iFood owner can be fined up to R$60 million by Cade

The General Superintendence of the competition defense body investigates whether one of the operations to purchase shares of shares in Solicitas Já by the delivery company should have been notified

The plenary of the Administrative Council for Economic Defense (Where) must analyze an investigation by the General Superintendence (SG) of the body that investigates whether there was a lack of notification to the municipality about the purchase of the delivery platform orders now to iFood in 2018.

The operation involves the parent company of iFood, the investment group Naspers, and DeliveryHero, a German company in the sector that operated in Brazil as Ordems Já.

If the majority of CADE’s directors understands that the notification was mandatory and that there was an omission by the body that oversees competition, fines ranging from R$60,000 to R$60 million may be imposed. The body can also decide to cancel the operation.

In a technical note, the General Superintendence pointed out that the companies should have notified Cade in at least one of the four operations to purchase the share capital of Delivery Hero made between 2017 and 2018. The fifth operation, which represented the acquisition of 13% of the company, was notified and approved by CADE.

According to an analysis by the SG, the companies should have notified the transaction because they met the minimum revenue requirement set out in the competition law and because of the way in which the purchase of shares took place.

In the document, the SG points out that companies could be penalized for gun jumpinga term that describes the situation in which companies concluded the deal ahead of time, that is, before the mandatory review by the antitrust agency.

The law determines that in case of non-notification of an operation that should undergo analysis by the body, the General Superintendence must open an investigation into the process. This investigation has already been sent to the court, which must decide whether or not to punish the companies.

In the technical note, SG recommended that companies notify Cade for one of the share purchases made in May 2017, when Naspers acquired 7.8% of the share capital of Delivery Hero.

The General Superintendence also recommended the imposition of a fine “because it represents an act of concentration not notified and consummated before being appreciated by CADE”. The globe searched for iFood, but still no response.

Source: O Globo Agency