Unilateral conduct in digital markets a priority for CADE Superintendent Cordeiro

Unilateral conduct will continue to be a priority for the Brazilian competition authority's investigatory unit for the next two years, the agency's top investigator told MLex in a recent interview, citing a probe into Google's alleged uses of mobile-device operating system Android as one of the agency's most important cases involving digital markets.

Last October, Alexandre Cordeiro was approved by the Brazilian Senate to lead the investigatory unit of the Administrative Council for Economic Defense, or CADE, for two more years. Since October 2017, when he assumed control of the Superintendence, his unit has been more focused on unilateral conduct investigations than cartels.

In the past, CADE dedicated much more of its time to cartel investigations, but the numbers of cartel and conduct probes have been converging.

"Unilateral conduct remains a priority for the next two years, and the digital economy will remain a concern for us," Cordeiro said.

"The Google Android investigation in Brazil is still preliminary but a very important case for us," he said, adding, "We decided to open this probe because there are indications of anticompetitive conduct by the company in national territory. We are now in the process of gathering evidence."

"I must highlight, though, that international cases that we decide to investigate locally aren't tied to decisions taken in other jurisdictions," Cordeiro said, referring to the European Commission's decision to fine Google 4.34 billion euros ($4.79 billion) in 2018. "We are analyzing the impact of the alleged conduct only on the Brazilian market," he said.

Cordeiro cited a credit-card probe into discrimination by banks against fintech Nubank and a probe into bank Bradesco's practice of hindering fintech GuiaBolso's access to records from Bradesco clients as two other priority conduct cases at his agency.

Cordeiro said conduct probes won't necessarily result in fines as often as cartel cases, because it's harder to prove that unilateral conduct is anticompetitive, but it's still crucial that CADE keep a close eye on these cases to gradually build a body of case law and also follow action by major authorities in other jurisdictions.

On the cartel side, Cordeiro said the Superintendence this year will conclude "some" of its Operation Car Wash probes into contracts with Petrobras, which will be sent to the agency's governing Tribunal for a definitive ruling.

Most of those cases are expected to end in settlement agreements, but they still must go through the Tribunal, which will decide whether to approve the settlements negotiated by the Superintendence.

The Superintendence will also conclude investigations of cartel cases involving "strategic sectors of the Brazilian economy," he said, without citing specific cases.

"We will invest more resources in cartel investigations this year. We expect an increase in the number of leniency agreements and in the number of cases opened and concluded in 2020," Cordeiro said.

From January through November 2019, CADE's Superintendence signed nine leniency agreements — the agreements available for the first party that settles a particular case — and opened 12 cartel probes.