Against pressure, Cade’s superintendence will punish GLP – 06/12/2023 – Panel SA

The general superintendent of Cade (Administrative Council for Economic Defense), Alexandre Barreto, threatens to ban all companies that sell LPG, cooking gas, from sharing bottling infrastructure.

The decision is a response to pressure on Cade’s board made by competitors, especially Copagas, against the partnership between Supergasbras and Ultragaz.

The deal will be judged in early August and the superintendent argues that sharing is a common practice in the market, which is why he approved, without restrictions, the partnership between the two main companies in the field.

At Cade, the technicians who work in this process say that the case’s rapporteur, Lenise Prado, will vote against the partnership.

Although there is a tendency for the majority of the council to follow the superintendence’s recommendation, Barreto has already armed himself against an unfavorable decision by the council.

He said that, if the case is rejected, he will prohibit —the next day and with a stroke of a pen— the sharing of bottling and storage infrastructures, a practice that, according to him, will create a huge problem for the sector. With sharing, companies reduce costs and investments.

In addition to Copagas, consumer protection entities claim that the partnership could lead to a retraction in the supply of gas and an increase in consumer prices. They say that the sharing of operations would, in practice, be a merger. The claimants claim that the partnership will give rise to a group that concentrates around 60% of the national market.

Supergasbras and Ultragaz deny the merger and claim that the partnership provides for the operational improvement of the bottling bases, maintaining the corporate, administrative and commercial independence of the two companies.

With Diego Felix

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