CADE seeks to amend rules governing plea agreements, agency superintendent says

Brazilian antitrust authority CADE will propose changes to rules governing plea agreements in cartel investigations, said Carlos Ragazzo, the agency’s general superintendent.

The proposed changes will be subject to a public consultation period, which may happen as early as this week pending a final decision from CADE’s higher body, a seven-member tribunal presided over by Vinicius de Carvalho, Ragazzo told PaRR.

Without expounding on the topic, Ragazzo said the proposed changes will introduce flexibility in the manner in which plea agreements are executed, amending the current legislation to make it similar to laws governing such agreements in other countries.

The public consultation process, which typically lasts 30 to 60 days, will deal specifically with the Termo de Compromisso de Cessação de Conduta (TCCs), which is comparable to a cease-and-desist agreement signed by a given party interested in collaborating with authorities in cartel investigations, the CADE officer said. The changes will not affect the way leniency agreements are enforced by the antitrust watchdog, he added.

A leniency deal is typically offered to the first company that is implicated in an investigation and is willing to help investigators, according to a CADE spokesperson who was referring to provisions of Law 12,529, which came into force this year. In order to qualify for such an agreement, the company must also “confess” its participation in a cartel crime and end its illegal action. If at the time of the proposed leniency agreement CADE has enough evidence to secure a conviction, the investigated party will not qualify for a leniency agreement.

Provisions in rules governing TCC agreements must be perfected but, according to criminal lawyer Pierpaolo Bottini, it remains unclear what CADE specifically intends to fix. It is possible that CADE is considering changes in the legislation to incentivize more people implicated in cartel investigation to share information with the authorities, said the lawyer.

Another possibility is that CADE will refine the rules that identify exactly when leniency or plea deals can be struck, he said.

“Perhaps they are studying whether to execute the plea agreements after the public prosecutor’s office has initiated a legal case against the perpetrators of a crime,” speculated the lawyer. “Or maybe it could be that the plea agreement will stop commencement of the penal case,” he said.

Leniency and plea agreements aim to reduce the penalties or even pardon cartel crime perpetrators, provided they help authorities investigate the cases, said Bottini, a Sao Paulo-based criminal lawyer who represents companies accused of cartel violations. Leniency agreements are executed by CADE and are considered an administrative procedure, while plea agreements are a prerogative of the public prosecutor’s office.

Fonte: PaRR (Policy and Regulatory Report) - Competition Law – Global Intelligence – Parte do grupo Financial Times