The parties to a restrictive agreement are authorized to perform a self-assessment to see if their agreement fulfills the conditions of individual exemption. They can also file an application with the Turkish Competition Authority (“Authority”) to reach a higher level of legal certainty. If the parties do not file the agreement for individual exemption and the Authority detects the agreement through other means (such as a complaint, a market study, press, an investigation, etc.), the Turkish Competition Board (“Board”) may ex officio assess whether the agreement is eligible for an individual exemption. It is unlikely that the Board would directly condemn the parties merely for being a party to a restrictive vertical agreement without analyzing whether the agreement benefits from individual exemption – it would first guide the parties through eliminating the violation, if any.
If the parties decide to file an individual exemption application with the Authority, they should, together or independently, submit the individual exemption/negative clearance form which consolidates the necessary information for an individual exemption/negative clearance review. The Authority can request that the parties to provide any information/documents it deems necessary.
The Law No. 4054 on the Protection of Competition (“Competition Law”) or secondary legislation do not provide a deadline or an implicit approval mechanism for individual exemption applications. However, under normal circumstances, a carefully handled and closely followed-up review process would take around 6 months.
Individual exemption decisions are retroactive, i.e. they take effect from the date on which the agreement is signed. This treatment allows the parties a protective cloak and eliminates the risk of non-compliance during the review process. Finally, it may be that the Board places a time limit on the effective term of the individual exemption and/or grants a conditional individual exemption.
For the sake of completeness, the Board may revoke the exemption at any time, if any of the three conditions set out in Article 13 of Law No. 4054 are fulfilled. The conditions are as follows:
- Changes in the events constituting the basis of the decision;
- Failure to fulfill the terms or obligations imposed by the individual exemption decision;
- Having taken the decision on the basis of incorrect or incomplete information concerning the agreement in question.
The revocation decision will be effective as of the date of the change in the case of condition (a) and the date of taking the exemption or negative clearance decision in the case of conditions (b) and (c). If the incorrect or incomplete information under condition (c) is supplied by the parties intentionally and/or fraudulently, the exemption will be deemed not to have been granted at all.
Please also see the “individual exemption/negative clearance application form” for further information.
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