The Latest Competition Law Amendment – Any Change?

23.06.2024

Contents

Introduction

On 3 May 2024, a proposed amendment to several laws, including Law No. 4054 on the Protection of Competition (“the Competition Law”), aiming to expedite and hasten the conduct of investigations was published (“the Amendment”). [1]

The amendment removes the 30-day period within which companies “must” submit their first written defence under Article 41 of the Competition Law. Turkish Competition Authority case handlers need not now submit an additional opinion if their views, as stated in the investigation report, do not change in face of the company’s written defence.

The Amendment entered into force on publication in the Official Gazette on 29 May 2024.

It is too early to adopt a definitive approach on the Amendment’s potential effects, but in this short article we will discuss its potential ramifications.

The First Written Defence

The Amendment abolishes the 30-day window, triggered on official receipt of the investigation notice, in which companies were previously expected to submit their first written defence.

This has been justified on several salient grounds. The investigation notice not only did not include any definitive allegations, but also noted doubts concerning a potential violation. Therefore, the failure of a company to submit a written defence within the required timeframe could not constitute an admission of guilt (as there was no defined allegation to answer in the notice it received), nor constitute a waiver of the right to submit a defence at a later stage.

In practice, investigated companies regularly used this knowledge (of non-waiver of their defence submission rights) to “assist” their case handlers in creating a favourable report narrative. (Companies could still submit their second and third defences without submitting any defence within the stipulated 30-day period. [2])

Moreover, Article 44 of the Competition Law stipulates that investigated companies may, at any time, submit any relevant evidence to the Competition Board. As no amendment has been made to this provision, there is no reason that companies under notice of investigation could not submit a defence if they wish. Article 44 can therefore be viewed as a de facto right to submit a defence.

Additional Written Opinions and the Third Written Defence

The Amendment aims to shorten investigations by abolishing case handlers’ obligation to submit an additional opinion in response to the written defence even when their views, stated in the investigation report, have not changed.

The duration of the investigation may be extended by up to 3 months if both case handlers and the investigated company request additional time for, respectively, preparation of the additional opinion and the third written defence.

Investigated companies and case handlers may not request extensions if the additional opinion is to be issued. In these circumstances, case handlers will have 15 days to submit their opinion, while companies will have 30 days to submit their final written defence. Previously, companies could request extensions amounting to many years – a right which was granted to case handlers, for preparation of an additional opinion, in 2020. The Amendment abolishes both.

The amendment could be considered a limitation on companies’ exercise of the right of defence, as it they could be limited to one formally submitted written defence. However, as already mentioned, companies can submit any evidence that may affect the decision to the Board at any time within the scope of Article 44.

How the Amendment will shape practice - and whether it will effectively achieve its aim of streamlining and hastening investigations - remains to be seen.

New and Old Articles in Comparison

Article in Force

Proposal for Amendment

“The Board shall notify the parties of the investigations it has initiated within 15 days from the date of the decision to initiate the investigation and requests that parties submit their first written defence within 30 days. In order for the first written response period to commence. The Board shall send sufficient information regarding the type and nature of the allegations to the relevant parties alongside this notification letter.”

“The Board shall notify the parties concerned of the investigations it has initiated within 15 days from the date of the decision to initiate the investigation. The Board shall send sufficient information regarding the type and nature of the allegations to the relevant parties with this notification letter.”

Those found to have violated this Law shall be provided notice to submit their written defence to the Board within 30 days. In response to this defence, those assigned to conduct the investigation shall submit an additional written opinion within 15 days which shall be notified to all Board members and the relevant parties. The parties may respond to this opinion within 30 days. Where justifiable grounds are provided, these periods may be extended once only and by a maximum of 30 days.”

“The parties shall be provided notice to submit their written defence to the Board within 30 days following the notification of the investigation report. Where justifiable grounds are provided, these periods may be extended once only and by a maximum of 30 days. If the opinion stated in the investigation report changes as a result of the submitted written defences, those assigned to conduct the investigation shall notify their written opinions to all Board members and the relevant parties within 15 days. The parties may respond to this opinion within 30 days.”

 


[1] The proposal can be accessed here: *73c0fde0-ad2a-4cd5- bb4b-be3552d2014b.pdf (tbmm.gov.tr) (accessed: 6 May 2024).

[2] There have been cases where late first written defence were considered anyway. (see Facebook judgment (20.10.2022, 22-48/706-299), para 18).

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