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Two-minute Recap of Recent Developments in Turkish Competition Law - September 2023

Turkish Competition Activity Tracker 202309

Meta is slapped with a fine for its data practices and asked to provide remedies – Dissenting opinion even calls for break up!

On 11 September, the Board published its reasoned decision regarding the investigation into Meta’s data combination practices. To re-cap, the investigation was a product of Meta’s announced changes to its WhatsApp’s privacy policy. For more background, you can read our previous article here.

During its dominance assessment, the Board determined that Meta holds a dominant position in the Turkish markets for (i) social network services for personal purposes, (ii) consumer communication services, and (iii) online display advertising.  After stating that Meta is dominant in the aforementioned markets, the Board decided that Meta’s data combining activities solidified its market position and created barriers to market entry. To this end, the Board deemed that Meta abused its dominant position and imposed an administrative fine of EUR 18.6 million. The Board gave Meta one month to come back with appropriate remedies that will facilitate effective competition in the market.

In their dissenting opinion two Board members stated that the secret to Meta’s ability to make its market power, by way of excessive data collection, “invincible” is (i) its ability to control both the social networking and consumer communication services and, (ii) owning a data set, that will not be available to its competitors, no matter how efficient. On this basis, the dissenting opinion states that the breakup of this integrated structure is the only way to facilitate effective competition.

Ophthalmologists escape unscathed: Standard of proof not met

On 22 September, the Board announced the conclusion of its preliminary investigation into eight undertakings, including companies such as EssilorLuxottica, Hoya, and Seiko in the production and wholesale market of ophthalmic lenses to determine whether they infringed Turkish Competition Law by fixing prices. The Board followed a very high standard of proof, as it did not find it sufficient to initiate a full-fledged investigation on the back of internal documents, casting doubt that there may be direct contact between competitors.

To this end, as the evidence in the case file demonstrated that the undertakings concerned were in competition with one an another and, in addition, that the price change dates were different, the Board concluded that these documents cannot be relied upon. Ultimately, the Board did not initiate a full-fledged investigation.

Rethinking leniency: Public consultation on new leniency regulation

On 28 September, the Turkish Competition Authority published a new draft leniency regulation for public consultation. The announcement is available here (in Turkish only).

With the new draft, the authority aims to make a clearer distinction between the leniency programme and the settlement procedure. In particular, the new draft aims to lower the evidentiary standard for leniency applications and suggests that leniency applicants should provide evidence that has added value, whereas the current regulation requires new and incriminating evidence. 

In addition, the new regulation aims to allow leniency applications from "cartel facilitators" in addition to cartel members. This is expected to provide legal certainty in particular for leniency applications made by "hubs", which are considered as cartel facilitators by the Authority, in hub-and-spoke arrangements.

Trendyol - off the hook for predatory pricing allegations

The preliminary investigation examined whether Trendyol abused its dominant position by leveraging its dominant position in the multicategory marketplace market to online food delivery and online grocery delivery markets, via cross-subsidisation. To this end the Board examined whether Trendyol’s prices were predatory (i.e., below cost).

In terms of the online food delivery market: The Board concluded that Trendyol operated on a negative profit margin from March 2020 to September 2022. However, the Board stated that this below-cost pricing had no effect on Trendyol’s competitors. Yemeksepeti remains the dominant player and Getir was able to gain increasing market share. A similar conclusion was reached for the online grocery delivery market.

In conclusion, the Board held that there is no need to initiate a full-fledged investigation.

Duracell is under full-fledged investigation

On 28 September 2023, the Board announced that it has concluded the preliminary investigation phase and initiated a full-fledged investigation against Duracell Satış ve Dağıtım Limited Şirketi. The subject of the preliminary investigation is whether Duracell is engaged in resale price maintenance and whether it restricts the territories and customers to which resellers could conduct sales.

For more information please contact Bulut Girgin, Partner, Head of Competition & Compliance, at bgirgin@gentemizerozer.com, Associate Enis Doğa Küçükay, at dkucukay@gentemizerozer.com, or Legal Trainee Efe Utku Çal, at ecal@gentemizerozer.com.