Juntos - December 2024

Welcome to Juntos, our quarterly bulletin that explores key developments in antitrust and competition enforcement and regulation in the Americas with a concern for broader impacts across the region. In this issue, we examine headlines from the last quarter of 2024.

CNDC prioritizes agency independence, cartel enforcement. In public remarks at an international conference in November, the president of Argentina’s National Commission for the Defense of Competition (CNDC) laid out the enforcer’s key priorities, stressing greater agency independence, particularly for effective merger review and enhanced anti-cartel enforcement.

Increased CNDC independence (currently, the enforcer operates under Argentina’s Ministry of Productive Development), according to the official, would allow Argentina to develop a merger review system more similar to those throughout most of the world, under which parties would be required to provide notice of certain transactions. This would allow the CNDC to review and challenge mergers and acquisitions that threaten competition before they are closed.

The agency head also noted his intent for the agency to impose fees for pre-merger notifications. Argentinian law already allows for the imposition of these fees, but to date, they have not been enforced by the CNDC.

Further, the agency intends to crack down on antitrust cartels by deploying additional investigative measures and seeking stronger sanctions in price fixing, bid rigging, and market allocation matters. The agency head expressed that sanctioning cartel conduct was essential to drive more applicants to the country’s recently deployed leniency program.

The remarks demonstrate the CNDC’s status as a still-developing agency within the Argentinian government, while showing its ambitions to take a convergent enforcement position with other competition enforcers throughout the Americas on core functions like merger review and cartel enforcement. If these goals are reached, antitrust law enforcement in Argentina may become more technical and robust.

Brazil investigates algorithmic pricing. Brazil’s competition authority, the Administrative Council for Economic Defense (CADE), launched an investigation into an AI-driven algorithmic pricing tool used for dynamic pricing at gas stations in late November. CADE expressed concerns that the tool can enable “concerted practices that could lead to antitrust violations.” This is CADE’s second algorithmic pricing investigation.

The agency’s concerns mirror those of several other competition enforcers around the world about the potential anticompetitive uses of algorithmic pricing tools. Some, like the US DOJ, have alleged violations of antitrust laws, as in the DOJ’s recent lawsuit against RealPage.

As novel applications of the antitrust laws to emerging technologies begin to appear, and as AI-driven revenue management tools become more prevalent in business, the progress of these cases may set important precedent. Companies are encouraged to understand the competition law impacts of the use of these technologies, including those sourced from third parties.

Brazil’s new digital markets regime. Brazil’s government has renewed its focus on digital markets and platforms after a report from its Ministry of Finance warned that the existing antitrust law is not effective in regulating the power of the world’s biggest tech companies. Under proposed measures in the country, CADE would receive new powers to designate certain platforms as “systemically relevant” based on specific criteria, a policy seemingly inspired by the EU’s Digital Markets Act (DMA).

Although no major changes are imminent, the government is expected to present a new bill to the National Congress soon. Such a bill could empower CADE to create a specific regulatory framework for digital platforms and impose behavioral obligations on designated companies.

As tech companies have experienced in the EU under the DMA, a new ex ante regulatory regime in Brazil would likely require significant additional resources dedicated to compliance, a part of which means that designated companies may need to adapt their products marketed in the country to conform with local regulatory requirements.

Chile seeks record cartel fine. In October, Chile’s national competition enforcer, the Fiscalía Nacional Económica (FNE), filed a complaint with the country’s competition tribunal alleging that three casinos rigged bids for nationwide operating permits in 2020 and 2021 (Casino Case). The FNE’s complaint alleges that the casinos concealed their conduct in several ways, such as by attending secret meetings that were arranged over ephemeral messaging platforms and held after hours, using code words to conceal their conduct, and deleting evidence from mobile devices after the meetings. As a result of the conduct, the FNE alleges that the country’s casino regulator received substantially less for the permits than it would have if the bidding had been competitive.

The FNE is seeking a total of over USD150 million in fines from the three casinos, including seeking from one defendant what would be by far the highest fine imposed for cartel conduct in Chilean history: approximately USD112 million.

The complaint is the most recent example of the FNE’s aggressive cartel enforcement. Earlier in 2024, Chile’s competition tribunal imposed the country’s current largest ever fine, totaling approximately USD27.6 million.

The Casino Case also charges five individual defendants for their role in the alleged bid rigging. These individuals may face referral for criminal prosecution by Chile’s public prosecutor and possible imprisonment at the conclusion of the administrative proceedings. Chile's law has allowed for criminal prosecution since 2016, and the head of its competition authority has stated publicly that the agency hopes to utilize this power soon, citing the experience of the US in noting that “the threat of criminal prosecution really is a very important deterrence tool” to use against cartels.

Mexico’s COFECE flexes its enforcement powers despite political duress. Two recent enforcement actions initiated by Mexico’s Federal Economic Competition Commission (COFECE) show the agency’s willingness to stretch its enforcement powers beyond historical boundaries.

In October, for the first time ever, COFECE exercised its authority to file civil class action lawsuits in a novel class action case against drug distributors. The suit seeks over USD100 million from the defendants – which include an industry association – for the alleged damages from a decade-long cartel that limited supplies and fixed prices of medicines sold to pharmacies. The parties, other companies, and 21 individuals were previously fined in 2021 for their roles in the cartel investigation carried out by COFECE.

