Cade files investigation procedures on the acquisitions of the Botafogo and Cruzeiro SAFs

The General Superintendence of the Administrative Council for Economic Defense (SG/Where) filed the administrative proceedings for the Determination of the Act of Concentration (APAC) in the purchase of shares in Sociedades Anônimas do Futebol (Soccer Corporations) (SAFs) of cruise and Botafogo.

The opening of the proceedings had taken place in August and, according to Cade, sought to determine “if there was a consummation of a concentration act before the approval of the autarchy, an anti-competitive practice known as gun jumping”.

The Botafogo SAF had 80% of its shares acquired by Eagle Holdings, a John Textor – then rising to 90%, after the (already foreseen) non-payment of the bridge loan. SAF do Cruzeiro, on the other hand, had 90% of the shares purchased by Tara Sports Brasil, from Grupo R9, from Ronaldo Phenomenon.

Check out Cade’s note:

The General Superintendence of the Administrative Council for Economic Defense (SG/Cade) decided to shelve the administrative procedures for the Determination of the Act of Concentration (APAC) in the purchase of shares in Cruzeiro Esporte Clube SAF by Tara Sports Brasil, from Grupo R9; and in the purchase of shares of SAFBotafogo by Eagle Holding.

The establishment of administrative procedures to determine whether there was a consummation of a concentration act before the approval of the autarchy, an anti-competitive practice known as gun jumping, took place in August of this year.

In its opinions, in both cases the SG verified that the economic groups involved in the operations of the Societies Anonymous de Futebol (SAFs) did not reach the minimum invoicing criteria stipulated in article 88 of Law 12.529/2011, not representing mandatory notification of an act of concentration.

As for the strictly competitive analysis, no horizontal overlaps arising from the operations were found. The groups that acquired Cruzeiro SAF and Botafogo SAF (Grupo R9 and Grupo Eagle, respectively) did not have investments in companies headquartered in Brazil that competed with the SAFs. That is, companies whose main activity was the practice of football in professional competition.

Football Corporations

The SAFs Law, Law nº 14.193/2021, allowed clubs to establish a new legal regime, from the transformation of the club itself (or the spin-off of the club’s football department) into a business company with its own CNPJ. Once the company is constituted, shares of this SAF may be issued, which, in turn, may be sold to individuals, corporations or investment funds – which would take control of the football of a given club.

When becoming companies (in the SAFs model), football clubs start to present societal dynamics similar to other business businesses. In this sense, operations involving these companies become liable to constitute acts of concentration and must also be subject to typical corporate regulations, such as the control of structures carried out by CADE.

Access process nº 08700.003312/2022-11 (Cruzeiro SAF and Tara Sports)

Access process nº 08700.003313/2022-58 (Botafogo SAF and Eagle Holding)

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