*Originally published in Conjur.

**This is an AI-powered machine translation of the original text in Portuguese.

Public Hearing and the Selection of Participants by CADE

On February 19, the Administrative Council for Economic Defense (CADE) held a public hearing on the “competitive aspects of the digital ecosystems in which mobile operating systems are embedded,” in the context of ongoing investigations into the conduct of Google and Apple within their Android and iOS systems. These investigations focus on the following practices: (1) imposition of proprietary payment methods (Google Play Billing and Apple Pay) for in-app purchases and commission charges; (2) anti-steering rules prohibiting user redirection to services or purchases outside the ecosystem; and (3) in Apple’s case, the imposition of the App Store as the sole app distribution option, prohibiting sideloading.

This is an unprecedented procedure for the agency. CADE has previously held public hearings to discuss the general characteristics of certain markets, anti-competitive practices, or investigative methods. It also holds closed hearings with the parties involved, focused on the specificities of each case. However, this is the first time it has held a public hearing open to any interested party and accessible to the general public to debate the practices of specific companies within the scope of ongoing investigations—cases which were even mentioned in the call for participation.

It is worth noting that this innovation came in a context where CADE seeks to apply a controversial measure in one of these investigations. In the case against Apple, CADE imposed a precautionary measure prohibiting the company from enforcing certain App Store rules and requiring it to open iOS to allow sideloading in Brazil [1]. The measure was suspended by the Federal Court of Appeals (TRF-1) due to technical and business model changes considered disproportionate and inadequate for an urgent remedy [2]. CADE appealed and successfully reinstated the precautionary measure [3].

Regarding the call for participation, there were 30 applications, and 16 entities were selected for the hearing [4], including 9 companies or trade associations directly involved in the matters discussed [5] and 7 representatives from academia or civil society [6]. An analysis of the 30 submissions reveals that 13 were clearly in favor of CADE's intervention in digital ecosystems [7]; 8 were clearly opposed [8]; and 9 adopted a neutral stance, addressing potential negative impacts and economic justifications for the practices [9]. Among the selected academia and civil society representatives, nearly all were entities actively engaged in opposing various aspects of large digital platforms, such as the concentration of informational power, privacy risks, discrimination, political polarization, and disinformation, and submitted written statements supporting intervention [10].

Although the concentration of critical statements during the public hearing served to highlight the risks of the practices under scrutiny, it is important to balance this by evaluating potential business justifications, economic rationales, and positive effects for the market and consumers, in order to foster a comprehensive debate. After all, the public nature of the hearing reinforces CADE’s role as an advocate for competition, which entails promoting a plural and democratic debate, with diverse voices from civil society—whether opposing, supportive, or neutral regarding CADE's own investigative stance. In other words, CADE as an investigator holds fact-finding hearings to gather evidence of potential violations and defends its positions in court, but CADE as a competition advocate contributes to society and other public bodies by fostering a culture of competition.

It is worth summarizing the positions and arguments against the practices of mobile operating systems in app distribution and payment methods, as well as the economic justifications and potential consumer benefits, based on all contributions submitted to CADE, to provide broader access to civil society’s perspectives, not just those who participated in the public hearing.

Analysis of the Submitted Statements

In general, the arguments in favor of intervention are based on the premise of Google’s and Apple’s market power within digital ecosystems, pointing to competitive imbalances, monopolistic rent extraction, and space for anti-competitive abuses. Their dominance was noted in areas such as digital advertising, mobile payment systems (Zetta argued that Apple’s closed system blocks access to proximity payment technology for developers, favoring Apple Pay and hindering the use of Pix on iOS), and user security (FS Security argued that Apple and Google have centralized control over critical device functions, creating barriers in the cybersecurity market; EFF stated that this control creates a “security monoculture,” where failures from one company can impact others and consumers).

Some entities advocated for structural remedies to address the perceived problems. The Centre for Research on Multinational Corporations (SOMO) and the Coalition for App Fairness argued that antitrust intervention would promote innovation, with SOMO even proposing drastic measures such as corporate breakups. Data Privacy advocated for remedies related to data processing to mitigate market power, such as data silos (preventing data sharing across a company’s services), bans on setting their own services as defaults, mandatory sharing of raw data with competitors, among others. Mobile carriers also called for intervention on default-settings and limits on commissions charged by Google and Apple to developers.

On the other hand, the arguments against intervention highlighted potential efficiencies in the companies’ business models, as well as risks of overregulation and ex ante rules. Apple defended its investments in security and privacy, arguing that CADE should prioritize user interests and avoid copying regulatory models from other jurisdictions, such as the DMA [11] and ex ante regimes more generally, which would harm innovation and security (especially with requirements like sideloading and interoperability). Google, in short, argued that intervention is unnecessary due to intense competition between Android and iOS and the benefits of its open model, such as the flexibility introduced by its licensable OS. Android’s features were also highlighted by other stakeholders like the Developers Alliance, Positivo, Grupo Multi, and Aoca Game Lab. They emphasized factors like Android’s cost-free use by the majority of developers (the 97% that do not generate in-app transactions), the presence of pre-installed apps, and other elements that facilitate competition among smaller manufacturers and developers.

