Horizontal price fixing and boycott by a customhouse brokers association

MEXICO, 1999

A customhouse broker filed a complaint against the Regional Association of customhouse brokers in Queretaro (AAAQ), alleging price fixing for the validation of customs papers and access denial in the provision of this service. The plaintiff charged a rate ranging from 45 to 70 pesos per validation services, thus failing to comply with the 20 additional pesos rate agreed by the members of the AAAQ. Following the AAAQ� internal regulations, the plaintiff was expelled from this association. In turn, the national customhouse broker association (CAAAREM) supported the AAAQ� decision requiring its members to refrain from dealing with the plaintiff. The AAAQ price agreement constituted an absolute monopolistic practice and the CAAAREM� boycott against the plaintiff was in violation to the FLEC.

Facing these facts, the responsible parties consented (under article 41 of the RFLEC) before the FCC to re-establish competition conditions by: (i) restoring the plaintiff� access to AAAQ validation services and (ii) the commitment of CAAAREM� members to deal with non associated customhouse brokers. In turn the FCC ordered the responsible parties to eliminate the association� rule that provides for the removal of members for not matching the suggested tariffs. Furthermore, the FCC required the CAAAREM to inform its members that they were free to set rates independently.

The FCC fined each responsible party. These sanctions were challenged through the filing of an appeal for review. Both AAAQ and CAAAREM argued that the amount of the fine was excessive, given their compliance with FCC orders. In its final decision the FCC agreed to reduce the sanctions.