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Brazil Poised to Update Antitrust Merger Reporting Thresholds

By  |  January 30, 2025

Brazil’s Ministry of Finance and Ministry of Justice and Public Security are expected to announce an update to the revenue thresholds that determine whether companies must notify the Administrative Council for Economic Defense (CADE) of mergers and acquisitions. According to a statement from sources familiar with the matter, the revision is aimed at alleviating CADE’s workload and allowing it to focus more on regulating big tech companies.

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    Under current antitrust regulations, companies must report deals if at least one party had revenues of R$750 million and the other at least R$75 million in the previous fiscal year. However, according to people involved in the discussions, these thresholds are likely to be increased to R$1 billion and R$200 million or potentially even higher.

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    Per a statement from government insiders, the proposed adjustment would be enacted through an administrative rule issued by both ministries. This measure is expected to significantly reduce the number of merger cases requiring notification—potentially cutting the caseload by about one-third. The move aligns with broader governmental efforts to refine competition policy, particularly in sectors dominated by large technology firms. A related legislative proposal focusing on digital markets is also in development and is expected to be presented to Congress soon.

    Brazil’s antitrust law (Law No. 12,529), which took effect in 2011, originally set the revenue notification thresholds at R$400 million and R$30 million. These figures were last revised in 2012, when they were increased to their current levels. Since then, inflation and economic growth have led to record numbers of reported transactions, contributing to a growing backlog of cases at CADE.

    According to data from CADE, the regulator handled 712 merger notifications in 2024—an increase of nearly 20% from the previous year. Efforts to streamline the review process have included the use of artificial intelligence, which helped reduce the average processing time for standard cases from 117 days in 2023 to 93.9 days last year. However, experts argue that adjusting the revenue thresholds is necessary to ensure that CADE can allocate resources more effectively and focus on complex cases with greater potential impact on market competition.

    Source: Valor international