South American leaders face limits in efforts to strengthen competition
The agency’s annual budget, he said recently at a conference,* is valued at $1 million — about a tenth of the resources allocated to CADE.
“I’m ashamed to say that, but it’s our reality,” González said. He praised the work done by his staff, which consists of more than 30 professionals.
CADE’s 2024 budget is about $10.3 million, and the agency’s staff consists of 323 employees. Conacom’s González called CADE a “big brother.”
— Uruguay autonomy —
Competition agencies’ dependence on higher authorities has raised concerns in South America.
Uruguay’s Commission for the Promotion and Defense of Competition, or CPDC, is linked to the Ministry of Economy and Finance but has been working in recent years to expand its autonomy, according to CPDC President Alejandra Giuffra, who began her term in 2019.
The Uruguayan competition agency is relatively new, having been created in 2007. Giuffra’s key priority is to implement budgetary autonomy to make CPDC’s action more proactive, she said at the conference. She also supports a revision of the leniency program to make it more comprehensive.
She said her staff is even smaller than the one in Paraguay — only 11 professionals have the daily responsibility to handle antitrust.
Despite the limitations, Giuffra celebrates the agency’s efforts to investigate and penalize major companies, such as Fábricas Nacionales de Cerveza. The agency imposed a “historic fine” of $4.8 million in 2022 for abuse of power in the beer market, she said.
“The agency’s goal is to take a more proactive approach, rather than a reactive one. We have been working reactively in response to the complaints presented to us,” Giuffra said.
Uruguay is seeking a simplified fast-track form for notification of less complex cases that require less attention from regulators, Giuffra said. “As an authority with limited resources, we can only take on deals that are truly important,” the CPDC president noted.
— Argentina —
Argentina is working to establish autonomy for its competition agency. A law approved in 2018 would create a successor to the National Commission for Competition Defense, or CNDC, but it has yet to be implemented.
CNDC currently operates within the Ministry of Productive Development, but it is set to be replaced by the National Competition Authority.
Alexis Pirchio, who became CNDC’s president this year under Javier Milei’s administration, said establishing a new competition agency would enable the country to finally implement an ex-ante merger review system.
“The agency’s independence implies not only autonomy with regard to the other government areas, but also a bureaucratic simplification that will ease in the finalization of files,” Pirchio said at the conference.
The CNDC budget, estimated at $1.5 to $1.7 million, is a concern for the competition authority president, but even with financial limitations, one of Pirchio’s objectives is to reduce the “great stock” of merger and competition cases that have been delayed.
— Paraguay’s law —
Paraguay’s competition law was instituted in 2013, but it could be modified, said González, whose term ends in 2025. He said “10 or 11 changes ” should be made, but only specifically mentioned approval of a leniency program.
González said strengthening Conacom would raise society’s awareness of the importance of competition.
“I say we must work on an ‘evangelization’ of competition so that people understand how important it is. And it’s not just good for the regulator, but also for the market, consumer and our economy too,” he said.
As with Uruguay’s CPDC, the Paraguayan agency aims to accelerate the analysis of fast-track cases in order to investigate complex deals more thoroughly. González added he expects steps to be taken toward that goal by the end of 2024.
South American authorities are united in their concern over the shortage of competition law courses, which limits the development of professionals with expertise in this area.
Argentina does offer several courses at its colleges. In Uruguay, there are no postgraduate programs available. Paraguay, according to González, is expected to launch its first postgraduate course in competition and regulation in the first half of 2025.
“Our people have been going to graduate school abroad,” González said.
* “30th International Seminar for Competition Defense,” Ibrac, São Paulo, Brazil, Nov. 6-8.
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