On 16 March, 2021, The Turkish Competition Authority published the Communique on Agreements, Concerted Practices, and Decisions of Associations of Undertakings that Do Not Appreciably Restrict Competition numbered 2021/3 ("the Communique") in the Official Gazette (Available in Turkish Only). The Communique sets forth the principles and scope of the de minimis standard in line with the De Minimis Notice of the European Commission numbered 2014/C 291/01.
How Will the De Minimis Standard Apply?
In line with Law No. 4054 on Protection of Competition (“Competition Law”), under the de minimis standard, the Board may not launch investigations into agreements, concerted practices, and the decisions of associations of undertakings that do not appreciably restrict competition and do not fall within the scope of evident and severe violations. While Competition Law does not provide for an absolute exemption in such cases, and it is at the Board's discretion whether or not to launch an investigation, undertakings, nevertheless, have gained a vigorous defense opportunity against alleged violations.
The Scope of the De Minimis Standard
The Communique puts forward the scope for the application of the de minimis standard definitively. More precisely, the Communique sets out market share thresholds under which agreements are deemed not to restrict competition appreciably. Accordingly, these agreements are as follows:
- in cases of horizontal agreements among competitors where the combined market share of the undertakings does not exceed 10% in any affected market and,
- in cases of vertical agreements among non-competitors (i.e., undertakings at different stages of the supply chain) where the market share of each undertaking does not exceed 15%.
According to the Communique, when calculating an undertaking’s market share, the Board will consider the economic unity doctrine and total revenue.
Another important outcome of the Communique is the definition of evident and severe violations, which it lists conclusively. Accordingly, evident and severe violations are defined as:
- horizontal agreements, concerted practices, and decisions of undertakings’ associations in relation to price-fixing, allocation of customers, output, territory or trade channels, output limitations or quotas, and collusive tendering,
- the exchange of competitively sensitive information such as information on future pricing, output, or sales quantities among competitors,
- resale price maintenance agreements, concerted practices, and decisions of undertakings’ associations that impose fixed or minimum prices on distributors.
Although their future decisions will show how the Board will use its discretion, it can be argued that Competition Law and the Communique provide a safe harbor for agreements that do not restrict competition appreciably.
Please contact Ali Ilıcak for more information.