Legal uncertainty drives surge in M&A filings with Brazil watchdog
Vivian Fraga
Divulgação
Legal uncertainty over Brazil's merger notification rules is prompting companies to report more transactions to the country's antitrust authority, even when many do not appear to raise competition concerns, lawyers say. A survey prepared exclusively for Valor by TozziniFreire Advogados found that M&A filings involving investment funds increased about 40% between 2020 and 2025. The study also found that domestic economic agents conducted about 80% of the transactions, while international agents accounted for 20%.
Experts interviewed by Valor said the 40% increase in Cade filings is largely due to concerns among economic agents that they could be fined for failing to report a transaction to the antitrust authority. They fear a broad interpretation of Cade’s Resolution 33 of 2022, which consolidates the rules governing economic concentration transactions involving both large companies and less complex deals.
Based on the TozziniFreire survey, Vivian Fraga, a partner in the firm’s competition practice and one of those responsible for the study, said the resolution is outdated. In her view, uncertainty surrounding some of its concepts—including the definition of an “economic group”—creates legal uncertainty for economic agents and burdens Cade by generating excessive filings made solely to satisfy formal requirements.
Fraga added that this uncertainty also increases the Brazil Cost—the combination of structural, bureaucratic, and economic obstacles that raises companies’ operating costs in the country.
“Our authority is highly sophisticated and stands alongside the world’s largest and most established jurisdictions,” she said. “Cade’s efforts need to focus on relevant issues, such as regulating the big tech market and combating cartels.”
Fraga said clearer definitions, particularly in cases involving investment funds, control, and economic groups, could have tangible effects on the business environment by providing greater predictability in Cade proceedings.
Cade data shows that notifications of economic concentration transactions have increased overall. In 2024, the authority received 712 filings, of which 680 were approved without restrictions, representing an approval rate of 95.5%. In 2025, the number of reported transactions rose to 873, with 818 approved without restrictions, or 93.7% of the total. The volume of economic concentration filings increased 22.6% between the two years.
Marcel Medon Santos, also a partner in TozziniFreire’s competition practice, said companies tend to notify Cade even when transactions pose no competitive risk because they face severe penalties, including fines of up to R$60 million and the unwinding of the transaction. He also cited a lack of precision in the resolution’s filing rules for companies and funds.
One prominent case that encouraged the increase in filings for this type of transaction arose from CADE members’ interpretation of Resolution 33 in March 2024. At the time, the council found that Jusbrasil’s purchase of shares in Digesto constituted gun jumping—the implementation of an economic concentration transaction before receiving Cade approval.
Cade’s General Superintendence concluded that the transaction should have been reported because a fund with a 20% stake would automatically be considered part of the economic group. Although Cade's Tribunal recognized the violation, it established that the analysis should consider investors’ political and economic rights when determining whether shared control exists, rather than relying solely on the ownership percentage. No fine was ultimately imposed.
In a statement to Valor, Cade said it is working to update Resolution 33. On June 30, it issued Ordinance 263, establishing a new working group to conduct studies for a revision of the regulation.
Beyond the resolution, Rodrigo Rocha Casarotti, a partner in the Financorp practice at /asbz, said the revenue thresholds for mandatory filings are outdated because they have remained in effect since 2012. The requirements apply when one group involved in the transaction has at least R$750 million in revenue and the other has at least R$75 million in revenue.
“Updating the amounts would be consistent with the recommendation of the Organization for Economic Cooperation and Development (OECD), which suggests periodic reviews of these thresholds. In my view, it would also benefit the market and the system by providing a relevance filter for the cases reviewed by Brazilian antitrust authorities,” Casarotti said.
Matheus Venturini, a tax lawyer and partner in the business practice at Rafael Pandolfo Advogados Associados, offered a different view. He said the competition authority has moved away from predominantly formal reviews and begun prioritizing economic reality and investors’ actual capacity to influence transactions. The complexity, he explained, lies in the investment structures currently used by the market.
“Private equity, venture capital, infrastructure funds, and international vehicles frequently adopt governance models that did not exist—or were far less common—when the original rules were conceived,” he said.
When contacted by Valor, Digesto and Jusbrasil had no comment.
Translation: Todd Harkin
