply. Primarily, these materials must have been produced in a case involving the same party against whom the evidence is expected to be subsequently presented, and such party must have had the opportunity to participate in the production of such evidence, and to defend itself against it, in the original case. In all cases, the evidence must have been legally obtained.

As mentioned, there is no “discovery” process in Brazil, and parties are not obliged to voluntarily disclose all the evidence they possess in relation to the matter under investigation.

Parties in civil cases, and prosecutors in criminal cases, must provide evidence in support of their claims. Courts can, however, determine the production of evidence ex officio, if they find it relevant to their decision.

Oral evidence is usually produced at hearings specially scheduled for that purpose, which usually happens after all relevant written briefs and submissions have been presented by the parties. Presentation of specific documents may be requested and determined by the courts if there is sufficient indication that such documents exist and are in possession of one of the parties in the litigation. CADE’s powers to request documents and information have already been discussed in 2.2 Dawn Raids, 2.5 Enforcement Agency’s Procedure for Obtaining Evidence/Testimony, 3.2 Obtaining Documentary Information From the Target Company, 3.3 Obtaining Information From Entities Located Outside This Jurisdiction, 3.4 Inter-agency Co-operation/Co-ordination and 3.5 Co-operation With Foreign Enforcement Agencies.

Evidence will be admitted to a case in so far as it is relevant and provided it has been legally obtained. As said, evidence will be freely weighted by the decision authority based on criteria such as relevance, credibility, consistency, etc. The are no statutory detailed rules in Brazil governing the specific weight, relevance, and admissibility of specific pieces of evidence in specific circumstances, as exist in other jurisdictions.

If relevant to their case, defendants may present in administrative proceedings expert reports prepared by accountants, economists, engineers, law professors or any other professionals. The same would apply in civil and criminal cases. Before the courts of law, parties may also request the court to appoint an expert to perform a specialised analysis of facts, and are allowed to appoint assistants to follow up the production of such evidence. When CADE itself decides to rely on expert knowledge, it usually simply requests the assistance of the DEE.

See 2.7 Attorney-Client Privilege and 2.9 Protection of Confidential/Proprietary Information.

Since antitrust violations may have different administrative, civil and criminal repercussions, it is possible to have multiple or simultaneous enforcement proceedings involving the same facts running in parallel. Additionally, if the corresponding conduct also involves other interests or authorities (such as regulators, public procurement processes, etc), it is possible to have parallel investigations running before such other authorities, as the Central Bank, regulatory agencies, securities regulators, the Court of Accounts, the Office of the Comptroller General, etc.

See 1.2 Public Enforcement Agencies and Scope of Liabilities, Penalties and Awards and 3.10 Finders of Fact. CADE has the authority to impose sanctions based on the Competition Law directly. Criminal sanctions are imposed by criminal courts.

See 2.11 Leniency and/or Immunity Regime with respect to leniency agreements and cease-and-desist agreements executed after a successful leniency application with respect to the same facts.

Administrative cease-and-desist agreements may be executed by CADE with interested parties at CADE’s discretion. If approved and executed, those agreements will suspend the investigations against the interested party, who, upon complying with the corresponding obligations, which usually include co-operation and refraining from continuing with the investigated practice, will only be subject to the consequences agreed upon in the agreement. In cases involving adjustments among competitors, CADE’s regulations demand that cease-and-desist agreements shall include a recognition of the interested party’s participation in the investigated conduct, a money contribution, and the obligation to co-operate with the investigation.

At the criminal level, non-prosecution agreements may also be executed between the interested parties and the Public Prosecutor’s Office, subject to approval by the corresponding competent court.

If CADE issues an administrative conviction for an antitrust violation, this may include the imposition of fines and, in some cases, direct debarment from public processes. Additionally, by virtue of a recent change in legislation, the corresponding decision may be used by a civil court to justify a summary judgment on the merits of a related damages claim (although the amount and extent of the damages will still need to be proved).

Depending on their specific language and extent, recognitions of participation in illegal conduct made in the context of leniency or cease-and-desist agreements with CADE may be considered by courts in civil and criminal cases as confessions, which might trigger the corresponding consequences.

Finally, criminal convictions for antitrust violations can also have civil effects, directly establishing, for example, a corresponding right for damages (although, again, the amount and extent of such damages will still need to be proved before the civil court). In some very specific cases, a criminal decision can also release the defendant from civil and administrative prosecution, if it clearly establishes that the facts under investigation never happened, or that the investigated party did not participate in such facts.

See 1.2 Public Enforcement Agencies and Scope of Liabilities, Penalties and Awards.

See 1.2 Public Enforcement Agencies and Scope of Liabilities, Penalties and Awards, 1.3 Private Challenges to Cartel Behaviour/Effects and 3.7 Procedure for Issuing Complaints/Indictments in Civil Cases.

Compliance programmes are usually not considered by CADE in the evaluation of sanctions and penalties.

