Amadeu Ribeiro, Michelle Machado, Paula Camara and Ana Paula Tavassi, Mattos Filho, Veiga Filho, Marrey Jr e Quiroga Advogados

This is an extract from the second edition of the E-Commerce Competition Enforcement Guide - published by Global Competition Review. The whole publication is available here.

E-commerce, digital economy and CADE’s merger review

The traditional phases of merger review in Brazil

The Brazilian Competition Law (BCL), Law No. 12,529 of 2011, is the main competition legislation in Brazil. It establishes (among other things) the structure of the Brazilian antitrust system; the criteria for merger filing and the main rules regarding merger review; and the principles for the analysis of conduct cases in Brazil.

According to the BCL, a transaction is subject to mandatory notification with CADE whenever the following criteria are met: (1) the transaction has effects in Brazil; (2) the transaction is an economic concentration; and (3) the revenues of the groups involved exceed the ­thresholds provided by law. Under the third criterion, a given transaction will be subject to mandatory filing with CADE when at least one of the groups involved (seller or buyer) registered gross revenues in Brazil in excess of 750 million reais (US$200 million) and at least one of the other groups involved registered gross revenues in Brazil in excess of 75 million reais (US$20 million) in the previous fiscal year.

According to the BCL, mergers that result in the elimination of competition, create or strengthen a dominant position, or could result in the domination of the relevant market of goods or services should be blocked by CADE. In practice, the Brazilian authorities tend to apply the dominant position test and to deepen the analysis of transactions that result in combined market shares of more than 20 per cent in a given relevant market.

As provided in CADE’s horizontal merger guidelines, CADE’s merger analysis begins with the relevant market definition (for which different price-related tests may be applied, such as the SSNIP test). Once the relevant market is defined, CADE determines the level of concentration in the market, typically using the Herfindahl-Hirschman index. The next steps are the analysis of barriers to entry and the level of rivalry in the market, for which CADE indicates several competitive variables – such as the variation of market shares over time, price elasticity, price dispersion and economies of scale, among others. Possible coordinated effects and efficiency gains’ analyses are the last steps of the typical merger review.

How is the digital economy changing merger review?

E-commerce and digital-driven markets (as well as technology markets in general) pose several challenges to the traditional antitrust review described above. New business models, such as multisided platforms, shift the analyses from a product-driven, price-and-quantity-based assessment, to a service-driven and frequently zero-priced one. In digital markets in which, for instance, products may be offered free of charge in one side of the online platform and capacity is not a driver, the competition authorities have indicated that basic merger control concepts, such as mandatory filing thresholds, relevant market definition and market power, may have to be revisited.

E-commerce, digital markets and relevant market definition

CADE has analysed a number of merger cases involving e-commerce, online platforms and technology markets. In most cases, CADE carried out a traditional assessment, following the regular steps of the typical merger analysis, as described above. For the purpose of this chapter, we have limited our research to the cases analysed after the entry into force of the BCL in 2012. In respect of e-commerce in particular, we have found 22 merger cases. We also discuss below CADE’s main decisions involving digital platforms and marketplaces.

In respect of the relevant market definition in e-commerce cases, most of CADE’s decisions have segmented the retail market per sales channel (i.e., online sales and physical store sales, separately). However, in particular cases, CADE has already placed both online and offline sales channels under the same relevant market, depending on the characteristics of the product or service under analysis. Moreover, with regards to online sales specifically, CADE has considered marketplaces within the e-commerce category, without further distinctions. 

As to the mix of products offered by the retailer, most of CADE’s decisions segmented the market by product category. In only a few decisions, the online retail market was analysed as a whole, without further segmentation by product mix (all of which raised competition concerns that were mainly related to the vertical integration between e-commerce and logistics services), or as an alternative conservative approach to the analysis, as in Magazine Luiza/NS2, in which the broader scenario was the only one in which the parties’ activities overlapped.

Although CADE’s analyses on e-commerce cases have not differed significantly from those carried out in the context of other ‘regular’ markets (including the tests for the relevant market definition), in recent cases involving platforms and marketplaces, CADE has begun taking into account the specific nature of the ever-changing digital economy and the challenges it imposes on competition authorities and practitioners.

