Amendments In The Competition Law-Brief Evaluation

We have prepared a brief evaluation of the amendments in the Competition Law published in the Official Gazette on June 24, 2020.

First of all, we would like to point out that with the amendments made; a number of new practices were introduced in the Law. Each of these changes seems to be substantial enough to be the subject of a separate article and the subject is seemingly going to continue to be on the agenda of lawyers and companies for a long time.

We would like to state that the Competition Authority's decisions regarding the changes and new practices, communiqués, or guides that will be published will be very important and determinant. It is therefore worth noting that the changes summarised hereunder should be read with this approach.

Let's take a look at the amendments:

Mergers and acquisitions which do not seriously affect competition, shall not be reviewed by the Authority

With the amendment made, exemptions from prohibitions listed in Article 4 of the Law have been expanded. Thus, the discretionary power of the Board has been abolished and it has been ordered as mandatory that Article 4 will not be applied if the conditions exist. The related companies will not apply to the Authority in the opinion that their agreements are exempt.

Mergers and acquisitions audit criteria are changed

"Dominant position” criteria is left. Accordingly, M&A's that may affect the competition in the market will be prohibited despite there is no dominant position or any situation strengthening the current dominant position. This is called "significant reduction of effective competition” in line with the EU regulations.

The most important one among the changes and where the details regarding its implementation are of great importance, is the regulation regarding the “STRUCTURAL MEASURES”:

Apart from behavioral measures which order a certain behavior to be done or not to be done, is it has been done up to now, measures such as the ending certain activities of the undertakings, transfer of partnership shares or assets (structural measure) shall also be implemented.

Presenting a “commitment” during the preliminary investigation or investigation proves shall be available (except for behaviors such as price determination, region, and customer sharing, which are considered as serious violations)

The commitments will be binding and will provide the investigation to be terminated. However, the Competition Board restart the investigation again on the same issue in case of requirements mentioned in the Law.

Reconciliation

In investigations initiated by the Authority, undertakings will be given a certain period of time to present a reconciliation text stating that they accept the existence and scope of the violation, and the Board, which evaluates the text of the reconciliation, will be able to apply up to 25% reduction in fines. The undertaking accepting the reconciliation will not be able to make this decision and fines of the Competition Board subject to litigation.

With the regulation made, an investigation may not be opened in terms of agreement / harmonious action and enterprise union practices, except for violations such as price agreement / region-customer sharing or supply limitation between competitors not exceeding the turnover and market share thresholds determined by the Board.

In terms of digital data, the Authority’s on-site inspection and document collection rights have been expanded. Competition experts will be able to analyze any data stored in physical and electronic media and information systems.

Periods and Organizational Innovations

• If the investigation committee has justifiable grounds, they have been given the opportunity to prepare additional written opinions they prepared in the investigations in 30 days instead of 15 days.
• The number of vice president has been increased from two to three.
• The number of personnel of the Authority has been doubled.
• With the arrangements envisaged in terms of competitiveness / professional staff, the expertise thesis obligation is removed.

As mentioned at the beginning, Board decisions, guidelines, and secondary legislation regarding these new regulations are of great importance. We will continue to share the developments