{"id":92739,"date":"2025-01-30T16:03:31","date_gmt":"2025-01-30T19:03:31","guid":{"rendered":"https:\/\/murray.adv.br\/?p=92739"},"modified":"2025-01-30T16:03:33","modified_gmt":"2025-01-30T19:03:33","slug":"mandatory-merger-notification-to-antitrust-watchdog-could-change","status":"publish","type":"post","link":"https:\/\/murray.adv.br\/en\/mandatory-merger-notification-to-antitrust-watchdog-could-change\/","title":{"rendered":"Mandatory merger notification to antitrust watchdog could change"},"content":{"rendered":"\n
Administrative rule likely to update corporate revenue thresholds<\/em><\/strong><\/h6>\n\n\n\n

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01\/30\/2025 <\/p>\n\n\n\n

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Brazil\u2019s Ministry of Finance and Ministry of Justice and Public Security are expected to update soon the revenue thresholds that require companies to notify the antitrust watchdog named Administrative Council for Economic Defense (CADE) of mergers and acquisitions. Under Brazil\u2019s antitrust legislation, companies are currently required to report deals if the parties involved posted revenues of at least R$750 million (one of the parties) and R$75 million (the other party) in the previous year. According to people familiar with the discussions, these thresholds will likely increase to R$1 billion and R$200 million\u2014or maybe more.<\/p>\n\n\n\n

According to sources, the update would be implemented through an administrative rule by both ministries and is primarily aimed at easing the workload of CADE\u2019s General Superintendence\u2014the division overseeing the initial review of mergers and acquisitions. That would allow more personnel to focus on regulating and overseeing big tech companies from a competition perspective, as part of a government proposal currently being drafted by the ministries to be sent to Congress soon.<\/p>\n\n\n\n

According to government sources, this update could reduce the number of mergers requiring notification to the antitrust watchdog by about one-third, lowering the caseload.<\/p>\n\n\n\n

The antitrust legislation (Law No. 12,529), enacted in 2011, originally set the revenue thresholds for mandatory notification at R$400 million for one party and R$30 million for the other. In 2012, the ministries of Finance and Justice raised these figures to the current R$750 million and R$75 million, respectively. Since then, no further adjustments have been made, despite inflation during the period.<\/p>\n\n\n\n

Experts argue that the outdated figures have led to record-high caseloads at CADE, straining its lean staff. Additionally, companies have long called for an adjustment in the required threshold, as exemption from mandatory notifications would reduce legal costs.<\/p>\n\n\n\n

In 2024, CADE data showed that 712 deals were reported, nearly 20% more than the previous year. In recent years, the antitrust regulator has sought ways to expedite reviews, including through artificial intelligence. The average processing time for standard cases dropped from 117 days in 2023 to 93.9 days last year.<\/p>\n\n\n\n

A 2023 study by the Antitrust Research Group and the Center for Economic Freedom at Mackenzie Presbyterian University found that, based on the General Market Price Index (IGP-M), the revenue thresholds should be raised to R$1.7 billion and R$170 million.<\/p>\n\n\n\n

According to Vicente Bagnoli, an antitrust law professor at Mackenzie and one of the study\u2019s authors, the research concluded that most merger cases submitted to the regulator appear unnecessary. He noted that many deals are reported only due to outdated revenue thresholds rather than for posing a real risk of market concentration.<\/p>\n\n\n\n

\u201cOutdated thresholds contradict the spirit of the law,\u201d Mr. Bagnoli said. He argued that adjusting the figures would allow the antitrust regulator to \u201coptimize its resources, dedicating more time and personnel to expediting investigations into anticompetitive practices, such as cartelization and abuse of dominant position.\u201d<\/p>\n\n\n\n

Paola Pugliese, a partner at Lefosse Advogados and chair of the Competition Commission at the International Chamber of Commerce (ICC), said the update is widely welcomed by the market. \u201cBecause the current criteria have been in place since 2012 with no inflation adjustment, they now capture many more cases than when first established,\u201d she noted.<\/p>\n\n\n\n

Within CADE, opinions on the matter are divided. In early 2024, CADE President Alexandre Cordeiro suggested in an interview with Valor that other notification criteria should be modified instead of simply increasing the revenue thresholds.<\/p>\n\n\n\n

\u201cThe push to update these figures seems driven by a desire to avoid notifications. Shouldn\u2019t the goal be the opposite? Analyzing more cases would build a more comprehensive database and provide deeper insights into market dynamics. Is the antitrust regulator willing to forgo access to more data?\u201d Mr. Cordeiro questioned at the time. \u201cA key discussion point is whether we need to refine the criteria\u2014perhaps using deal value alongside revenue thresholds.\u201d<\/p>\n\n\n\n

Some experts opposing the update warn that it could enable large corporations to acquire regional companies and expand their market power without the antitrust watchdog\u2019s scrutiny.<\/p>\n\n\n\n

\u201cIt\u2019s questionable whether the update would weaken enforcement,\u201d Ms. Pugliese countered. \u201cStatistically, the vast majority of cases have low competitive significance.\u201d She added that deals with a real impact on competition are unlikely to go unnoticed by CADE, which retains the legal authority to require notification even when a deal falls below the established thresholds.<\/p>\n\n\n\n

Eric Hadmann Jasper, a partner at HD Advogados and an expert in antitrust legislation, echoed this view. \u201cUpdating the revenue thresholds makes a lot of sense,\u201d he said. \u201cIt would be a simple way to free up internal resources for investigating unilateral conduct, particularly in digital markets, which are complex.\u201d<\/p>\n\n\n\n

Mr. Jasper emphasized that the antitrust regulator would still have mechanisms to detect problematic mergers, as competitors can file complaints with the agency. \u201cIt just requires vigilance, monitoring, and educational campaigns,\u201d he noted.<\/p>\n\n\n\n

CADE, the Ministry of Finance, and the Ministry of Justice and Public Security did not respond to requests for comment.<\/p>\n\n\n\n

*By\u00a0Guilherme Pimenta – Bras\u00edlia<\/p>\n\n\n\n

Source: Valor International<\/p>\n\n\n\n

\nhttps:\/\/valorinternational.globo.com\/\n<\/div><\/figure>\n","protected":false},"excerpt":{"rendered":"

Administrative rule likely to update corporate revenue thresholds 01\/30\/2025 Brazil\u2019s Ministry of Finance and Ministry of Justice and Public Security are expected to update soon the revenue thresholds that require companies to notify the antitrust watchdog named Administrative Council for Economic Defense (CADE) of mergers and acquisitions. Under Brazil\u2019s antitrust legislation, companies are currently required […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[8106],"tags":[19025,25835],"class_list":["post-92739","post","type-post","status-publish","format-standard","hentry","category-murray-news","tag-antitrust-watchdog","tag-mandatory-merger-notification"],"yoast_head":"\nMandatory merger notification to antitrust watchdog could change - Murray Advogados<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/murray.adv.br\/en\/mandatory-merger-notification-to-antitrust-watchdog-could-change\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Mandatory merger notification to antitrust watchdog could change - Murray Advogados\" \/>\n<meta property=\"og:description\" content=\"Administrative rule likely to update corporate revenue thresholds 01\/30\/2025 Brazil\u2019s Ministry of Finance and Ministry of Justice and Public Security are expected to update soon the revenue thresholds that require companies to notify the antitrust watchdog named Administrative Council for Economic Defense (CADE) of mergers and acquisitions. 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