Finally, neutral contributions raised important factors for technical analysis and understanding of the practices.

In the payments sector, the Central Bank of Brazil and Febraban called for balanced regulation, taking into account innovation, security, and data protection. Both described successful partnerships with Google to combat theft and fraud. At the same time, they argued for the need for iOS interoperability to reduce entry barriers and enable proximity Pix on iPhones without transferring the cost to users via card issuer fees.

Regarding the adoption of ex ante rules or DMA-inspired interventions, Vaic.at and the Chamber of Progress pointed to negative effects from these regulations (weakened security, developer instability, and worsened user experience), but still supported intervention in digital ecosystems, provided it aims to promote innovation by enabling small businesses to access global digital markets without excessive regulatory barriers, and focuses on existing ex post conduct regulations. Similarly, the Brazilian Association for Economic Freedom (ABLE) highlighted the impacts of regulation, stating that CADE should base any intervention on empirical evidence. ABLE supported regulation that encourages interoperability and open standards, as adopted by the DMA, but warned that impact assessments should be more cautious, even considering behavioral economics research. Among its recommendations, it suggested merger monitoring in digital markets, incentives for algorithmic transparency, and the creation of a dedicated research department at CADE.

Representatives from the European Commission’s Joint Research Centre and the University of Glasgow presented antitrust methods tailored to digital ecosystems. They argued that traditional methods are insufficient to capture ecosystem-specific dynamics such as companies being both competitors and cooperators, pressures from potential competitors in different markets, and interconnections through complementarity and shared user bases. They proposed that CADE define markets using factorial analysis and the Snowball Selection method (a process that structures ecosystems around a mobile operating system to identify products and services with direct consumer welfare impacts).

Finally, the application of competition law in these ecosystems was analyzed by the Legal Grounds Institute. First, inter-ecosystem relations (between Apple and Google) were examined, concluding that the complexity of OS chains requires acknowledging competitive pressures between the two firms in defining relevant markets. Then, intra-ecosystem relations (between orchestrators like Apple and Google and orchestrated actors like developers) were analyzed using an analogy with previously adjudicated radius clauses in shopping malls. Since the main practices under scrutiny in digital ecosystems involve key trade-offs between developer/consumer freedom and security/privacy, the Institute emphasized that antitrust interventions in these cases are highly risky. Lastly, it addressed the control of commissions or pricing, stating that exploitative abuse is a concept foreign to CADE's tradition.

CADE’s initiative yielded a valuable experience, capable of enriching the debate, even though unfortunately many contributions were not made visible during the public hearing.

Footnotes

[1] Administrative Process Opening Order No. 24/2024 in Case No. 08700.009531/2022-04.
[2] Decision in Writ of Mandamus No. 1097967-08.2024.4.01.3400, TRF-1.
[3] Decision in Interlocutory Appeal No. 1004244-13.2025.4.01.0000, TRF-1.
[4] There are 30 written submissions in the file made available by CADE in Case No. 08700.001047/2025-71 (Document No. SEI 1520733). Written submissions were a requirement for participation in the hearing, although three entities (IDEC, Match Group, and Coalizão Direitos na Rede) spoke without written submissions in the file, as noted in the Dispatch on selection criteria (Document No. SEI 1523682).
[5] Apple, Google, Mercado Livre, Epic Games, FS Security, Match Group, Zetta, ABRANET, and Coalition for App Fairness.
[6] Coalizão Direitos na Rede, Article 19, Euroconsumers Brasil and Proteste (Brazilian Consumer Defense Association), IDEC, Data Privacy, Sleeping Giants Brasil, FGV – Direito Rio, and the European Commission Research Centre and University of Glasgow.
[7] Browser Choice Alliance, Coalition for App Fairness, Electronic Frontier Foundation (EFF), Centre for Research on Multinational Corporations (SOMO), Zetta, FGV, Article 19, Proteste-Euroconsumers, FS Security, Sleeping Giants, ABERIMEST, Data Privacy, and Mercado Livre (representative in the case against Apple).
[8] Apple, Google, Developers Alliance, Positivo, International Center for Law & Economics (ICLE), Grupo Multi, AOCA Games Lab, and The App Association.
[9] Central Bank of Brazil, FEBRABAN, European Commission Research Centre and University of Glasgow, Legal Grounds, ABLE, Conselho Digital, Vaic.at, Telma, and Chamber of Progress.
[10] Except for the European Commission Research Centre and University of Glasgow, classified as neutral for focusing on technical contributions regarding market definition in ecosystems.
[11] European Union, Digital Markets Act (Regulation (EU) 2022/1925).