For instance, in Naspers/Delivery Hero, CADE expressed the idea that the traditional phases of the antitrust analysis do not necessarily apply to markets that are technology-intensive. It defined the relevant market as ‘online food ordering’, comprising three different business models: marketplaces, logistic specialists and dedicated platforms. When defining the relevant market, CADE took into account the two-sided nature of the market: on one side, customers that use the platform to order food online; on the other side, restaurants that offer food through the platform – both sides being interdependent. In the end, CADE considered that agents in all three different business models were part of the same market.

CADE has also recognised, in Nasper/Delivery Hero, that the boundaries of relevant markets are not well defined in innovation-intensive markets. For instance, CADE’s General Superintendence (GS) concluded that Delivery Hero was not a close competitor to iFood (Naspers) and that the competitor Uber Eats, despite having a distinct business model, would exercise a higher competitive pressure. CADE also mentioned that Uber Eats’ recent entry in the Brazilian market would create an expectation of intensification of rivalry in the market as a whole. In Multiplan/Delivery Center, the GS confirmed this view and considered online platforms with different business models (i.e., marketplaces, platforms dedicated to food ordering only and logistics specialists), as competitors in the online food ordering market, confirming such interpretation.

The challenge to define dynamic and flexible markets has also been acknowledged by the GS in Mosaico/Buscapé, in which CADE emphasised the fast-paced changing technologies and services of online markets. On such occasion, CADE decided to analyse two different market scenarios: the Brazilian online advertisement market, from the advertisers’ perspective, and the Brazilian market for online search and price comparison, from the customers’ perspective. In both scenarios, CADE considered Google, social networks, marketplaces and price comparison websites as part of the same market.

In another recent case (Itaú/XP), CADE again dealt with issues involving relevant market definition in multisided markets. Although, under a traditional relevant market definition, the case would result in moderate to low market shares in the market for institutional brokerage and asset management, CADE decided to assess the market taking into account the particularities of XP’s business model (and also its disruptive characteristic as a maverick firm, as further explained below). XP is an open platform of investments and was classified by CADE as a marketplace for financial products. As such, according to the Brazilian authorities, XP introduced a new model that disrupted the market and increased competition by allowing competition between many different financial products issued by different institutions under the same platform; promoting competition between such open platforms and the traditional banks; and reducing the entry barriers to the market. CADE challenged the traditional boundaries of relevant market definition and analysed the effects of the merger taking into account the perspective of both sides of the platform (issuers and consumers of financial products). Therefore, to reflect the competitive dynamics of the market, CADE analysed the vertical effects of the mergers taking into account open platforms only, while the horizontal effects were analysed in accordance with the traditional relevant market definition for institutional brokerage (i.e., considering both open platforms, such as XP, and traditional banks, which also distribute their own financial products).

Furthermore, in Allied Tecnologia/Arte Telecom, CADE has also acknowledged that, despite the differences between consumers’ perception of online and offline retail markets, given the fast-paced transformations perceived in the online markets, it is possible that e-commerce may influence – even if only to a certain extent – the offline market dynamics. This is mainly because consumers often use e-commerce as a price reference for products, even if the products are eventually bought through offline channels.

Innovation, market power and competitive dynamic

Digital-driven markets are also changing the way that competition authorities assess market power in segments that are not necessarily measurable through market shares. In this respect, recent cases show that CADE has been paying attention to the specific characteristics of multisided platforms (such as network effects and multi-homing), as well as innovation. In fact, in its latest decisions, CADE has put significant weight in the empirical analysis of the role of innovation in the competitive dynamics of digital markets.

In the Itaú/XP case, for instance, CADE analysed the characteristics of the market as a two-sided platform. To assess the effects of the merger and the ability to exercise market power, CADE took into account: the mutual interdependence between the issuers of financial products, on one side of the market, and consumers of financial products on the other; relatedly, the indirect network effects (typical of multisided platforms, in which the utility of one side of the platform increases with an increase in the number of users on the other side); and users’ ability to affiliate to more than one platform at both sides (multi-homing effects) – which could be hindered by exclusivity arrangements.

