Turkey: The Board published the reasoned decision on the preliminary investigation conducted against the water manufacturers that are members of Packaged Water Manufacturers Association

Last Updated: 22 March 2018

The Board published the reasoned decision on the preliminary investigation conducted against the water manufacturers that are members of Packaged Water Manufacturers Association (17-38/610-266, 23.11.2017).

The Turkish Competition Board (“Board”) published its reasoned decision on the preliminary investigation conducted against the water manufacturers that are members of the Packaged Water Manufacturers Association (“PWMA”), based on the allegations that the relevant undertakings have violated the Articles 4 and 6 of Law No. 4054 on the Protection of Competition (“Law No. 4054”) by way of jointly determining water prices.

PWMA brings together packaged water producers and supplier organizations active in packaged water industry and has 36 institutional members representing approximately 70% of packaged water production in Turkey. Some of the members of PWMA, such as ERİKLİ, PURE LIFE, HAYAT, SIRMA, DAMLA, PINAR and SAKA, are the leading brands in the market for dispenser size bottled water

Information on the Sector and the Relevant Market

The Board initially provided information on the overview of the sector and indicated that the packaged water may be grouped under two categories as (i) dispenser size bottled water, marketed within large packages greater than 10 liters, where most of the sales volume consists of polycarbonate carboys and (ii) bottled water which is usually sold within packaged with smaller volumes ranging from 0,5 lt, 1 lt and 5 lt. 

In addition, the Board explained the difference between the dispenser size bottled water and the plastic bottled water in order to define the relevant product market. The Board stated that while the dispenser size bottled waters are delivered directly to consumers’ houses or offices, the plastic bottled water is sold to consumers through retailers. Furthermore, the Board considered that the prices of the plastic bottled water are much higher when compared to the prices of the polycarbonate carboys. In light of the abovementioned factors, the Board defined the relevant product market as “dispenser sized bottled water” and the relevant geographical market as “Turkey”.

The Board’s Assessment

The Board initially grouped the allegations that may be evaluated under Law No. 4054 under three categories:

  1. Firstly, the Board evaluated the following allegations within the framework of horizontal relations between undertakings under the Article 4 of Law No. 4054: (i) there is a cartelization in water market, (ii) the prices of dispense sized bottled waters are jointly determined by the producers, (iii) the undertakings jointly render strategies and decisions since water prices are parallel to one another. 
  2. Secondly, the Board evaluated the following allegations in scope of the vertical relationship between ERİKLİ and its distributors under Article 4 of Law No. 4054:  (i) ERİKLİ restricted competition between distributors by way of the agreements signed with the distributors, it prevented distributors from conducting sales (i) outside their territories, (ii) of products that belong to other brands and (iii) with prices other than the determined.
  3. In addition, the Board decided to evaluate the following allegations under Article 6 of Law No. 4054: (i) ERİKLİ transferred DANONE’s and other brands’ distributors by using its dominant position in the market, (i) ERİKLİ forced other distributors and brands to cease commercial activities by way of using its dominance.

Assessments in scope of the Article 4 of Law No. 4054

The Allegation that the Competitors jointly determine the water prices

Firstly, the Board stated that, the information obtained during on-site inspections do not support the allegations that the producers jointly determine prices of dispenser sized bottled waters, which were derived from the fact that prices obtained via telephone calls appear to be similar to each other. The Board indicated that, during the on-site inspections carried out within the scope of the case file, no information or document has been obtained that could indicate that the water producers collectively determine prices.

The Board stated that, on the contrary, the documents and e-mail correspondences obtained from the computers of the undertaking’s employees indicate that the competitors' prices and campaigns are monitored within the market and the information collected is used for competing with other competitors in the market. In this context, the Board found that the only argument the complainant has put forward in support of the claim is based on the similarity of the prices obtained via telephone calls.

Furthermore, the Board highlighted that in scope of the investigations, the researches show that the highest priced product compared to the lowest priced product is approximately 28% more expensive. In addition, a price difference of 30% for natural spring water, a seemingly homogeneous product in the consumer's eyes, does not support the claim that these products are priced on the same levels. Thus, based on the information obtained, the Board concluded that there are no arguments to support the allegations that the water producers jointly determine the prices.

Assessment on the ERİKLİ’s distribution agreements

Regarding the allegations concerning ERİKLİ’s distribution agreements, the Board firstly stated that pursuant to the Article 4 of Law No. 4054, “Agreements and concerted practices between undertakings, and decisions and practices of associations of undertakings which have as their object or effect or likely effect the prevention, distortion or restriction of competition directly or indirectly in a particular market for goods or services are illegal and prohibited.”

