Brazil: Cade issues fines of US$934m

Brazil: Cade issues fines of US$934m

Brazil's antitrust watchdog, Cade, has ordered six cement makers named in a price-rigging case to pay a combined BRL3.1bn (US$934m) in fines within a month in a landmark decision that also orders asset disposals.

Under terms of the ruling, Votorantim must pay BRL1.5bn in fines and Cimpor BRL297m. Cade fined Intercement Brasil BRL241m and Itabira BRL411m. Holcim's fine amounts to BRL508m and Itambé is required to pay BRL88m.

The decision announced on Wednesday gives the companies a one-year deadline to reduce their installed capacity in the cement and concrete industries through asset sales. The decision was published in the government's official gazette.

According to Cade, which first issued a ruling in the case in May of last year, Votorantim Cimentos SA, Camargo Correa SA’s Intercement Brasil subsidiary, Itabira Agro Industrial SA and Cia de Cimentos Itambé SA, as well as Holcim Ltd and Cimpor colluded on pricing to force rivals out of the market.

The ruling followed an eight-year inquiry on the period between the 1990s and 2000s. The firms named in the case control about three-quarters of the domestic market for cement and concrete. The number of cement producers in Brazil shrank to about 10 in 2011 from almost two dozen in the early 1990s.

Cade also imposed sanctions on Abesc, an industry group representing concrete producers; Brazil's Portland cement association, ABCP,  and SNIC, which represents local cement factories.