In the class action, the COFECE itself will act as the class representative and bear all the costs of the legal proceedings, which are brought on behalf of Mexican citizens, with any damages awarded to be paid to a government health services program.

In another potentially novel development, a COFECE investigation concluded in October that anticompetitive conditions exist in the maize flour market. As a corrective measure, the COFECE investigation suggested that one of the largest tortilla producers in Mexico should divest five of its plants, as well as a large portion of its distribution and sales workforce, to address practices that prohibit downstream factories from changing suppliers. The use of COFECE’s break-up powers based on a market study demonstrated an alternative to a more traditional abuse of dominance investigation. Market investigation powers allow COFECE to seek remedies without needing to prove an actual violation of Mexico’s competition law.

COFECE’s novel uses of its enforcement authority occur at a time when the agency’s future is uncertain. In late November, both houses of Mexico’s legislature passed a constitutional reform bill that would strip the agency of its independence – which it has possessed since being created by constitutional reforms in 2013 – and make COFECE part of the executive branch. Pursuant to the decree, COFECE would be replaced by a new competition authority that would also be assigned the powers currently held by the Federal Telecommunications Institute (IFT), combining the two agencies.

COFECE has responded to the bill by saying that it will work within any institutional framework to ensure a robust competition policy in Mexico, operating “with technical and operational independence,” and, until any reform enters into force, promising “to make maximum use of its powers.” The bill now goes to the state legislatures.

Peru celebrates five years of cooperation between the OECD and INDECOPI. Peru’s competition enforcer, the National Institute for the Defense of Competition and the Protection of Intellectual Property (INDECOPI), recently marked the five-year anniversary of its collaboration with the Organization for Economic Cooperation and Development (OECD) in hosting the Regional Centre for Competition in Latin America and the Caribbean (Center). Since its creation, the Center has brought together over 1,800 competition enforcers, regulators, and judges from 25 countries across the region to discuss shared concerns and the best practices and public policies to enhance competition enforcement in areas such as digital markets and anti-cartel enforcement, as well as the judicial review of enforcers’ actions.

By fostering this international cooperation, the Center enhances national enforcers’ ability to more effectively pursue cross-border conduct that impacts the Americas.

New HSR rules for 2025. In October, the Federal Trade Commission (FTC), with the support of the US Department of Justice (DOJ), voted unanimously to finalize the proposed changes (Final Rule) to the US premerger notification form and associated instructions under the Hart-Scott-Rodino Act (HSR Act). The Final Rule is a significant overhaul of the current regulatory system and adds a substantial new burden on merging parties. Among other changes, the Final Rule brings the US notification process closer to that of European antitrust enforcers, requiring narrative descriptions of reason for transaction, details of the parties’ businesses, and any overlaps or other relationships between the parties. In addition, a broader range of documents will be required.

The Final Rule marks a major shift for a policy that had remained unchanged for over 40 years. All HSR filings submitted on or after February 10, 2025 will need to conform to the new requirements.

Impacts of US election on antitrust enforcement. The US election results may lead to changes away from the aggressive antitrust enforcement positions staked out by the DOJ and FTC (jointly, the Agencies) under the Biden Administration. While new agency heads have not been named and the enforcement priorities of the new Trump Administration may not be known for some time, it is possible that merger control, cartel enforcement, and the pursuit of civil litigation alleging antitrust violations all may be impacted domestically, as might the Agencies’ relationships with international enforcers throughout the Americas.

DOJ updates criminal antitrust compliance policy. The DOJ’s Antitrust Division recently updated its guidance on the evaluation of corporate compliance programs for criminal antitrust violations (Antitrust ECCP), which federal prosecutors use to evaluate the compliance efforts of corporate subjects under their investigation. The updated Antitrust ECCP adds significant details regarding the Antitrust Division’s expectations of compliance in several important areas, including:

• Artificial intelligence (AI)- and algorithm-driven revenue management tools


• The use of ephemeral messaging and personal devices for business purposes


• Efforts in fostering a compliance culture that flows not just from the top but from managers at all levels, and


• Protections for and preservation of whistleblowers’ incentives to self-report.

In addition, it is possible that the Antitrust ECCP may now apply beyond the criminal context.

The Antitrust ECCP provides companies with a useful blueprint for the design of their antitrust compliance programs and, according to the DOJ, should “allow [] companies to craft a coherent, holistic compliance program taking into account the company’s lines of business and risk profile.”

The guidance recognizes that not all businesses will have the same resources available for antitrust compliance and makes clear that the DOJ’s prosecutors should consider efforts by multinational corporations to meet standards across multiple jurisdictions and areas of law.

For companies that wind up in the DOJ’s crosshairs, earlier investment in an effective compliance program can act as a valuable corporate insurance policy in the event of a criminal antitrust violation. It also could lead the DOJ to adopt positions that greatly reduce collateral exposure or significantly lower fines.

In addition, the Antitrust ECCP may allow companies to detect potential violations before enforcers do, opening the door to pursue valuable benefits like leniency from prosecution.