ECUADOR: An Introduction to Competition/Antitrust
Expected Competition/Antitrust Developments in Ecuador
The new head of the Competition Superintendence (Superintendencia de Competencia Económica), or the national competition authority, was appointed in September 2024. During the first year of this new administration, the Superintendence has mostly maintained the institution’s traditional focus on unfair competition and merger control matters, while relevant cartel and abuse of dominance cases remain rare.
Nonetheless, with the initiation of a few novel investigations in the latter of these two areas, it is possible that the Ecuadorian authority may start moving in a new direction. The disproportionate importance of unfair competition cases (as opposed to antitrust behavioural matters) has been consistently criticised by national and international commentators since the inception of the national antitrust regime more than a decade ago.
On 5 May 2025, the National Assembly (in the Ecuadorian parliament) approved a new Organic Law for the Regulation of Unfair Competition (Unfair Competition Law). This new legislation will only come into force after new parliamentary proceedings required for the debate of several modifications are introduced by the President of the Republic in use of his veto powers. Perhaps the most relevant of such modifications is the reduction of the maximum level of fines (equivalent to 10% of the gross annual revenue of the infringing undertakings), as set forth in the original bill. These fines were deemed to be disproportionate and therefore unconstitutional.
The new Unfair Competition Law will give ordinary civil courts jurisdiction to hear unfair competition disputes (but not antitrust cases proper), which is likely to cause an uptick in litigation once the system is decentralised. However, the Competition Superintendence will also retain jurisdiction to hear unfair competition cases, along with civil courts. It is expected, and very much desired by local practitioners and international experts, that this reform will allow the competition authority to further specialise and focus on tackling the pervasive cartels and monopolies that plague the Ecuadorian economy.
Another interesting development, not just relevant to Ecuador but to the entire Andean Community (integrated by Colombia, Ecuador, Peru and Bolivia), is the culmination of the decade-long tissue paper cartel saga. This is the first cartel case heard and decided by the Andean regional institutions. Andean Community competition law forbids price-fixing agreements with inter-state effects, much the same way EU competition law.
Between 2013 and 2015, the competition authorities of Ecuador, Colombia, and Peru initiated investigations into several companies in the paper industry for the possible existence of a cartel to fix sales prices in the soft or tissue paper market. In the course of these investigations, the two relevant manufacturing companies requested to participate in a leniency programme with the Superintendence of Industry and Commerce of Colombia, as well as with the National Institute for the Defence of Competition and the Protection of Intellectual Property of Peru. Both bodies determined the existence of a price cartel and sanctioned the companies involved with fines. However, in the case of Ecuador, despite Kimberly Clark’s request to benefit from leniency, the Competition Superintendence decided to close the investigation without bringing charges due to lack of merit. After closing the investigation, the Superintendence forwarded the factual information to the SGCAN, requesting the Andean authority to initiate an investigation.
It will be of great interest to the corporations, governments and practitioners to see further developments in Andean Community competition law. Like in other regional integration projects, further development of cross-border competition rules and procedures will be essential. The current system of regional or community competition regulation is already outdated, and its institutional design leaves much to be desired. This is uncontroversial, and is demonstrated by the scant number of cases brought before Andean institutions.
On a separate but important matter, Ecuadorian competition law permits civil claims for damages from anticompetitive behaviour, but the absence of precedents over a decade later highlights systemic issues. Key institutional flaws include the lack of procedural mechanisms such as class actions or collective redress, which are critical for aggregating small individual claims that often fail to motivate independent lawsuits due to their limited monetary value. Additionally, the absence of “disgorgement” remedies –mechanisms to strip wrongdoers of ill-gotten gains – further weakens private enforcement. Introducing class actions or similar collective mechanisms alongside disgorgement could bolster private enforcement, complementing public efforts by the competition regulator. This would align Ecuador with jurisdictions where such tools enhance competition law effectiveness, incentivising accountability and deterrence. Addressing these gaps requires legislative reform to enable collective litigation and robust remedies, potentially drawing on models from the EU or US systems.
A related issue in institutional design is the limited expertise and familiarity with competition law in domestic courts. This problem is particularly pronounced in contentious administrative tribunals, which review decisions from the Competition Superintendence, but it is even more critical in civil courts where the disconnect with this field is stark. It is time to explore alternative approaches, such as establishing specialised courts with jurisdiction over not only antitrust issues but also related areas such as consumer protection, intellectual property, and regulated sectors.
As a final reflection, it is worth noting that the constitutional justice system implemented in Ecuador – which is very relaxed over accepting legal actions of a diverse nature – has been activated by parties investigated (and found liable) by the Competition Superintendence as an alternative means of contesting sanctions imposed by the Competition Superintendence, as opposed to following the ordinary process before contentious administrative tribunals. A clear sign of this is the case initiated by Anheuser-Bush Inbev against the Superintendence seeking annulment of its decision imposing fines upon the company, with a lawsuit based on the infringement on the non bis in idemprinciple. The company prevailed in the first instance, and the judgment is currently under appeal.