Brazilian authorities investigate alleged cartel formation among port pilots

Brazil’s Administrative Council for Economic Defense (Cade) has initiated an inquiry to investigate the alleged formation of a cartel among pilots who earn up to BRL 300,000 per month for docking large ships in Brazilian ports.

These professionals, known as “practicals,” belong to a club now under government regulation. Their hiring is legally mandated, and the Navy oversees their activities.

Cade’s technicians are examining whether there are barriers preventing interested parties from entering this group. They are also investigating whether these pilots engage in market sharing and charge exorbitant prices. In addition, the agribusiness sector has raised concerns about the lack of available professionals and the impossibility of hiring them according to the need, which they believe contributes to price increases.

Many pilots operate as members of the same association, which enters into contracts with various shipowners in the market. Additionally, there is a rotation schedule managed by the maritime authority.

According to Ricardo Falcão, president of the Praticagem do Brasil association, critics are attempting to create the perception that this activity impacts freight prices and, therefore, argue for its complete privatization.

He stated, “The activity cost represents less than 0.1% of the total cargo.” Falcão further claims that the association model is necessary because the individual investment required for a pilot to work independently is prohibitively high. “They would need to purchase a speedboat, safety equipment, and other items the association collectively acquires. The pilot’s compensation comes from their participation in the results, similar to being a shareholder in a company.”

Source: Folha de S. Paulo

To read the original news report, see: https://www1.folha.uol.com.br/colunas/painelsa/2023/05/com-ganhos-de-ate-r-300-mil-valets-de-navios-viram-alvo-de-investigacao-do-cade.shtml

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