This presentation by Amanda ATHAYDE, Professor of Law, University of Brasilia, was made during the discussion “Director Disqualification and Bidder Exclusion” held at the 139th meeting of the OECD Competition Committee on 29 November 2022. More papers and presentations on the topic can be found out at https://oe.cd/ddbe

1. FIRM BIDDER EXCLUSION
AND INDIVIDUAL DIRECTOR
DISQUALIFICATION:
Some reflections for international antitrust practice based
on an international benchmarking and on the Brazilian
experience between 2012 and 2022
Amanda Athayde
Professor of Law at Universidade de Brasília (UnB)/Brazil

2. FACT
The prominence of the application of antitrust
fines may have come to a CROSSROAD.

3. FACT
The prominence of the application of antitrust
fines may have come to a CROSSROAD.
Fines seem not to have achieved their
ultimate GOALS, either to punish
current and previous practices or to deter
future antitrust violations

4. Could non-monetary
antitrust sanctions
contribute EFFECTIVELY
to the antitrust
practice?
Fines seem not to have achieved their
ultimate GOALS, either to punish
current and previous practices or to deter
future antitrust violations
Simply increasing fines to companies or
applying criminal sanctions to individuals seem
not to be enough to generate INCENTIVES
not to practice anticompetitive conducts nor
to alter the market dynamics.
FACT
The prominence of the application of antitrust
fines may have come to a CROSSROAD.

5. SOME
INITIAL
REFLECTIONS

6. DIFFERENT GROUPS OF ARGUMENTS TO DEFEND THE
APPLICABILITY OF NON-MONETARY SANCTIONS
I.1.
UNDERTERRENCE
in specific cases: recidivism
Non-monetary
sanction as a
SUPPORT to
the fines
I.2.
OVERDETERRENCE
in specific cases: fine’s payment ability,
social and economic costs
Non-monetary
sanction as an
ALTERNATIVE to
the fines
Non-monetary
sanction as a tool to
modify MARKET
STRUCTURES,
competition dynamics
and to deter future
wrongdoings
I.3.
GENERAL
PERSPECTIVE

7. INSIGHTS FROM THE
INTERNATIONAL
BENCHMARKING AND
FROM THE BRAZILIAN
EXPERIENCE BETWEEN
2012 AND 2022

8. Analyze the PROPORTIONALITY of the sanction, especially with regard to
the impact on markets directly and indirectly affected by the decision of the
antitrust authority, as well as its socioeconomic consequences.
Previously to its application, doing a MARKET ANALYSIS. By prohibiting
certain companies from participating in biddings, there would not be enough
companies left able to compete for the provision of services, which could
generate adverse impacts on the sector and on the provision of the service
itself.
That sanction could be applied not to all the defendants, but only to the firms
MAINLY INVOLVED, typically referred as the leaders of the cartel.
Item II, Art. 38 Law 12.529/2011 Brazil - Prohibition of contracting
with official financial institutions and the bidder exclusion at all levels
of Brazilian federation (federal, state, municipal and the Federal
District)

9. The DURATION of the sanction could be designed according to the
characteristics of the perpetrated conduct and should not have a standard
application of the maximum time.
Other obligations could be imposed as an ADDITIONAL imposition to
implementing an effective compliance program.
EXTENSION of the prohibition of participation in bids also to companies
in which individuals involved in the previous wrongdoing have any type of
shareholding, managerial role or de facto representatives, so as the penalty is
not bypassed.
Item II, Art. 38 Law 12.529/2011 Brazil - Prohibition of contracting
with official financial institutions and the bidder exclusion at all levels
of Brazilian federation (federal, state, municipal and the Federal
District)

10. Analyze prior to the application the DEGREE OF PARTICIPATION of
the individual and the POSITION occupied by the individual during the
committed wrongdoing.
Project the PROBABILITY OF RECIDIVISM by the individual,
considering the evidence of the case.
Item VI, Art. 38 Law 12.529/2011 Brazil - Prohibition to the individual wrongdoer from
carrying on trade on its own behalf or as a representative of a legal entity for a period of
up to five years

11. Preventing the application in cases where there are no positive OUTCOMES
of the sanction in the market, due to the risk of sounding disproportionate if
questioned by the judicial system.
Preventing the application when the professional disqualification may constitute
a LIFE PENALITY for the individual.
Item VI, Art. 38 Law 12.529/2011 Brazil - Prohibition to the individual
wrongdoer from carrying on trade on its own behalf or as a representative of a
legal entity for a period of up to five years

12. SOME FIRST
CONCLUSIONS

13. Non-monetary sanctions are seen over the years as
COMPLEMENTARY to fines and, by default, applied cumulatively.
Significant focus on the UNDERDETERRENCE perspective and lack
of concerns with OVERDETERRENCE and to a more GENERAL
PERSPECTIVE, i.e., to alter the market structure.
Need to advance in PROPORTIONALITY and REASONING of
the decisions. Need of STRUCTURED AND ORGANIZED
concern regarding the consequences of the imposition of non-
monetary sanctions.

14. Brasília/Brazil
amandaathayde@unb.br
aathayde@pn.com.br
AMANDA ATHAYDE
Compliance and Corporate Crimes
Antitrust
International Trade
https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4282215