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Design De Contratos Pela Autoridade Antitruste: O Caso Do Mecanismo De Cessação De Práticas Anticompetitivas (Ccp)

Author

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  • Silvinha Pinto Vasconcelos
  • Francisco de Sousa Ramos

Abstract

The cease-and-desist commitment (CCP, a mechanism equivalent to a Consent Decree in the United States) is an agreement between the Administrative Counsel of Concurrence Defense (CADE) and an anticompetitive firm, aiming to cease the investigated practice in a certain period of time. During this agreement, there is a withdraw of the lawsuit. If the firm hasn't been respected the CCP, fines and reputation sanctions can be applied. Considering that the CCP utilization is still new in Brazil as well the literature about the theme, the objective of this paper is to analyze the conditions for a firm make a CCP, in a game with incomplete information. The results indicate that: the firms should follow the CCP as bigger were the loss of reputation and fines, and smaller the infraction profits against the normal profits; the antitrust authority should offer the CCP when the benefits of this proposal were bigger than the losing of the firm; the antitrust authority should offer the CCP when there is a belief that the firm is low cost type.

Suggested Citation

  • Silvinha Pinto Vasconcelos & Francisco de Sousa Ramos, 2005. "Design De Contratos Pela Autoridade Antitruste: O Caso Do Mecanismo De Cessação De Práticas Anticompetitivas (Ccp)," Anais do XXXIII Encontro Nacional de Economia [Proceedings of the 33rd Brazilian Economics Meeting] 094, ANPEC - Associação Nacional dos Centros de Pós-Graduação em Economia [Brazilian Association of Graduate Programs in Economics].
    • Handle: RePEc:anp:en2005:094
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    File URL: http://www.anpec.org.br/encontro2005/artigos/A05A094.pdf
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    References listed on IDEAS

    as
    1. Posner, Richard A. & Rasmusen, Eric B., 1999. "Creating and enforcing norms, with special reference to sanctions1," International Review of Law and Economics, Elsevier, vol. 19(3), pages 369-382, September.
    2. Posner, R.A. & Rasmusen, E., 1998. "Creating and Enforcing Norms, with Special Reference to Sanctions," Papers 98-005, Indiana - Center for Econometric Model Research.
    3. Paolo Buccirossi & Giancarlo Spagnolo, 2000. "Counterproductive Leniency Programs Against Corruption," Econometric Society World Congress 2000 Contributed Papers 1311, Econometric Society.
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    More about this item

    JEL classification:

    • L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation
    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games

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