Cartel in the Sand Market Gets Fined

The investigation was initiated on June 24, 2019, following a complaint filed against Cooperativa Minera de Productores de Arena y Piedra del Noreste Ltda for alleged anticompetitive practices consisting of coordinating among producers affiliated with the Cooperative the sale prices of fine, medium, and coarse river sand extracted from the river in the Province of Chaco and marketed in areas of Formosa, Salta, and Santiago del Estero.

When arguing their case, the respondents stated that they operated lawfully and denied having engaged in collusive practices, harmed consumers, or carried out actions aimed at eliminating competition. They also argued that the relevant market had been incorrectly defined because sand suppliers, construction supply stores, and hardware stores competed at the same level of the market.

At that stage, one of the affiliated sand suppliers attempted to rely on a de minimis exception based on its limited economic participation. However, the Argentine Competition Authority (ANC) rejected the argument, finding that the minimum thresholds invoked belong to the merger control regime and did not apply to the analysis of collusive conduct. Accordingly, the limited relative weight of a market participant does not, by itself, preclude its potential liability for cartel conduct.

In May 2024, the competition authorities then handling the investigation formally charged the respondents, arguing that the Cooperative holds a monopoly on the price of sand in the alleged geographic market and that the member sand companies sold exclusively through the Cooperative. In that context, it concluded that there was a “centralized marketing system” operating as a vehicle for the cartelization of the sand supply.

In December 2024, and pursuant to article 45 of the Antitrust Law 27442, the Cooperative submitted a commitment to cease the conduct. However, the proposal was rejected because it included neither an acknowledgment of wrongdoing nor a form of compensation for the overcharge that the cartelization had imposed on its customers.

After the defendants’ evidence had been produced, the Competition Tribunal closed the investigation and, on July 29, 2026, issued a decision finding that the Cooperative and its members had engaged in conduct contrary to the Antitrust Law on a continuous basis from 2019 (the year the complaint was filed) until, at least, until May 8, 2024.
 

Accordingly, the Tribunal ordered:

1. the immediate cessation of such competition-restricting conduct;
2. the imposition of fines on the respondents, including the Cooperative and 13 affiliated members that participated in the conduct during the period under investigation, with the highest fine amounting to 240,126 Mobile Units (equivalent to ARS 348,194,706.3 at the time the decision was issued); and
3. the amendment of the Cooperative’s bylaws, rules, and internal regulations, to eliminate those provisions that made price coordination possible.

The Tribunal further noted that, although the Leniency Program applicable to hardcore anticompetitive practices was available, none of the defendants sought its application in this case.

This decision constitutes a milestone in the application of the Antitrust Law, as it is the first cartel sanction imposed through fines expressed in Mobile Units.

In determining the sanction, the Tribunal considered the particularly serious nature of the conduct under investigation, the duration of the practice, its impact on the relevant sand commercialization market, and the harm caused to the competitive process and the general economic interest. However, when setting the fines, the Tribunal also took into account the economic profile of the offenders, given that most of the companies affiliated with the Cooperative were classified as Micro, Small, and Medium-Sized Enterprises and had very few employees, as well as the fact that they operated under adverse conditions due to climatic factors and the COVID-19 pandemic. Taking these circumstances into consideration, the Tribunal decided that the fine should not exceed 10% of each offender’s respective consolidated turnover.

This case is of particular institutional significance because it is the first cartel case decided by the Competition Tribunal and the ANC, while both bodies were fully constituted under the regime established by the Antitrust Law enacted in 2018, following years of delay in its implementation, a situation that was ultimately addressed through Decree 803/2025.