Sanctions imposed by CADE do not include mandatory consumer redress, and this is neither a requirement to enter into leniency agreements or cease-and-desist agreements. However, criminal non-prosecution agreements may include redress as a necessary requirement. See also 4.3 Collateral Effects of Establishing Liability/Responsibility.

Interested parties are constitutionally entitled to challenge CADE’s decisions before the courts of law as part of a broader right to request the judicial review of administrative action in general. This right is usually exercised ex-post (ie, after a final administrative decision is rendered on the merits), but interim decisions may be immediately challenged if necessary (such as decisions on the use of potentially illegal evidence, on the confidentiality of documents and information, etc).

This challenge may be focused on procedural unfairness or on the inadequate use of the agency’s powers or competence. In the Industrial Gases case, for instance, a federal court annulled CADE’s imposition of roughly USD1 billion in fines for alleged cartel offenses by finding that the corresponding evidence would have been illegally obtained. In another case, another cartel conviction was annulled because the court held that CADE would have illegally denied the interested party’s request to produce expert evidence, which the court considered as a violation of its due process rights.

Judicial review may also be directly grounded on the merits of the case (challenging CADE’s evaluation of the facts, assessment of the evidence, or interpretation of the law). In this case, courts may grant a varying level of deference to CADE’s findings and holdings, but case law is not consistent as to the proper level of deference that CADE’s decisions should receive in cartel cases. In many cases, courts have decided to annul decisions rendered by CADE simply because they disagreed with the agency’s substantial assessment of the facts or evidence.

In hard-core cartel cases, subsequent litigation aiming to annul CADE’s decisions before the Brazilian courts is very common.

See 1.2 Public Enforcement Agencies and Scope of Liabilities, Penalties and Awards, 1.3 Private Challenges to Cartel Behaviour/Effects, and 3.7 Procedure for Issuing Complaints/Indictments in Civil Cases.

See 1.2 Public Enforcement Agencies and Scope of Liabilities, Penalties and Awards, 1.3 Private Challenges to Cartel Behaviour/Effects, and 3.7 Procedure for Issuing Complaints/Indictments in Civil Cases.

As mentioned in 3.7 Procedure for Issuing Complaints/Indictments in Civil Cases, civil actions for damages are still incipient in Brazil and case law is far from established or consistent with respect to indirect purchasers and passing-on defences. However, based on recent legislation, it is now statutorily established that passing-on arguments must be proven by the defendant who raises them as a defence.

See 3.11 Use of Evidence Obtained From One Proceeding in Other Proceedings.

Civil litigation involving damages related to cartel conduct is still incipient in Brazil and there is very little incentive for settlement considering the past track record of cases. Full litigation, encompassing all potential appeals and the actual collection of damages, generally takes no less than five years and, under certain circumstances, could extend well beyond ten years.

Brazilian rules of civil procedure establish that the attorneys representing the winning party will be awarded contingent fees payable by the defeated party as a rule. Those fees are equivalent to about 10%–20% of the value of the dispute.

In civil cases, unsuccessful claimants will be ordered to pay the defendants the expenses directly related to the court proceeding (court fees, fees related to court-appointed experts, etc), plus contingent fees (as explained in 5.6 Compensation of Legal Representatives). Other expenses, such as fees directly paid by the defendants to their attorneys out of a private retaining arrangement, are usually not reimbursed.

See 3.7 Procedure for Issuing Complaints/Indictments in Civil Cases.

The OECD has performed a comprehensive peer review of Competition Law enforcement in Brazil in 2019. The corresponding final report contains relevant information about cartel prosecution.

Brazilian authorities have published English translations of some of their guidelines related to cartel enforcement:

• Guidelines on Competition Compliance Programs (2016);
• Guidelines on Cease-and-Desist Agreements for Cartel Cases (2016 – not up to date);
• Guidelines on Private Enforcement for Cartel Damages (2018);
• Guidelines on Fighting Cartels in Public Procurements (2019);
• Guidelines on the Antitrust Leniency Program (2020 – not up to date); and
• Parameters for Summitting Evidence in Leniency Applications (2021).

The following contributions made by CADE to OECD’s discussions might be of interest:

• Using Leniency to Fight Hard Core Cartels – Contribution from Brazil (2009);

• Improving International Co-operation In Cartel Investigations – Contribution from Brazil (2012); and
• Unannounced Inspections in Antitrust Investigations – Contribution from Brazil (2013).
• Use of Markers in Leniency Programs (2014);

• Leniency Programmes in Latin America and the Caribbean – Recent Experiences and Lessons Learned – Contribution from Brazil (2016); and

• Roundtable on Challenges and Co-ordination of Leniency Programs – Note by Brazil (2018);

Finally, English translations of Brazilian legislation and regulation are available here:

• Statutes of CADE; and
• Brazilian Competition Law (not up to date).