Brazil’s antitrust authority imposes fines and sanctions on cement industry
Published by Katherine Guenioui,
The Brazilian cartel case reported on worldcement.com in January has been concluded with antitrust authority Cade issuing R$3.1 billion (US$1.4 billion) in fines and ordering companies to dispose of assets.
Cade found that Votorantim Cimentos SA, Intercement Brasil (belonging to Camargo Correa SE), Itabira Agro Industrial SA, Cia de Cimentos Itambé SA, Holcim Brazil and Cimpor Cimentos de Portugal are guilty of price-fixing to keep competitors out of the market – a charge the companies strongly deny. The fines have been issued as follows:
Votorantim – R$1.5 billion
Intercement Brasil – R$241 million
Itabira Agro Industrial – R$411 million
Cia de Cimentos Itambé – R$88 million
Holcim – R$508 million
Cimpor – R$297 million
Cade accuses the companies of costing the country R$1.4 billion pa by controlling more than 85% of the cement market, controlling prices and hindering competition.
In addition to the fines, Cade has ordered the companies to cut installed capacity in concrete-services by 20% in large markets and to shed any cross shareholdings. This is less harsh than had been suggested in January, when 22 – 35% asset shedding had been proposed.
The cartel inquiry has been going on for eight years, and appeals could stretch on for years to come. Votorantim has already said it will challenge the decision, which it says lacks legal basis. Holcim has also stated that it will pursue all available legal steps to defend itself.
Sanctions have also been imposed on both ABCP and SNIC, groups representing the Brazilian cement industry.
Lafarge has operations in Brazil but wasn’t included in the group because it reached an earlier agreement with Cade in 2007, paying R$43 million and agreeing to cease anti-competitive practices. Lafarge is in the process of merging its international operations with Holcim.
Edited from various sources by Katherine Guenioui
Read the article online at: https://www.worldcement.com/the-americas/29052014/companies_fined_in_brazil_cement_cartel_case_266/
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