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Unchartered Territories: A Comparative Study of Newly Introduced Commitment & Settlement Mechanisms
As explained in depth within the previous June 2020 issue of Legal Insights Quarterly, the Law No. 4054 on the Protection of Competition has finally been amended by the Grand National Assembly of Turkey.
As explained in depth within the previous June 2020 issue of Legal Insights Quarterly[1], the Law No. 4054 on the Protection of Competition has finally been amended by the Grand National Assembly of Turkey. The amendments, which were accepted by the parliament and entered into force on 24 June 2020 ("Amendment Law"), introduced numerous novelties to the established practice with the overall aim of bringing Turkish competition law closer to European Union practice. These practices include a different selection mechanism for Competition Authority's cases, introduction of the SIEC[2] test for merger control and numerous procedural tools to increase efficiency of the Competition Authority.
This article aims to shed light on the newly introduced commitment and settlement mechanisms during anti-competitive behavior investigations. It should, however, be noted that the commitment and settlement mechanisms under Turkish competition law is not yet drawn out by secondary legislation or established by practice. As these mechanisms are inspired by the European practice, this article will examine the EU practice, together with current Turkish legislative framework.
(i) Settlement and Commitment Mechanisms under the Amendment Law
The Amendment Law introduces two new mechanisms inspired by EU competition law which aim to enable the TCA to end investigations without going through the entire pre-investigation and investigation procedures.
The first mechanism is a commitment procedure. This will allow undertakings or an association of undertakings to voluntarily offer commitments during a preliminary investigation or full-fledged investigation to eliminate the TCA's competitive concerns under Articles 4 and 6 of Law 4054, prohibiting restrictive agreements and abuse of dominance. Depending on the sufficiency and the timing of the commitments, the TCA can decide against launching a full-fledged investigation following the preliminary investigation or to end an on-going investigation without completing the entire investigation procedure. However, commitments will not be accepted for violations such as price fixing between competitors, territory or customer sharing and the restriction of supply. The TCA will provide the details of these new procedures by secondary legislation and may reopen an investigation in the following cases:
- a substantial change in any aspect of the basis of the decision;
- the relevant undertakings' non-compliance with the commitments; or
- the decision was based on deficient, incorrect or fallacious information provided by the parties.