A Brazilian auction is a certain set of rules for a

reverse auction Reverse or reversing may refer to: Arts and media * ''Reverse'' (Eldritch album), 2001 * ''Reverse'' (2009 film), a Polish comedy-drama film * ''Reverse'' (2019 film), an Iranian crime-drama film * ''Reverse'' (Morandi album), 2005 * ''Reverse'' ...

. The buyer communicates the price she or he is willing to pay for the whole lot in advance. Then, the sellers bid on how many identical units they are willing to provide at that price. Like in

English auction An English auction is an open-outcry ascending dynamic auction. It proceeds as follows. * The auctioneer opens the auction by announcing a suggested opening bid, a starting price, or a reserve for the item on sale. * Then the auctioneer accepts ...

, bidding continues until a bid is made that no other bidder is willing to top. Other sources define Brazilian auction as a

with similarities to

Dutch auction A Dutch auction is one of several similar types of auctions for buying or selling goods. Most commonly, it means an auction in which the auctioneer begins with a high offer price in the case of selling, and lowers it until some participant accep ...

. Like in the previous definition, the overall price is constant. But instead of the increasing price as in Dutch auction, the amount of identical items is decreasing.

History

Brazilian auction as a variation of Dutch auction is introduced by Portum AG for

Linde plc Linde is a global multinational chemical company and the world's largest industrial gas supplier by market share and revenue. Founded by German scientist and engineer Carl von Linde in 1879 in Wiesbaden, Germany, the company is now headquarter ...

in the context of selling gas in

Brazil Brazil, officially the Federative Republic of Brazil, is the largest country in South America. It is the world's List of countries and dependencies by area, fifth-largest country by area and the List of countries and dependencies by population ...

. The history of auctions in Brazil dates back to the colonial period, with auctions of slaves and confiscated goods in public squares. However, the regulation of the auctioneer profession only occurred in 1932, with Decree No. 21,981/32, signed by Getúlio Vargas. Evolution: Colonial Period: Auctions were common, especially the sale of slaves and confiscated goods. 19th Century: With the end of Portuguese rule, auctions became stronger as a way of acquiring imported products. 1851: Decree No. 858 distributed the "Regulations for Auction Agents in the Rio de Janeiro Square", regulating the organization and advertising of auctions. 1932: The auctioneer profession was regulated by Decree No. 21,981/32, with Getúlio Vargas. 1933: Changes in legislation in favor of auctioneers were recorded in Decree No. 22,427/33. Today: Auctions continue to be an important commercial and financial activity in Brazil, with several areas of application, such as the sale of real estate, used goods, vehicles, among others, leilao.org.

References

{{Reflist Types of auction