Brazil’s antitrust regulator, the Administrative Council for Economic Defense (Cade), ruled an order including fines against six Brazilian cement producers for a total of $1.4 billion (BRL 3.1 million) as part of a cartel case.
Cade imposed a $700.7 million (BRL 1.56 billion) fine on Brazil’s Votorantim Cimentos and a $229 million (BRL 508 million) fine on Holcim (Brasil) S.A. Itabira Agro Industrial is fined $184.9 million (BRL 411.6 million); Cimpor Cimentos Brasil, $133.8 million (BRL 297.8 million); InterCement Brasil (a subsidiary of Camargo Correa Group), $108.6 million (BRL 241.7 million); and Itambe, $39.5 million (BRL 88 million).
The order relates to the competition law proceedings started in 2006, which aimed at investigating the conduct of several of the leading cement producers in Brazil. According to Cade, the companies – who control about three-quarters of the domestic market for cement and concrete – set prices to force rivals from the market as well as fixed the total amount of cement and concrete to be sold by each company.
Cade did not accept the companies’ claims that there was no evidence of price-rigging and ordered them to cut installed capacity in concrete services by 20 percent in large markets. The ruling also requires the companies to do away with any cross shareholdings. “This cartel was so strong that it had clear strategic goals,” councilor Márcio de Oliveira Junior said.
The companies said, in separate press releases, that they would appeal the decision.
According to a statement released by Holcim, “In the context of the proceeding, Holcim Brazil has always supplied all information requested. The company reinforces that it acts lawfully and in accordance with fair competition rules and practices. Holcim Brazil will pursue all available legal steps to defend its position.”
Votorantim said it would challenge the decision “because it is unjustified, lacks legal basis and ignores market facts.” Cimpor also said it would appeal against the ruling, under which it would have to sell 20 percent of its concrete-making assets in Brazil.