According to the Law On The Protection Of Competition and the Communiqué on the Regulation of Administrative Fines, the amount of administrative fines arising from the anti-competitive behaviors of the undertakings may not exceed 10 percent of the annual gross revenue of the undertakings and associations of undertakings; or the members of such associations to be fined, which are generated at the end of the fiscal year preceding the final decision. If that cannot be calculated, it should be by the end of the fiscal year closest to the date of the final decision, and it should be calculated by the Board. This rule is applied by calculating the total turnover of the undertakings.
Every once in a while, the concept of regulations on administrative fines lead the undertakings that violate the competition at a considerably lower rate—compared to the other undertakings in the same cartel—to be penalized in an unreasonable way. This type of administrative fines are caused by the size of turnovers, and they pose a problem regarding the justification of administrative fines. This can be clearly seen in the decisional practice of the Turkish Competition Board ("Board"). There are several cases in which the faultiest undertakings get minimal penalties. Due to the lack of stipulation for a precise benchmark in the legislation, the Board widely interprets the concept of "undertaking." So, when the violation is evaluated along with the presumption of concerted practices, the minority of the factors in determining amount of administrative fines lead to serious consequences for the undertakings. Without any criticism levied at presuming concerted practices and questioning their existence, it may be slightly more beneficial for the security of the law to limit the authority of the Board with more detailed legislation regarding the amount of administrative fines.
The need for more tangible standards in calculating administrative fines should be fully addressed in future legislation. Although the calculation should be made in a more limited area—rather than considering the total turnover of undertakings—the possibility of eliminating the legislation's deterrence element by skipping the calculation of the total turnover cannot be denied. Nevertheless, it is appropriately specified in the draft penal communiqué that the gross revenue of the goods and services directly or indirectly related to the violation— instead of the undertaking total gross revenue—will be taken into consideration in determining the amount of administrative fines. If enacted, the aforementioned disproportionality of the least faulty undertaking might get the highest sanction.
However, determining the gross revenue of goods and services directly or indirectly related to the violation is still questionable. Even though the new communiqué theoretically provides a positive and rational new system regarding the establishment of the quantity of administrative fines, there is no other choice but to wait and observe the effects of said amendment in practice of the Board.
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