ANP appeals approval of Gaspetro sale to Compass

Brazilian oil and gas regulator ANP has appealed the antitrust agency Cade's decision that allowed the sale of Petrobras gas distribution subsidiary Gaspetro to gas trading company Compass.

In a 23 March decision, ANP's directors asked Cade's general superintendent to bring the Cade approval before a special jury at Cade. ANP's technical review of the transaction concluded the Gaspetro sale would be detrimental for the competition at the gas market in the country.

This is not the first appeal on the case presented to Cade. Natural gas buyers and industry participants, represented by industry advocacy groups, have asked that the case be heard by a special jury at Cade. And Cade judge Lenisa Rodrigues Prado on 24 March referred the case to the Cade jury, saying that completing the transaction "potentially transfers a near-to-monopolistic position to a new player — Compass and Cosan group," violating the agreement that Petrobras signed with the competition watchdog.

Cade's general superintendent's decision allowing the sale admitted that it would lead to a concentration at the gas purchasing in the country, but it said that eventual competition problems could be solved by ANP through regulatory actions.

The request from ANP for the Cade jury to review the decision shows that ANP disagrees and does not believe that regulation will be able to protect competition.

A panel of Cade judges known as the board of counselors will now consider whether to impose remedies and limitations on the transaction.

The committee in charge of Brazil's gas market liberalization, headed by the ministry of mines and energy, previously indicated that the purchase's approval may work against competition, putting around 60pc of all gas purchases in Brazil in Compass' hands.

Gaspetro has shares in 18 natural gas distribution companies, is partnered with state governments as well as Japanese company Mitsui.

By Flávia Pierry