In that case, CADE also considered that XP’s disruptive characteristic (the GS considered XP as a maverick firm) was sufficient to justify a deeper market analysis, despite the low combined market shares resulting from the transaction under a traditional relevant market definition. According to CADE’s horizontal merger guidelines, mavericks are companies with low cost of production and low prices or those that stimulate permanent innovation in the segment in which they operate. In this sense, a maverick can discipline the market by forcing prices down, independently of its market share.

Beyond the classic market share assessment, CADE has been analysing the reduction (or increase) in the incentives to innovate as a possible effect of mergers in digital markets. Although the analysis of innovation is not new (CADE’s horizontal merger guidelines include innovation as one of the variables that should be taken into account in the competitive assessment), it was not until recently that CADE has relied more intensively on innovation as an important feature of the assessment of mergers in digital, technology-intensive markets.

Innovation competition was also included in CADE’s analysis of Naspers/Delivery Hero. In that case, CADE’s GS noted that it is challenging to undertake the competitive analysis of ‘new’ digital markets. According to CADE, ‘the difficulty of applying the traditional tools begins in the discussions involving relevant market definition . . . it is specially challenging to analyze the competitive dynamics, identify market trends and assess rivalry or even consumer behavior in new, rapidly-changing markets.’ In this respect, innovation was considered crucial for the antitrust analysis of competitive dynamics in an environment of constant change. 

Innovation was also taken into account by CADE in Telefônica/AG and Telefónica/GVT, in which CADE assessed whether the proposed transaction would have an impact on incentives to innovate. CADE reached the conclusion that the proposed transaction could introduce new technologies and ultimately benefit consumers. CADE has done the same exercise in other cases involving technology-intensive markets that, although not related precisely to digital markets, demonstrate that CADE has been putting considerable weight in the way that a proposed transaction changes the parties’ incentives to innovate. 

Therefore, the ability to innovate or to invest in research and development has been seen by CADE as a valuable parameter to analyse the impact of a proposed merger in untraditional markets that cannot be properly assessed exclusively under traditional tools.

Criteria for mandatory filing

As seen above, in Brazil, the thresholds for mandatory filing are based on the parties’ turnover. However, in a digital, data-driven economy, market power and turnover are not necessarily interconnected.

This issue has recently been raised by CADE in the analysis of Naspers/Delivery Hero. In its decision, CADE’s GS noted that iFood had been carrying out several acquisitions of small start-ups that did not meet the revenue thresholds for mandatory filing. The GS concluded that such a strategy should be closely monitored by the antitrust authority in future cases, since it could serve as a barrier to the entry (i.e, according to CADE, if every start-up is acquired by iFood, it is unlikely that a competitor would reach a point when it could exercise competitive pressure in the market). 

The inadequacy of the current mandatory filing thresholds has been pointed out by CADE in other cases. In Itaú/XP, CADE noted that revenue-based thresholds may not be sufficient for innovation markets, and cited a speech by Margrethe Vestager in 2016, according to which ‘when someone buys up an innovator, with a lot of good ideas but not yet much in the way of sales, we might not even have the chance to look at whether that merger will be bad for innovation’. CADE’s General-Superintendent Alexandre Cordeiro has also mentioned that many companies that are active in the digital world have no income, and that the current minimum revenue thresholds should be revisited – as well as the traditional tools and parameters for merger analyses, which may not be enough for the assessment of mergers involving multisided platforms, big data and other factors. 

In any case, despite the revenue thresholds determined by law, the BCL allows CADE to request notification of transactions that do not fall under the filing thresholds within one year of their consummation.

Big data, digital economy and merger analysis

Another important feature of the competitive analysis of digital economy markets is access to big data. Some consider that access to big data is an important competitive advantage and a barrier to entry. Therefore, in merger cases involving big data issues, the competition authorities may analyse whether the access to the merging parties’ data is essential for third parties to be able to compete in a given market and whether such data is difficult to replicate (smaller players, for instance, usually have more limited capacity to collect data). On the other hand, some consider that the access to big data should not be considered as a competitive advantage as, among other things, access to data is non-rivalrous and ubiquitous, and data is widely available and inexpensive.

