Lula appoints former PT councilor to Cade board and generates internal crisis

President Luiz Inácio Lula da Silva (PT) recently appointed a former party activist to fill a position normally held by members who are already part of the Administrative Council for Economic Defense (Cade). The body is responsible for arbitrating economic and antitrust disputes, but its Administration and Planning directorship was occupied by former PT councilor Ricardo Lovatto Blattes.

According to the newspaper’s findings The state of Sao Paulo confirmed by People’s Gazette this Wednesday (25), Blattes had his appointment confirmed on October 5 (see here). According to the CV published on Cade’s website, the now director has a degree in accounting, legal and social sciences and a master’s degree in criminology, criminal policy and security.

He has also served as director of the Department of Consumer Protection and Defense, at the National Consumer Secretariat (Senacon/MJ), and as president of the Management Council of the Fund for the Defense of Diffuse Rights (FDD). Blattes is a councilor for the licensed PT of Santa Maria (RS) in management from 2021 to 2024.

The investigation indicates that Blattes’ appointment to Cade’s board of directors did not involve prior discussion with the board, which would be customary for the position. The name is normally indicated by the Council’s own employees and sent to Planalto to simply comply with the necessary bureaucracy of publishing in the Official Gazette of the Union.

Blattes’ appointment to Cade, according to the investigation, raised concerns about possible political interference in the body and worsened tension in relation to pending nominations for the composition of the council, which also need to be approved by the Senate.

Cade must judge issues of interest to the PT, such as cartel investigations at PAC Favelas and negotiations on the sale of Petrobras refineries.

With Lula’s future appointments, the PT will have a majority in the court, made up of seven members. As of November, only Cade’s president, Alexandre Cordeiro, and two advisors will remain from the current staff.

The appointment of PT supporters has been worrying the market since the transition, at the end of last year. At the time, the nominations of then-senator Jean Paul Prates for the presidency of Petrobras and PT economist Aloizio Mercadante for the National Bank for Economic and Social Development (BNDES) raised doubts about a possible rigging of the state machinery by the party.

Earlier this week, Petrobras announced a change in the “policy for appointing members of senior management and the fiscal council”, which was interpreted by the market as a “dribble” in the State-Owned Companies Law. The measure, which still needs approval by the shareholders’ meeting, paves the way for the government to make more political appointments to the company.

The announcement caused Petrobras shares to fall 6.6% in the day’s trading session, with a loss of R$32.3 billion in market value.

Cade, Blattes and the Civil House were contacted by the Estadão report, but did not comment.