Cade does not recognize MPF appeal and the acquisition of Embraer by Boeing is approved
Merger and acquisition
The tribunal of the Administrative Council for Economic Defense (CADE) has filed the appeal by MPF that questioned the approval of the acquisition involving Boeing and Embraer by the General Superintendence of CADE. The approval of the acquisition by the agency is therefore final.
In a hearing session this Wednesday, 19 Feb 2020, the tribunal decided against the appeal as it concluded MPF do not have competence to appeal CADE’s decisions regarding mergers and acquisitions.
“Despite the relevance of MPF to the legal system of Brazil, the legislative bodies have deliberated and expressly determined the Prosecution Services are vetoed from interfering in mergers and acquisitions analyzed by CADE. That is in perfect consonance with the constitutional provisions indicated and with Supplementary Law 75/1993, since according to section 9, article 129 of the Federal Constitution of Brazil, the Federal Prosecution Services are not assigned the power to act in cases of mergers and acquisitions,” pondered the Comissioner rapporteur Luiz Hoffmann.
According to competition law, every decision by the General Superintendence of CADE approving a merger or acquisition with no restrictions may be reconsidered by the Tribunal, or reanalyzed through an appeal by interested third parties, within 15 days. In such cases, Commissioners individually analyze the Superintendence’s ruling and decide if it is necessary to reopen the case.
The General Superintendence of CADE approved the acquisition of Embraer by Boeing on 27 Jan 2020. After analyzing the case, the agency concluded the companies do not compete in the same markets and therefore the purchase presents no competitive issues.
Cade has also determined the transaction will benefit Embraer which will become a strategic partner of Boeing Thus, the sectors retained by Embraer - executive aviation and defense - will be provided with greater technological and commercial cooperation from Boeing.