In Brazil, CADE has yet to face the challenges imposed by big data issues in merger analysis involving digital markets, as no merger case has dealt with those issues directly so far. In a recent merger case involving the creation of a credit bureau by the five largest banks in Brazil, CADE considered that the access to data was essential in this market and negotiated remedies with the parties in order to guarantee non-discriminatory access to data by competitor credit bureaus, as CADE’s main concern related to the risk of foreclosure in the positive and negative credit scoring markets. In other cases, big data was mentioned as a competitive advantage. In the ATT/TWC merger, for instance, CADE mentioned that streaming services such as Netflix determine consumer preferences by using big data, which provides them with a significant competitive advantage.

Therefore, the Brazilian experience in merger cases involving e-commerce and digital markets, albeit limited, shows that CADE is likely to adapt its traditional analysis and tools as a response to the new challenges posed by the digital economy. CADE tends to undertake an empirical analysis of the competitive dynamics of the affected markets on a case-by-case basis.

Administrative persecution of anticompetitive conducts involving digital markets

The BCL broadly determines that any act, regardless of guilt, shall be considered a violation of the economic order if it has by object or is able to produce any of the following effects: limiting, restraining or injuring competition and free initiative; leading to the artificial control of the relevant market of goods or services; arbitrarily increasing profits; and constituting the abusive exercise of a dominant position. 

Those acts encompass both unilateral and collusive conduct, but different approaches apply to each one. Regarding unilateral conduct, as a rule, CADE adopts the ‘rule of reason’ approach to assess abuse of dominance.  This means that, more than the identification of conduct that is restrictive of competition, the authority shall balance the efficiencies caused by the conduct and its anticompetitive effects in order to assess its legality. 

On the other hand, under the per se approach, applied to the analysis of cartel cases under the BCL, certain conduct is always declared illegal and therefore subject to administrative – and also criminal – prosecution. 

E-commerce, digital economy and CADE’s investigations

As seen above, CADE’s analysis regarding the ‘digital economy’ encompasses subjects such as e-commerce, online platforms and other technology-related markets. Several kinds of conduct relating to online sectors have come under the Brazilian authority’s scrutiny over the past few years, mostly related to abuse of dominance. Even though CADE has no specific guidelines for the analysis of conduct in the online sector, those decisions provide an indication of CADE’s antitrust concerns and therefore can be a useful guide to those active in the digital economy. The worries expressed by CADE can give us a hint of potential points of attention that one should bear in mind when dealing with the digital economy. 

The goal of this section is to identify the main issues and concerns that CADE has voiced in some of its most recent relevant investigations of abuse of dominance cases related to the digital sector.

Abuse of dominance

As explained above, CADE’s analysis of abuse of dominance is based on the rule of reason approach. Therefore, apart from cartels, potentially anticompetitive conduct will be analysed with an investigative inquiry regarding its economic rationale, which will balance its positive and negative effects on the market dynamics. ‘Does the firm have a legitimate business reason for its conduct, and is it designed to benefit consumers?’, ‘is the firm adopting tactics that are designed to harm competitors?’, and ‘are competitors able to compete notwithstanding the effects of the dominant firm’s conduct in the market?’ are some of the questions that may be posed by the authority.

Anticompetitive conducts and the rule of reason approach

The investigations against Google are examples of the rule of reason approach. CADE has opened six investigations against Google over the past few years, all related to alleged discriminatory and exclusionary conduct. In October 2013, CADE launched three administrative proceedings against the company concerning: alleged ‘scraping’, through which Google would be gathering content from price comparison websites with its search engine to be used in its own downstream price comparison tool (Google Shopping); the terms and conditions of the Adwords product, which would supposedly prevent advertisers from multi-homing; and other alleged anticompetitive conduct related to Google Shopping. In the Google Shopping case, two allegations were under investigation: (1) the company was accused of influencing the organic search on its search tool (Google Search) in order to privilege its own price comparison website (Google Shopping); and (2) the company was supposedly applying a discriminatory display structure in Google Search for results from Google Shopping, to the detriment of results from third-party price comparison websites. While results from Google Shopping were displayed as sponsored links accompanied by images of the products, results from third parties were displayed as unpaid general organic search results. In September 2016, CADE launched a fourth investigation related to Google.  This concerned the allegation that Google took advantage of its dominant position in the universal search market to divert traffic to its own products, including its own local search engine ‘Google+’. Finally, CADE has recently opened two new investigations against Google. One is a preliminary probe related to Google’s alleged abuse of dominance in the mobile device market by the use of the Android operating system; and the other was opened after the Tribunal’s ruling on the Scraping case, as explained below.

