Mario Sergio Rocha Gordilho Jr., Carlos Ragazzo, Aug 26, 2013
On November 30, 2011, after a lot of debate in Congress, Brazil’s President sanctioned the approval of a new Competition Law (Law 12.529/11). After the six-month vacatio legis that aimed to give the authorities time to prepare the new competition policy system, the law came into force on the May 29, 2012, bringing about substantial innovations to the national antitrust scenario, especially regarding mergers. Brazil had been one of the very few countries in the world that reviewed mergers only after they were consummated. After the Law was issued, however, merger control started to be reviewed ex ante, following the international trend.
With the new Law, the following challenge was set for Brazil’s antitrust authority: Structure the new infralegal framework and the new administrative structure of the agency in a way that would make the new system more efficient and able to benefit from these advantages. And accompanying this challenge during the transition period was, without doubt, a generalized feeling of uncertainty by the private sector, especially economists and lawyers who deal with antitrust issues in Brazil. For this reason, a swift and efficient response from the new CADE was necessary to calm the general agitation and, ultimately, neutralize the feeling of insecurity that reigned over the new Brazilian antitrust model, especially in merger review.
This article focuses its attention on the creation of a merger-screening sector (the Premerger Notification Unit) that proved to be essential to the new CADE’s initial success in its challenge to create a modern, efficient, and effective antitrust agency for Brazilian society. Since the new Competition Law came into effect in May 2012, the Premerger Notification Unit has gone through four well-defined moments, and the details of each of them will be the objective of this article.
The first moment was the creation of a new merger review model; the second moment occurred when, just as it was beginning to function, the competition authority had to deal with 140 mergers that were submitted under the previous Law (and 40 others inherited without review from the previous antitrust competition bodies); the third moment concerned the consolidation of the pre-merger review; and, finally, the fourth moment, occurring presently, is the reorganization of the Premerger Notification Unit with the aim of becoming the center of intelligence of the Superintendence going forward, as well as preparing it for other functions.
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