The Administrative Council for Economic Defense (CADE) has sanctioned (13 December) Ciemarsal, a company operating in Brazil’s sea salt market, for participating in a cartel that manipulated prices and market conditions for decades. During its 241st Ordinary Session of Judgment, CADE ordered the company to pay R$1,592,479.91 (USD 250,000) in fines.
Long-Running Cartel Discovered
The investigation, launched in January 2019, uncovered evidence of cartel activities spanning from 1992 to 2012. Ciemarsal, along with other companies, engaged in price-fixing, market division, and coordinated advantages in public bids. The cartel’s operations were facilitated by industry associations and unions, including Siesal, Simorsal, and Abersal, which played active roles in organizing and enforcing collusion.
Key findings included:
- Regular meetings to set prices and control supply.
- Adoption of price tables encouraged by trade groups.
- Strategic measures, such as the purchase of salt production in specific regions, to control market dynamics and suppress competition.
- Enforcement mechanisms, including supply suspensions, boycotts, and financial penalties for non-compliance with cartel agreements.
Evidence of Collusion
Counselor Diogo Thomson, the case rapporteur, presented extensive evidence, including meeting minutes, emails, and monitoring reports. These documents detailed coordinated efforts to maintain cartel agreements and strategic actions to influence pricing. Communications from Siesal revealed joint negotiations accepted by the cartel participants, including Ciemarsal.
Impact and Penalties
The cartel’s activities affected the entire Brazilian salt production chain, restricting competition and manipulating prices for nearly 20 years. CADE’s ruling reflects its commitment to addressing anti-competitive practices and safeguarding market integrity.
Broader Implications
The unanimous decision by CADE highlights the severity of “hard-core” cartel behavior, which poses significant harm to markets and consumers. In addition to the fine, the case underscores the need for continued vigilance and enforcement to deter future collusive practices in Brazil’s industries.