While Google+ is still under analysis, the other three cases (ScrapingAdwords and Google Shopping) were dismissed by CADE’s Tribunal after the GS’s non-binding opinion recommending their dismissal due to insufficient evidence showing that the alleged conducts could harm the competitive environment.

In the Scraping case, the Tribunal confirmed the GS’s opinion, but also recommended that the GS should open an investigation to ‘verify the conditions of competition and potential abuse of dominance in the search market, as well as in vertically related markets’. 

In the Adwords case, the Reporting Commissioner recognised that, although some clauses of the terms and conditions (T&Cs) of the Google Adwords application programming interface indeed imposed some restrictions on its users, they were considered to be ‘rational and reasonable, since they aimed at providing a better utilisation of the platform to advertisers, Google itself and even the consumers’. Furthermore, the Tribunal confirmed the GS’s opinion that there was no causal link between AdWords’ T&Cs and the fact that multi-homing was not a practice among advertisers.

In Google Shopping, the GS concluded that it was not possible to establish a causal link between Google’s alleged conducts and potential negative effects on the market. Although the investigation indicated that there might be negative effects on price comparison services (PCSs) due to Google’s refusal to offer space to the PCSs in the product listing ads, there was insufficient evidence that the conduct hindered competition in the market. At the end, the Tribunal confirmed the GS’s non-biding opinion and dismissed the case.

The Google Shopping investigation illustrates CADE’s concerns regarding hybrid platforms’ self-preferencing (i.e., the risk of self-preferencing by players that both operate the platform and, at the same time, compete with the other sellers or service providers that are active in such platform). Also related to hybrid dominant platforms’ behaviours under CADE’s watch is the consultation submitted by Redecard SA (Rede), a payment processor, regarding the lawfulness of some contractual provisions entered into with Visa, Mastercard, Amex and Elo, which would cause Rede to access alleged sensitive competitive information from payment facilitators. The issue raised by CADE while assessing the case was that payment processors (such as Rede) could also compete with payment facilitators in certain circumstances, so that, if Rede had access to such information, it could increase its dominant position in the market and eventually enable the adoption of discriminatory and exclusionary practices. In order to better analyse if the provisions amounted to an antitrust infringement, CADE’s Tribunal converted the consultation into an investigation, which is still ongoing. 

Taking these cases as the starting point for reflection, one of the most common questions in cases involving a digital economy player with a dominant position is whether the company’s conduct is exclusionary or just the regular exercise of market power. Are the criteria for search, ranking and advertising, as well as the terms related to the use of the platform or business, reasonable, objective and non-discriminatory?

A similar line of questioning was relevant to another case – an investigation regarding the online travel agencies (OTAs), Booking, Expedia and Decolar, and their use of parity clauses (most favoured nation (MFN) clauses).  The OTAs were investigated for alleged abuse of dominance and anticompetitive conduct for imposing MFN clauses on hotels. The clauses prevented hotels from offering lower prices or better conditions in their own online and offline channels. CADE concluded that, although ‘wide’ parity clauses would be abusive, ‘narrow’ clauses were acceptable under Brazilian law.

In that case, the weighing of positive and negative effects to the competition landscape had a major role. In a balanced approach, CADE pointed out that MFN clauses restrain competition among OTAs by equalising prices offered to consumers and creating barriers to entry to new OTAs. However, CADE also acknowledged that MFN clauses deter free-riding in the online hotel booking market, so that the parties should be allowed to use MFN clauses in relation to hotels’ direct sales through their own websites. Following this approach, the settlements between CADE and the OTAs prohibited the use of MFN clauses to prevent better sales conditions in offline channels (over the counter sales at hotels, smaller travel agencies and telephone sales) and also prevented OTAs from using MFN clauses in relation to other OTAs, but it did allow OTAs to establish parity clauses in relation to direct online channels (narrow MFN clauses). 

