The year 2017 was quite active and intense in terms of competition law. Turkish Competition Authority (the "TCA") launched 27 new investigations, concluded 16 investigations, and imposed nearly TRY 205 million (app. €45,230,000) in administrative fines. A total of 184 M&A transactions were notified to the TCA and four of these were taken into the second phase by the TCA in 20171.
Investigations Launched in 2017
The TCA succeeded in intimidating many sectors by launching a total of 27 new investigations into national and international companies in 2017. Big national and international companies such as Turk Telekom, Google, Mercedes-Benz, Microsoft, sahibinden.com, Sodexo, Turk Henkel, Roche, Turkcell, Vodafone, AVEA, D&R, Radontek Medical (CyberKnife) and Sony Eurasia found themselves on the TCA's radar. In addition, electricity, chicken meat, auto gas, port services, fuel distribution, road safety systems, ro-ro transportation, media, advertising and automotive spare parts sectors were affected by new investigations in 2017.
Nine investigations relate to practices covered by Article 4 (agreements, concerted practices and decisions limiting competition) of the Law No. 4054 ("Competition Law"). Thirteen investigations were launched only within the scope of Article 6 (abuse of dominant position) of the Competition Law, and five investigations were launched within the scope of both Article 4 and Article 6 of the Competition Law.
Investigations Finalized in 2017
In 2017, the TCA completed 16 investigations as a result of intensive work. Seven of these resulted in administrative fines, while nine concluded without any violation. The most notable investigation in terms of content and the companies covered was the Banking Investigation that was conducted in order to determine whether 13 banks providing loans to corporate customers in Turkey violated Turkish Competition Law through exchange of commercially sensitive information. It was resolved that BTMU Turkey, ING and RBS violated the Turkish Competition Law by exchanging commercially sensitive information, especially on future pricing. On this basis, ING was fined TRY 21,112,960.50 (app. €4,675,000) and RBS was fined TRY 66,429.75 (app. €14,700). On the other hand, BTMU Turkey applied for leniency was not fined based on Article 16/6 of the Competition Law, which sets out that the companies cooperating with the TCA may be immune from applicable fines, based on the qualification, efficiency and timing of such cooperation.
In 2017, the largest fine imposed was in the Mey Icki Decision. After investigating whether Mey Icki abused its dominant position in the raki market by foreclosing its competitors through its rebate schemes, the TCA decided to impose an administrative fine of TRY 155,782,000 (app. €34,681,000). Other important investigation completed in 2017 and imposing administrative fine was Trakya Cam Investigation with an administrative fine of TRY 17,497,000 (app. €3,900,000). The TCA investigated whether Trakya Cam violated Article 4 of the Competition Law by implementing the dealership distribution agreements which had been determined as a violation because of active sales prohibitions and non-compete obligations applied by Trakya Cam in a previous TCA decision. Another notable investigation was carried out on Booking.com. The TCA evaluated whether Booking.com abused its dominant position by Booking.com's "best price guarantee" practices and decided to impose an administrative fine of TRY 2,543,000 (app. €570,000).
There were also some important investigations which were concluded in 2017 without any violation of the competition Law. The first one was the investigation of the Association of Insurance and Reinsurance Companies of Turkey and 32 insurance companies operating in the compulsory traffic insurance market in Turkey. The TCA started an investigation, based on the alleged anti-competitive agreements or concerted practices by way of collusively increasing prices and allocating markets. The TCA resolved that the concerned undertakings were not involved in any anti-competitive behavior. Another notable investigation was carried out on 10 ready-mixed concrete companies that operate in the ready-mixed concrete sector in the west of Turkey. The TCA evaluated whether these companies were engaged in agreements or concerted practices that restricts or distorts the competition by jointly increasing prices. At the end of the investigation, on 22 August 2017, the TCA resolved that the investigated companies were not involved in any anti-competitive behavior. The last important investigation concluded without establishing violation was carried out on four companies operating in the steel sector. Following its review of the TCA's decision, the 13th Chamber of the Council of State resolved to overturn the mentioned decision, on the basis that the TCA should have conducted a full-fledged investigation to thoroughly analyze the allegations, instead of closing the file through a preliminary investigation. The TCA thereafter initiated an investigation into the practices of Turkish iron and steel market players in order to determine whether these undertakings were abused their dominant position through refusal to supply. The TCA resolved that the investigated companies were not involved in any anti-competitive behavior.
Lessons to be drawn from 2017
As we can see, such an intense year like 2017 shows us the impression of what is waiting for in 2018. The TCA is taking a bolder approach to the companies, and is likely to initiate more investigations and imposes more fines. That means competition compliance programs will be more important for all companies, which must be more vigilant about compliance with competition law.
Footnote
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