Game Theory Applied To The Brazilian Antitrust Leniency Program

The Brazilian Antitrust Law established the Administrative Council for Economic Defence (CADE) as the body responsible for investigating and imposing sanctions for acts that violate the economic order, as well as for supervising acts of economic concentration. The field of game theory is concerned with the actions of decision-makers who are aware that their decisions affect one another. The objective of the proposed article is to analyse the legal framework of the Leniency Programme implemented by Brazil's Administrative Council for Economic Defence (CADE) using the tools provided by game theory, in particular sequential games with perfect information. The methodology employed is classified as theoretical research, utilising the deductive method with the objective of enhancing the proposed theme. In order to achieve this, two game models will be developed. Initially, it was observed that the benefits offered by the current Brazilian leniency programme are insufficient to persuade a potential cartel member to propose a leniency agreement. Conversely, in a second step, the introduction of immunity for applicants from civil damages caused by the cartel resulted in the conclusion that the Brazilian antitrust leniency programme becomes an important tool for deterring and combating cartels. KEYWORDS: Antitrust Law. Cartel. Game theory. Leniency. Sequential games.