The telecom sector has also been scrutinised by CADE under a rule of reason approach. In Claro/Tim/Oi/Vivo the four major Brazilian mobile services providers were investigated for allegedly anticompetitive practices through discriminatory ‘zero-rating’ practices. The mobile services providers would only offer such access conditions to the most popular social media applications, such as Facebook, WhatsApp, Instagram and Twitter, which, according to the complaint, would strengthen these companies’ dominant positions, and prevent smaller players and new entrants from competing on equal conditions. CADE dismissed the case, as no evidence was found that the zero-rating practice distorted the competitive landscape. 

Another important matter to the e-commerce sector is the minimum advertised price policy (MAPP). Recently, Continental (a tyre and car parts manufacturer) submitted a consultation to CADE regarding the lawfulness of the MAPP it was willing to implement in the aftermarket for commercial and passenger tyres. The Reporting Commissioner concluded that, in that case, the policy was considered lawful considering that (1) Continental did not hold unilateral or coordinated market power; (2) the MAPP was designed and implemented unilaterally by Continental, in the sense that those affected by it could not have any decision-making power while establishing the prices to be followed; and (3) the MAPP did not discriminate against different resellers. On the other hand, the dissenting Commissioner highlighted that ‘any minimum price policy should be reviewed as per se illicit’. As such, future cases involving MAPP clauses must be reviewed on a case-by-case basis.

Discriminatory practices and restriction to the access of essential infrastructure

Discriminatory and exclusionary practices have also been the subject of recently opened investigations involving fintech companies. In these cases, traditional players are accused of discriminatory treatment regarding the fintechs, hampering their access to the markets in which they are active.

In Stone/Braspag, for example, Stone Pagamentos SA, which is a creditor responsible for the clearing and settlement of receivables, made representations against Braspag Tecnologia de Pagamentos Ltda, a company from Bradesco’s economic group that provides gateway services for online shopping payments. According to CADE, the initial investigation brought to light evidence that, anchored in its dominant position in the gateway services to online shopping payment market, Braspag denied Stone’s attempts to contract with the gateway service platform. The refusal was based on Stone having a ‘minimal volume of transactions’ and ‘minimal number of clients’, criteria that would not have been applied to other competitors of Stone in the payment market. The main issue under CADE’s scrutiny is the alleged refusal by Braspag to give access to Stone to an infrastructure that is essential to access small and medium-sized e-commerce businesses that operate through the Braspag system. In March 2019, the GS dismissed the case, as the investigation showed that Braspag did not create any barriers to Stone.

In a more recent case, Stone presented complaints against Banco Santander Brasil SA. According to the representation, Santander (which controls Getnet, one of Stone’s competitors in the payment processor market), was benefiting from its verticalised structure by ‘requiring de facto exclusivity from retailers through incentive contracts and also tying banking services linked to its payment products and services’. By doing so, the bank would be allegedly hindering Stone’s and new entrants’ development in the market, which could strengthen the bank’s dominant position. The investigation is still ongoing and CADE has not yet issued any decision.

Another fintech-related investigation is based on a claim from Nu Pagamentos SA (Nubank), a Brazilian unicorn active in the credit card business. According to Nubank, banks hampered its access to the credit card vertical market, through the refusal to contract services as automatic debit, intraday statement and liquidating bank services. The concern lies in the alleged refusal of traditional players with clear market dominance to give access to essential infrastructure to new entrants in the credit card market. In April 2019, in relation to the first claim, CADE converted the investigation into an administrative proceeding against Banco do Brasil, Banco do Bradesco, Caixa Econômica Federal and Banco Santander. The case against Itau was dismissed, since it provided reasonable justification for the fees applied to Nubank. As for the refusal to contract intraday statement, the case was closed due to the lack of evidence that it amounted to an anticompetitive conduct. 

Similarly, the Brazilian Association of Cryptocurrencies and Blockchain has claimed that traditional banks refuse to contract with cryptocurrency operators, limiting their access to infrastructure that is essential to its operation in the market. 

