The Commission for the Promotion and Defense of Competition (Coprodec) of Ministry of Economy received this Tuesday at Rural Association (ARU) in the framework of an information meeting regarding the three refrigerators of Marfrig by Minerva where they established positions and the commission presented the processes and procedures that will be carried out in the study of a case that worries the Uruguayan livestock sector.
The ARU had publicly communicated its position against the purchase of the three refrigeration plants of Marfrig by Minerva because more than 60% of the Uruguayan exported meat would become in the hands of the Brazilian company.
With this, the meeting had the objective of clarifying the procedures and processes that will be carried out when studying the case by the Coprodec. After this, the ARU announced that it will appear in the next instance where it will present documents that substantiate its position on this issue.
The role of the Competition Commission
The Commission will have to define legality of purchasing the plants Inaler, Cologne and The Caballada. In that sense, Hector Ferreira, study member Hughes & Hughes and specialist in commercial law, told Radio Carve that in the first instance “the relevant market” should be analyzed, which includes the task and buying and selling livestock.
Then, technicians must “review whether this concentration has the potential to obstruct, limit or restrict competition” and then analyze other elements such as “efficiency gains and what is always the final objective, which is the consumer.” In addition to total approval or rejection, the agency can enable the sale of one or two of the plants, as well as “condition” it.
The position of the ARU
The president of the Rural Association of Uruguay (ARU), Patricio Cortabarría warned that the Brazilian company reached 47% of the task after the acquisition of the Breeders & Packers Uruguay (BPU) meat processing plant and, if this operation is ratified, “the slaughter potential is greater and could reach more than 60% of the meat exported,” he expressed in dialogue with Channel 4, when whitewashing the sector’s concern.
By delving into that position, the head of the ARU argued: “When you let someone become so big, in short, what you are doing is leaving the dominant position to a group or a person with respect, not only to the producers, who are the sellers of those farms, but also to the rest of the industry, that it will be very difficult to compete with a giant within the market itself.”
Source: Ambito
