Any conduct with the potential to restrain, distort, or harm competition shall constitute an antitrust violation, irrespective of whether such effects are realized and regardless of the wrongdoer’s intent. Among the actions that may constitute antitrust violations are explicit or tacit agreements between competitors to fix prices or allocate markets, exchange of competitively sensitive information, price discrimination, and resale price maintenance.

The duty to compensate is imposed on those who violate the rights or cause harm to others. To bring a lawsuit, the claimant must demonstrate (i) the offender’s conduct, (ii) the occurrence of damage, and (iii) the causal link between the infringing conduct and the damage.

Article 47 of the Brazilian Competition Act (Law No. 12,529/2011) empowers anyone who has suffered the consequences – typically customers or competitors of the wrongdoer – of antitrust violations to seek redress for damages in civil lawsuits brought before the Brazilian courts. Such lawsuits may also be initiated by third parties legally authorized to act in the public interest, including (a) the Public Prosecutor’s Office; (b) representatives of the Federal Government, the States, Municipalities, and the Federal District; (c) agencies and entities directly or indirectly connected to the public administration, especially those aimed at defending consumer rights; and (d) associations that have been in operation for at least one year and whose institutional goals include the defence of consumer interests and rights.

Claimants may seek compensation for both monetary and moral damages, in addition to obtaining injunctive relief to halt the illegal conduct. Monetary damage refers to the loss incurred to a person’s assets, encompassing the loss of goods or items with economic value. Conversely, moral damage pertains to the violation of an individual’s honour or image, resulting from an offense against personality rights, such as intimacy, privacy, honour, and image.

Brazilian law stipulates that the aggrieved party is entitled to full indemnification for damages. This includes monetary damages arising from actual losses incurred (emergent damages) and the amounts a person can no longer receive (loss of profits). If monetary damages result from cartel violations, those affected will be entitled to double compensation for the losses without prejudice to sanctions imposed in administrative and criminal proceedings.

Article 942 of the Brazilian Civil Code establishes that liability for illicit acts is joint and several. Therefore, each party involved in a conspiracy is fully responsible for paying all damages resulting from the conspiracy. As a result, the aggrieved party or the third parties mentioned above may choose to bring civil suits against all parties to the conspiracy or against only one or some of the wrongdoers.

If the aggrieved party is fully compensated by one of the wrongdoers, they may not seek further compensation from the other wrongdoers. This is because, under Brazilian law, the payment of the entire debt by one of the jointly liable debtors releases the remaining co-debtors from the obligation. However, the wrongdoer who compensated the aggrieved party may seek contribution for the damages paid from other parties to the conspiracy. If the aggrieved party is only partially compensated by one of the parties to the conspiracy, they may claim the balance from the other wrongdoers, deducting the amount already received.

The signatories of a leniency agreement or a cease-and-desist agreement are only responsible for the damage they caused to the injured parties. They are not subject to double compensation for the damage caused, nor are they jointly and severally liable for the damage caused by other perpetrators of anticompetitive practices.

The statute of limitations for claims for compensation for damages caused by violations of the competition order is five years, starting from the “unequivocal knowledge of the illicit act”. Unequivocal knowledge of the offense is considered to occur upon CADE’s publication of the final judgment of the administrative investigation. The statute of limitations will not run during the investigation or administrative investigation within the scope of CADE.

The rules of territorial and material jurisdiction are defined in the Brazilian Code of Civil Procedure (Law No. 13,105/2015), which provides that lawsuits seeking compensation for damages must be brought before the venue with jurisdiction over the location of the act or fact giving rise to the damages. When damages are caused to the federal government or a federal state-owned company, the lawsuit must be filed in federal court. All other cases must be filed in state court.

