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CADE authorizes signature of judicial agreement with Ambev

Judicial Deal

Company will collect BRL 229.1 million in pecuniary contribution
published: Jul 14, 2015 03:00 PM last modified: Apr 15, 2016 04:42 PM

The Tribunal of the Administrative Council for Economic Defense (CADE) approved, on 14 July 2014, a request for judicial agreement presented by Ambev S/A. The company filed lawsuits before the Brazilian Judiciary appealing against the penalties imposed after its condemnation by CADE in August of 2009.

Ambev was condemned by CADE for exclusivity requirement practices in the Administrative Proceeding no. 08012.003805/2004-10. The company used the “Tô Contigo” loyalty program in order to offer discounts and rewards to sales points in exchange for exclusivity or reduction in the sales of products of competitors. CADE’s Tribunal, then, decided that the program should be terminated and imposed fines of almost BRL 353 million, among other penalties.

Besides terminating the program, Ambev committed to collect BRL 229.1 million in pecuniary contribution by the judicial agreement. The publication, by the company, of a release to the market informing about the terms of the agreement signed with Cade is also foreseen.

For the President of CADE, Vinicius Marques de Carvalho, the agreement fulfills the agency’s decision before a judicial decision is rendered. “It is a historical agreement for the defense of competition in Brazil, which enabled the fulfillment of CADE’s decision and will spillover to eventual judicial agreements”, said Carvalho.

According to CADE’s Chief Attorney, Victor Rufino, the pecuniary contribution established is the biggest sanction applied and fulfilled in the history of CADE. “It is a considerable amount for a unilateral conduct and the judicial agreement results in substantial recognition of the authority of CADE’s decision by Ambev”, said Rufino.

The Administrative Proceeding against Ambev was opened by the former Secretariat of Economic Law of the Ministry of Justice in 2004 after a complaint presented by the competitor Primo Schincariol Indústria de Cervejas e Refrigerantes S/A.