Law n. 1179 that flexibilizes competition legislation has been sanctioned

On June 10, 2020, Law 14,010, proposed by Senator Antonio Anastasia, was sanctioned. This Law established the emergency and transitional regime for private law relations during the Covid-19 pandemic. Inspired by the Failliot Law, enacted in France during the First World War, the Law was designed to avoid a cumulative effect of the economic crisis by means of breach of contracts and scarcity of services and products.

Among the rules provided for in the Law, article 14 interrupts the effectiveness of the following provisions of Law No. 12,529/2011 (Competition Law – LDC), during the period from 03.20.2020 to 10.30.2020 or while the state of public calamity established by Decree No. 6/2020 lasts:

 Predatory pricing (art. 36, §3, item XV);

  • Partial or total ceasing of the company’s activities without justified cause (art. 36, §3, item XVII); and
  • Mandatory notification of associative contracts, consortiums, or joint ventures (art. 90, item IV).

 Other anticompetitive violations listed in art. 36, practiced as of03.20.2020 or throughout the duration of the declared state of public calamity, should be analyzed by the Administrative Council for Economic Defense (Cade), considering the extraordinary circumstances arising from the pandemic.

 With respect to the suspension of the notification requirement for certain mergers, this does not rule out the possibility of subsequent review of the transaction or the investigation of violations of the economic order of agreements that are not necessary to combat or mitigate the consequences of the pandemic.

 This Law is temporary, not implying a revocation or amendment to the LDC. It came into force last Friday (June 12, 2020).