Brazilian courts can handle lawsuits if any of the following conditions are met: (a) the defendant lives or has offices in Brazil; (b) the obligation or duty that is being disputed must be carried out in Brazil; or (c) the lawsuit is based on events or actions that took place in Brazil. Internal jurisdiction, which determines which specific court within Brazil will hear the case, follows the rules in the Code of Civil Procedure (see section 5 above). It considers the location where the events that caused the damage occurred.

Brazilian law applies to events occurring in Brazil or involving companies located in the country, as explained in section 6 above. Brazil has adopted the system of rational persuasion for assessing evidence, also known as the system of free-motivated conviction, whereby the judge is free to form his conviction by weighing the evidentiary elements collected in the case records, provided he presents the grounds of fact and law.

The civil, criminal, and administrative jurisdictions are independent and autonomous, meaning that decisions made in one sphere do not bind the others. Consequently, as a rule, a condemnatory decision by the administrative authority is not sufficient to impose an obligation to pay civil compensation. However, a 2022 legislative amendment introduced a provision allowing CADE’s final decision to substantiate the granting of injunctive relief, enabling the judge to issue provisional rulings in related actions.

As explained in section 8, the civil and administrative jurisdictions are independent. This means a private damages action can proceed even while a public enforcement action is pending. There is no legal provision allowing enforcement authorities to suspend a private action while a public enforcement action is pending.

Class actions may be initiated by third parties legally authorized to act in the public interest, including: (a) the Public Prosecutor’s Office; (b) representatives of the Federal Government, States, Municipalities, and the Federal District; (c) agencies and entities directly or indirectly connected to the public administration, particularly those focused on defending consumer rights; and (d) associations that have been operational for at least one year and whose institutional goals include the defence of consumer interests and rights.

A successful claim benefits all members of the group, class, or category affected by the violation of rights. Any member of this group may rely on the favourable judgment to pursue compensation through individual liquidation proceedings, but they also have the option to file a separate individual compensatory claim. A decision denying the claim should not prejudice third parties and does not preclude the initiation of a new class action.

Brazilian law generally imposes on each party the burden of proving its allegations. While a defence based on the pass-on of losses resulting from an antitrust infringement is possible, the Brazilian Competition Act requires the defendant to prove that the aggrieved party has increased the price of its products or services sold to its customers at the downstream market-level.

The Brazilian Code of Civil Procedure provides that the judge will be assisted by a court-appointed expert when the evidence of a fact requires technical or scientific knowledge. Court-appointed experts are selected from among legally qualified professionals and technical or scientific bodies duly registered in a registry maintained by the court. The parties may also hire experts to prepare technical questions or materials for the court-appointed expert. When the court-appointed expert submits their report, specialists employed by the parties can assist in refuting or commenting on the conclusions of the court-appointed expert. The judge shall deny the production of expert evidence when: (i) proving the fact does not require special technical knowledge; (ii) it is unnecessary in light of other evidence produced; or (iii) verification of the fact is impracticable.

In Brazil, the trial process is presided over by the competent judge and comprises five distinct phases. In the first phase, the plaintiff formalizes their claim and presents documentary evidence to substantiate their right. The subsequent phase is defence, during which the defendant presents their defence and counterevidence. The third phase, the evidentiary phase, involves the judge analysing the evidence submitted by the parties and potentially ordering the collection of additional information if deemed necessary. This phase may include hearings for testimony and expert assessments. The following is the decision phase, where the judge reviews all facts and evidence, applies the relevant law, and issues a final decision. If either party disagrees with the judgment, they may appeal to a higher court. This will be the appeal phase.

There are no specific public statistics for damages claims in antitrust cases. In general, a lawsuit for damages can take up to three years to reach a judgment. The appeal phase typically takes longer and may extend up to 10 years before a final judgment is rendered.

See question 4 above.

