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CADE’s General Superintendence recommended the condemnation of companies for cartel in the building maintenance services market

Cartel

The irregularities would have occurred, at least, between 2000 and 2006
by published: Jan 24, 2017 05:19 PM last modified: Jan 24, 2017 05:19 PM

The General Superintendence of the Administrative Council of Economic Defense - CADE issued an official opinion, published in the Federal Official Gazette on January 17, recommending the condemnation for cartel formation of seven companies of building maintenance services. The anticompetitive conduct affected the public and private sectors and would have occurred, at least, between 2000 and 2006.

 The Administrative Proceeding n° 08012.006130/2006-22 has been initiated in 2006 after a search and seizure operation in the offices of the investigated companies. The documents collected and the evidence produced during the procedural instruction revealed that the parties held meetings in order to define prices and to divide amongst themselves the public and private bids for hiring services of building maintenance.

 Based on that evidence, the General Superintendence recommended the condemnation of the following companies for cartel formation: Álamo Engenharia S/A, Araújo Abreu Engenharia S/A, Eletrodata Instalações e Serviços Ltda., Projetos Engenharia, Comércio e Montagens Ltda., MZE – Moreira Zappa Engenharia Energia Climatização e Redes Ltda. (current denomination of RMZ Engenharia Elétrica Ltda.), Wechsel Ltda. and WH Engenharia RJ Ltda. Regarding the defendants Emerson Sistemas de Energia Ltda, and four of its employees, the General Superintendence recommended the closing of the investigation.

The Administrative Proceeding will be judged now by CADE’s Tribunal, responsible for issuing the final decision. If the companies are condemned, they may have to pay a fine reaching up to 20% of the gross revenues in the year preceding the beginning of the proceeding.

Agreement

On October 2016, the Conbras Serviços Técnicos de Suporte S/A and 11 employees and former employees of the company signed a Cease and Desist Agreement (TCC in its acronym in Portuguese) with CADE and committed themselves to collect BRL 9,3 million in pecuniary contribution to the Fund for the Defense of Diffused Rights (FDD for its acronym in Portuguese). 

According to the TCC, negotiated by the General Superintendence, the company admitted the participation in the irregularity and committed to cease the practice and to help clear the situation. As a consequence of the deal, the General Superintendence recommend to CADE’s Tribunal the filling of the Administrative Proceeding regarding the company and its employees.