MP-MS wants millionaire compensation from distributors for vertical integration

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The Public Ministry of Mato Grosso do Sul asked to join as a party in two actions that accuse two distributors of verticalization of prices in fuel distribution. Because of the anti-competitive practice, the MP-MS asks that companies be ordered to pay more than R$600 million in collective moral damages.


Verticalization occurs when two or more companies, usually a distributor and a few retailers, combine exclusivity agreements that harm competition.

The actions in which the MP intends to join B2B Lead as a party were proposed by the Sul-Mato-Grossense Association of Fuel Resellers and Related Activities (Assumpetro) and DI Comércio de Combustíveis, both represented by lawyer  Danny Fabrício Cabral Gomes , partner at Cabral Gomes & Thronicke Associated lawyers.

Assumpetro accuses Taurus Distribuidora de Petróleo of verticalization. According to the action, the company sells fuel at a cheaper price to some stations, including some that are owned by the same owners as Taurus.

In the action, the association asked that the company sell the fuel at the same price to all distributors and asked that the company not carry out "persecutions" against the companies that make up Assumpetro.

The MP-MS asked that Taurus be ordered to pay R$25 million in compensation for collective moral damages. "By using the practice of verticalization with negative effects on economic well-being, the defendant company exposed society to harm, affecting consumers in general in a diffuse way", says the Public Ministry.

The other action, filed by DI Comércio de Combustíveis, accuses Raízen of anti-competitive practices by integrating with a network of gas stations, charging lower prices in the market. Licensee of the Shell brand, Raízen would be harming other stations under the same brand, says the company, which accused the distributor of "canbalizing its own network".

In this case, the MP-MS asks that Raízen be sentenced to R$610 million in compensation for collective moral damages, which according to the Public Ministry corresponds to approximately 1% of the company's annual revenue.



"The value noted considers that the amount of compensation for moral damages involving a consumer relationship has the punitive and preventive criteria as preponderant. Such criteria must, in effect, override the compensatory criterion. The treatment given to moral damage resulting from consumer relationship is different from that arising from a private and civil relationship", explained the MP-MS.