In addition, the Board indicated that, pursuant to the Article 2 of Block Exemption Communiqué on Vertical Agreements (“Communique No. 2002/2”), the agreements concluded between two or more undertakings operating at different levels of the production or distribution chain, with the aim of purchase, sale or resale of particular goods or services -vertical agreements- are exempt from the prohibition in the Article 4 of Law No. 4054 if they bear the conditions mentioned in the relevant Communiqué.

The Board stated that in order for the vertical agreements between ERİKLİ and its distributors to benefit from the block exemption provided by the Communique No. 2002/2, the market share of ERİKLİ or its’ parent NESTLE group, should be below the 40% threshold in the relevant market. In this regard, the Board indicated that the market shares of ERİKLİ and NESTLE fall well below %40 in the relevant market. Therefore, the Board indicated that the first condition provided in the Communique No. 2002/2 for benefiting from the block exemption is fulfilled.

In addition, the Board stated that other conditions regulated under the Article 4 of the Communique No. 2002/2 should also be met to benefit from the block exemption.  The Board indicated that pursuant to the Article 4(a) of Communique No. 2002/2, the supplier may determine the maximum sales price or recommend the sales price, on the condition that it does not transform into a fixed or minimum sales price. In addition, pursuant to the Article 4(b) of the Communique No. 2002/2, the allocation of exclusive regions to the distributors and restricting the distributors from conducting active sales (and not passives sales) outside of the allocated territories do not obstruct the application of the Communique No. 2002/2.

Furthermore, regarding the non-compete obligation the Board stated that, pursuant to the Article 3 of the Communique No. 2002/2, non-compete obligation should not be imposed on the purchaser for an indefinite period or for a duration that exceeds five years. In addition, the Board indicated that non-compete obligations may be imposed on the purchaser provided that it does not exceed one year as of the expiry of the agreement, on the conditions that it is compulsory for protecting the know-how transferred by the supplier to the purchaser.

In light of the foregoing, the Board stated that, the allegations that ERİKLİ has violated the Article 4 of Law No. 4054 (i) by preventing the distributors from selling water outside of their own territories and (ii) preventing the distributors from marketing other brands active in the sector are not in violation of the Communique No. 2002. However the allegation that ERİKLİ is preventing the distributors from conducting sales with prices other than those determined by ERİKLİ is explicitly in violation of Article 4(a) of the Communique No. 2002/2.

As a result, after evaluating the provisions of the relevant distribution agreement, the Board concluded that since the agreement does not contain any provisions that may be interpreted as the determination of resale prices and fully compliant with the regulations of the Communique 2002/2. Therefore, the Board decided that the agreement fulfills all the conditions for benefitting from the block exemption under the Communique No. 2002.

Assessments in scope of the Article 6 of Law No. 4054

The Board also evaluated the allegations that ERİKLİ (i) transferred DANONE’s and other brands’ distributors by using its dominant position in the market, (i) forced other distributors and brands to cease commercial activities by way of using its dominance. The Board stated that in order for a conduct to be considered as an abuse of dominant position under Article 6 of the Law No. 4054, two cumulative conditions must be satisfied: (i) the undertaking that has engaged in the conduct must be in a dominant position in the relevant market, and (ii) the conduct itself must be abusive in nature.

In this regard, in order to understand whether ERİKLİ has abused its dominant position, firstly, the Board determined the market share of NESTLE group and as a result, by considering the market share and the number of competitors in the market,  the Board stated that ERİKLİ is not in dominant position in the market.

In addition, the Board stated that during the on-site inspections, no information or document has been obtained that may support the allegations that ERİKLİ has impeded the activities of its competitors or engaged in any abusive conduct in the market. 

Ultimately, in light of the above, pursuant to the Article 41 of Law No. 4054, the Board decided not to initiate full-fledged investigation.

This document is not intended to create an attorney-client relationship. You should not act or rely on any information in this document without first seeking legal advice. This material is intended for general information purposes only and does not constitute legal advice. If you have any specific questions on any legal matter, you should consult a professional legal services provider.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Contact the Author?
Click here to email the Author
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Other Turkey Advice Centres
Intellectual Property
Privacy and Data Protection
More Advice Centers
Significant Recent Cases
Turkish Competition Board case summaries.
Useful Resources
The most recent developments within our firm and practice areas.
ELIG Gürkaynak quarterly newsletter, Legal Insights Quarterly, which includes a collection of essays for informational purposes.
A collection of articles, essays and reports written by our experts.
Upcoming Events
Information on upcoming or recent events and conferences hosted by ELIG Gürkaynak Attorneys-at-Law.
ELIG Gürkaynak has hosted a Turkish competition law webinar in collaboration with Lexology. During the webinar, head of our competition law and regulatory practice, Mr. Gönenç Gürkaynak, introduces remedies and Phase II reviews under the Turkish merger control regime.
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions