A Brazilian auction is a certain set of rules for a

reverse auction A reverse auction (also known as buyer-determined auction or procurement auction) is a type of auction in which the traditional roles of buyer and seller are reversed. Thus, there is one buyer and many potential sellers. In an ordinary auction al ...

. 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 reserve for the item on sale. * Then the auctioneer accepts incre ...

, 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 asking price in the case of selling, and lowers it until some participant acc ...

. 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 plc is a global multinational chemical company founded in Germany and, since 2018, domiciled in Ireland and headquartered in the United Kingdom. Linde is the world's largest industrial gas company by market share and revenue. It serves ...

in the context of selling gas in

Brazil Brazil ( pt, Brasil; ), officially the Federative Republic of Brazil (Portuguese: ), is the largest country in both South America and Latin America. At and with over 217 million people, Brazil is the world's fifth-largest country by area ...

References

{{Reflist Types of auction