The Amendment to Law No. 4054 on Protection of Competition (“Law no. 4054”) (“Amendment”) entered into force as of the date 24.06.2020 after being published in the Official Gazette of Turkey dated 24.06.2020, numbered 31165. The Amendment involves important innovations such as “de minimis” analysis, “structural remedies”, “commitment” and “settlement” mechanisms which are implemented already in the EU Competition Law. With the amendments made, a more harmonious structure with the EU Law has been provided in terms of the basic functioning of the Competition Law and the attitude of the Competition Board against the competition violations. Accordingly, the changes deemed important by us are given below:
1- With the Amendment made in the 5th article of the Law no. 4054, the “self-assessment” mechanism which envisages a more flexible examination system regarding to “exemption” regime is made clear. In this regard, undertakings will self-assess the criteria needed for granting the exemption from the prohibition of anti-competitive agreements. However, they also reserve the right to apply to the Competition Board (“Board”) in case of having hesitant. Moreover, this provision regulated as mandatory for undertakings meeting the conditions. Which means is the Board’s discretionary power has been lifted in terms of undertakings that fulfil the conditions for the exemption.
2- With the Amendment made in the Article 7 of the Law no.4054; the test so called SIEC (significant impediment of effective competition) is adopted by Turkish competition law system instead of the “dominant position test” regarding the merger and acquisition to provide parallelism with the EU legislation. Thus, in addition to the prohibition of creation or strengthening of a dominant position, the transactions that can significantly reduce competition are also prohibited.
3- With the Amendment made on article 9/1 of the Law no.4054; an explicit provision has been added that “structural remedies” such as to cease certain activities of the enterprises, transfer its partnership shares or assets can be introduced in the final decisions of the Board as an exceptional way to be applied in cases where behavioural remedies do not yield results. Hereby, the instruments of the Board against violations are increased and a more effective method is provided against the competition violations.
4- With the Amendment made on article 15/1-a of the Law no.4054, it is aimed to extend the authority of on-site investigation, which is very important for cartel detecting and, to clarify the powers regarding the examination / copying / printing of data / documents.
5- With the Amendment made on Article 41 of the Law no.4054; an arrangement compatible with the “de minimis” analysis in the EU legislation is introduced to Turkish Competition system. In this context; in cases where thresholds such as market share and turnover to be determined by the Board are not exceeded; agreements, concerted practices, and practices of associations of undertakings may not be the subject of an investigation except for hard-core restrictions such as price determination, region / customer sharing, restriction of supply amount. Thus, it is aimed to make efficient use of public resources.
6- With the amendment made in Article 43 of the Law no.4054; the mechanism of “commitment” and “settlement” are adopted. Thus, undertakings are given the opportunity to make commitments to eliminate competitive concerns and, in the event that the relevant commitments are deemed to meet the concerns by the TCA, it is aimed to use public resources effectively by not initiating / terminating the investigation. In addition, with the undertakings that acknowledge the existence of the violation during the investigation, an opportunity is reached to settle until the notification date of the investigation report, thereby both the investigation period and public costs can be reduced. In this respect, up to 25% reduction can be made on the administrative fines to be imposed as a result of the investigation and both the administrative fines agreed on and the matters contained in the text of the settlement cannot be the subject of the case.
7- Finally, we would like to state that the Amendment involves some administrative changes regarding the personal of the institution such as Vice-President number to be increased, rules regarding to staff titles / staff degrees / numbers etc. to be arranged explicitly, the provision stipulated in the Civil Servants Law to be applied to assistant experts, the Article 104 of Banking Law to be applied in terms of criminal and legal responsibility etc.
With Respect,
Güzel Law Office
“This information note does not cover all issues related to the Amendment, nor is legal advice. If you need legal advice on the matter, please contact the Güzel Law Office.”