Price fixing by Canc Customs Agents Association

Mexico

On August 21, 1995, the Commission began an ex officio investigation into alleged absolute monopolistic practices by the members of the Cancun Customs Agents Association (AAAC). The Commission had previously been informed that the association's members were fixing prices for the services they provide.

In recent years, the legal framework applicable to customs brokerage services has undergone major deregulation, most notably through increased openness towards competition. Clear non-discriminatory rules were established for the granting of customs licenses. Furthermore, in July 1993 the official rates set by the Secretariat of Finance and Public Credit were abolished. Thus, customs agents were free to directly negotiate their fees with users.

In these new circumstances, improved efficiency and better price-quality ratios in the services provided depend basically on the preservation of competition and free market access conditions- in other words, on preventing and eliminating anticompetitive practices. However, the collusion agreed upon by the AAAC at its meeting held on February 16, 1995 may be partially explained by the inertia leading to the application of uniform rates, based on the criteria in use in the past. This meeting agreed to establish: A minimum charge of 1% on total foreign trade taxes, other levies, and costs incurred by the customsc agency. A $300 fee for complementary services.

The agreement also stipulated sanctions for members who failed to observe its terms. Apparently, these were not applied, in spite of the failure of certain customs agents to respect the agreement.

The Commission's investigations verified these facts and, consequently, the existence of an absolute monopolistic practice involving collusion between competing economic agents with the aim of fixing the sales price of the services offered by the AAAC's members. This behavior, described in section I of article 9 of the competition law, is forbidden by its article 8. The damage caused to competition and society by practices of this kind cannot be justified on the grounds of efficiency. The aim is clear: to neutralize users' bargaining power. In this case, since the use of customs agents' services was obligatory, the adverse effects of the agreement could not be avoided by exporters and importers, and thus the country's foreign trade was compromised.

Based on the evidence obtained and the comments appearing above, the Plenary resolved:

To fine the AAAC. To order AAAC to refrain from the practice, revoke the fee agreement, and inform all its members about this resolution and the risks inherent in a repeat offense. To give notice of its resolution to the Confederaci鏮 de Asociaciones de Agentes Aduanales de la Republica Mexicana (CAAAREM), the national umbrella organization for local customs agents' associations.