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Today, the Administrative Council for Economic Defense (CADE), Brazil’s antitrust authority, issued a statement challenging the AT&T-Time Warner merger. CADE contends that the transaction as proposed should be rejected unless the companies agree to changes that may include asset sales. The recommendations did not specify what properties might need to be divested to prevent the two companies from sharing information that could lead to increased prices for consumers. CADE’s board is expected to issue a final decision by late November.
The following can be attributed to Gus Rossi, Global Policy Director at Public Knowledge:
“We applaud Brazil’s antitrust authority, CADE, for challenging the AT&T-Time Warner merger based on the competitive dangers to Brazilian consumers. We agree with the agency’s concern that a concentrated marketplace would enable the merged companies to drive up prices for video and broadband services. We also share CADE’s fear that the new entity would have both the capacity and incentive to discriminate against competitors and coordinate with other dominant providers to harm the competitive process.
“We believe CADE’s statement reinforces U.S. consumer concerns presented to the Department of Justice and should help convince them to reject the merger in the United States.”
For more information on the AT&T-Time Warner merger, please view our testimony here.