CADE, the Federal Police and the Federal Public Prosecution Service of the Federal District and Territories (MPDFT) conduct second phase of Dubai Operation
Operation investigates alleged fuel cartel in the Federal District
On 6 May 2016, the Administrative Council for Economic Defense – CADE, jointly with the Federal Police and the Group of Fight against Organized Crime of the Public Prosecution Service of the Federal District and Territories (GAECO-MPDFT in its acronym in Portuguese), conducts the execution of four search and seize warrants in residences of four individuals, among managers and owners of fuel station networks involved in an alleged cartel in market of fuels in the Federal District.
In total, 10 civil servants of CADE, 16 Federal Police Officers, and 8 Public Prosecutors participate in the second phase of the so-called Dubai Operation. The warrants are being executed in Brasilia. Besides the search and seize warrants, four coercive bench warrants are being executed.
The action stems from the continuation of the investigations after the launching of the Dubai Operation in 24 November 2015, which collected new evidence demonstrating that the involved individuals, owners and employees of the retail and distribution markets of fuels, hold meetings and frequent contact, aiming at fixing uniform prices, with high profit margins, harming competition and consumers in the Federal District. The new evidence allowed to identify the participation of other economic groups that have been not targeted by the first phase of the Operation. These groups held frequent relationships with the other investigated retailers and distributors, which motivated the conduction of a new dawn raid.
The Operation results from the proactive work of investigation bodies aiming at reestablishing fair competition in the market of fuels in the Federal District. In addition to the operations, other criminal and administrative measures have been adopted, such as the preventive measure recently imposed by CADE to Cascol, which established the nomination of a provisional manager to independently administrate fuel stations of the group.
The material seized will be shared with CADE and, jointly with the other evidence collected, will be attached to the ongoing proceeding at CADE’s General Superintendence. The evidence will be object of an administrative proceeding that, after the phases of contradictory and full defense, will receive a technical opinion from the General Superintendence, either for the condemnation or the closing of the case, regarding the companies and individuals that may be indicted.
The final judgment in the administrative sphere is a competence of CADE’s Tribunal, which can fine the condemned companies in up to 20% of their turnover. The individuals and the worker’s union involved, if condemned, can be fined from BRL 50,000 to BRL 2 billion. The Tribunal can also adopt other measures that it deems appropriate to deter the conduct.
More details about the operation will be given in the press conference to be held in the headquarters of the Regional Superintendence of Federal Police Department in the Federal District, starting at 11 am.