LatAm’s new competition

Author: | Published: 23 Dec 2011

With the sluggish US recovery and the European sovereign debt crisis pushing investment into Latin America’s emerging economies, attorneys must take note of antitrust reforms spreading across the region.

Legislative changes remove competition uncertainties in Brazil and Argentina, but create new concerns in Ecuador which commenced competition regulation in October.

The most monumental change occurred on December 1 when Brazilian President Dilma Rousseff signed into law the overhaul of the country’s antitrust authority, Administrative Counsel for Economic Defense (CADE). CADE’s merger review process will now occur before, rather than after, a deal closes. CADE’s review period has also shortened, which is hoped will combat the share price volatility experienced under the post-merger review system.

LAN Airlines’ recent acquisition of TAM Airlines provides a good example of shortcomings under the old regime. The deal between the Chilean and Brazilian airlines was announced on...