In Brazil, compensation is measured by the extent of the damage, which the aggrieved party must demonstrate. As previously explained (see section 3 above), damages caused by cartels give rise to double compensation. The extent of the damage is typically determined through expert evidence, which considers financial information and documents to establish the loss caused by overpricing. It is not uncommon for experts to use counterfactual scenarios to infer the damage, comparing the prices charged with those that would have been expected had the competition infringement not occurred. There is still no record of lawsuits involving “umbrella effects” in Brazil.

Compensation must be adjusted for monetary correction and interest. Brazilian courts have established that interest and monetary correction accrue from the date of the harmful event in cases of monetary damages , while the compensation for moral damages must be monetarily updated from the date it is determined by court decision.

As explained in question 4 above, liability for illicit acts is joint and several. If the aggrieved party is fully compensated, the wrongdoer who provided the compensation may seek contribution for the damages paid from other parties to the conspiracy.

The case may be dismissed early if the legal and procedural requirements necessary for filing and processing the claim are not met and if the claimant fails to correct the identified defects within the stipulated time. Another reason a competition damages claim may be resolved without a full trial is if it is settled out of court by the parties involved. If the parties reach an agreement, it must be approved by the competent court to conclude the legal action.

Defendants in class actions seeking redress for damages caused by anticompetitive practices may enter into a Conduct Adjustment Agreement, which obligates the signatory to cease the harmful conduct and to compensate the community and individuals for damages. Noncompliance with the conditions outlined in the agreement may result in penalties and the continuation of further class actions on the same matter.

Brazilian courts may classify sensitive documents or entire case files as confidential. Only the parties directly involved in the dispute are granted access to the documents in such instances. The undue disclosure of this material may constitute a breach of judicial secrecy, a crime punishable by fines and imprisonment. It may also subject the responsible party to compensation for any resulting damages.

Documents produced during CADE’s administrative investigations may also be treated confidentially, with access limited to the parties involved in the proceedings. However, there are precedents in which courts have authorized third parties to access the full confidential agreements entered into with CADE after the Brazilian competition authority has issued its final decision.

The losing party is required to reimburse the prevailing party for court costs, including filing fees, expert fees, and other related expenses. Additionally, the losing party must pay the prevailing party’s attorneys’ fees, which are typically set between 10% and 20% of the case’s value.

Third-party funding of damages claims is not a prevalent practice in Brazil. The absence of specific regulations on the matter may lead to uncertainties regarding its legality, potentially likening it to the predatory litigation that Brazilian courts seek to combat. That said, the practice is not expressly prohibited by any rule, leaving room for potential use within the legal framework. Meanwhile, lawyers in Brazil are authorized to work based on contingency or conditional fees, a practice that is quite common.

The primary obstacles to the proliferation of actions seeking redress for damages caused by antitrust violations in Brazil have historically been the uncertainty surrounding the commencement of the limitation period and the challenges in producing evidence of the damages resulting from unlawful conduct. Legislative amendments introduced in 2022 aimed to address these issues, to encourage and facilitate the filing of claims by parties harmed by anticompetitive practices. The new rules clarified the starting point of the limitation period, introduced the possibility of double compensation for damages, and eased the burden of proof by shifting the obligation to the defendant to demonstrate that the losses were passed on to third parties (“pass-on defence”). Additionally, the reforms allowed for the issuance of preliminary decisions based on CADE’s administrative rulings.

Another factor hindering the proliferation of such actions is the lack of awareness among companies and individuals regarding the detrimental effects of competition violations. This lack of understanding often leads to insufficient recognition of the damages incurred due to unlawful conduct. Despite the ongoing efforts of competition authorities, this issue remains insufficiently acknowledged. Finally, the protracted duration of legal proceedings and the costs associated with hiring specialists contribute to diminishing the interest of potential claimants.

The 2022 legislative changes are still relatively new, and their impact should become more evident with increased investigative efforts by CADE and a resurgence in the number of convictions. In this regard, enhanced clarity regarding limitation periods and reversing the burden of proof in cases involving pass-on defences address or mitigate the primary procedural challenges associated with initiating new lawsuits.