Brazil’s CADE fines six cement companies US$1.4bn for price-fixing

Brazil’s CADE fines six cement companies US$1.4bn for price-fixing
29 May 2014

Brazil’s antimonopoly authority CAD has fined six cement companies a total fine of BRL3.1bn (US$1.4bn) for fixing market prices.

Votorantim Cimentos SA , Camargo Correa-owned Intercement Brasil, ITAB Agro Industrial SA and Cia Cements Itambé SA, Holcim and Cimpor agreed to fix prices to eliminate market competitors, said CADE in a10-hour hearing.  Votorantim has been ordered to pay BRL1.5bn, Holcim BRL508m, Itabira BRL411m, Cimpor BRL297m and Intercement Brasil BRL241m.

CADE has also ordered the company to reduce their capacity by 20 per cent in large markets and terminate cross-shareholdings.

The antitrust watchdog also imposed sanctions on ABESCO, a group representing concrete producers as well as Brazilian cement associations ABCP and SNIC.

“The cartel was that strong that it had clear strategic objectives,” said Márcio de Oliveira Junior, CADE counsel. The six companies controlled around three-quarters of the domestic cement and concrete market.

The verdict follows an eight-year investigation into cost excesses that have plagued the preparations of the FIFA World Cup to be held in Brazil in June and July.

The cement companies have decided to appeal against the verdict, hence litigation is expected to continue for some years yet.

Published under Cement News