This brings us to a third question to bear in mind when dealing with players from the digital sector: are the criteria for the admission, suspension and exclusion of partners and users reasonable, objective and non-discriminatory? As seen from the cases discussed above, this issue is particularly relevant to CADE’s analysis in cases in which there is the suspicion that the refusal to contract may result in the foreclosure of access to essential infrastructure, and therefore the issue should be borne in mind by dominant companies active in digital markets.

Concerted conduct in technology-related markets

Another traditional antitrust concern in technology-related markets, which has also been under CADE’s scrutiny, is the coordination by a supplier of its resellers’ activities.

Positivo Informática’s case is, for example, one of CADE’s ongoing investigations involving an alleged hub-and-spoke cartel. Positivo, a supplier of computers and IT equipment (e.g., tablets, projectors, smartphones), is being investigated for centralising and passing on sensitive information to its resellers, with the objective to direct contracts and coordinate bids. According to CADE’s investigation, Positivo’s resellers would report any business opportunity to Positivo, which would pursue the opportunity directly or would assign it to the reseller. In addition, Positivo would pass on detailed and sensitive information regarding the opportunity to the other resellers, in order to coordinate their behaviour and allow the assigned reseller to be the winning bidder. CADE considered Positivo’s arrangements to be potentially harmful for intra-brand competition, and that Positivo was possibly fixing reselling conditions to third parties and influencing the adoption of uniform conduct by competitors. 

New business models and CADE’s analysis

Uber has also been the subject of CADE’s investigations. The authority has opened three investigations involving the new player, all of them in some way related to its innovative business model. Two relate to alleged anticompetitive conduct by Uber, and the third was initiated by Uber, which accused several taxi entities of sham litigation practice. Even though all three inquiries have been closed based on the insufficiency of evidence, the cases triggered CADE’s effort to better understand Uber’s new business model. In addition to the investigations, CADE’s economic sector has carried out independent studies to analyse the disruptive business model, in order to better understand the market and properly assess its competitive dynamics. Overall, CADE has taken a considerably favourable position in relation to Uber, having recognised its pro-competitive character. CADE has recommended that local legislators be careful with initiatives to regulate Uber, in order to avoid measures that could possibly prevent the use of individual transport apps. Moreover, CADE’s economic sector has argued that a gradual deregulation of taxi activities could also be pro-competitive.

From that, we can notice an open posture of CADE in relation to new technologies and its comprehension that, for some cases, sticking to old approaches and definitions may not be sufficient for an accurate analysis of the market dynamics.

Data and potential anticompetitive practices

Another undoubtedly pressing issue in the digital economy is the use of big data and potential anticompetitive practices. In this context, the only investigation started by CADE concerning this topic, GuiaBolso/Bradesco, may soon trigger the debate on the interplay between data and antitrust. GuiaBolso is a Brazilian personal finance application that accesses the personal banking information of customers (if authorised by those customers), through their internet banking connections. CADE opened an investigation against Bradesco for potential exclusionary conduct because of its resistance to allowing GuiaBolso’s access to its internet banking system, which could prevent new entrants’ access to the market.

In the Google Shopping case mentioned above, the Reporting Commissioner’s vote touched on some important issues related to the digital market, such as the interplay between data and antitrust. In this sense, he analysed whether the data held by Google could amount to an essential facility, and concluded that, since ‘personal data is non-rival, non-exclusionary and ubiquitous, the access to data, itself, would not be the main concern, but rather the treatment that will be given to the database’. Therefore, personal data could not be considered an essential facility.

Considering the cases explored above, non-merger antitrust analysis so far seems to be concerned with traditional antitrust questions formulated in not-so-traditional ways.


In the context of global digitalisation trends in the economy, the rise of new business models and the growing use of multisided platforms, CADE has been facing the challenge of reconsidering its merger review methods and clearing space for the analysis of potentially anticompetitive conducts in these new market structures.

The recent merger review and investigation cases described above in the e-commerce, digital and other technology-related markets provide a good indication of how CADE will likely approach some of the main issues posed by these sectors in ongoing and future cases.

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