Author(s)
John M. Connor
Source
Competition Law and Policy in Latin America, D. Daniel Sokol and Eleanor Fox, eds., Hart, 2009
Summary
This paper reviews Latin American nations’ role in controlling cartels.
Policy Relevance
Higher fines and damages are needed to protect consumers from international cartels.
Main Points
- International cartels are durable and harm consumers by raising prices.
- Latin American consumers were overcharged $35 billion from 1990-2007 by the discovered 16 Latin American and 84 global cartels.
- A review of anti-cartel enforcement efforts by the United States, Europe, Canada, Argentina, Brazil, Chile and Mexico shows:
- Few cartels are detected. 84 global cartels fixed prices in Latin America, only 4 were investigated.
- Penalties and fines are too low in Latin America and Asia (e.g. in Brazil, at most 30 percent of illegal profits).
- Private lawsuits against cartels are common only in North America.
- In Latin American, experienced competition policy personnel are hard to find. The most effective is Brazil. Chile is the least effective. Among other things, Brazil’s regulators:
- Are most independent from political ministries linked to business.
- Punish individual cartel managers.
- Give amnesty and leniency to those who testify.
