Legislation and jurisdiction
1 How would you summarise the development of private antitrust litigation in your jurisdiction?
In Turkey, private antitrust litigation has been applicable since Law No. 4054 on the Protection of Competition (Competition Law) entered into force in 1994. There have been a number of pending cases concerning private enforcement of competition law. The judicial developments has been relatively limited and there have not been many court precedents in that respect. This is mostly because injured parties are largely unaware of the private enforcement and compensation opportunity. Additionally, the lengthy court proceeding period and the rules regarding the limitation period are among the factors preventing private antitrust litigation from becoming attractive to the injured parties. Moreover, the lack of established practice among the civil courts and difficulties encountered in accessing evidence for antitrust practices also constitute obstacles to the development of the private antitrust litigation.
However, the increasing interest of academics and bar associations encourages future private antitrust litigation. Another promising aspect is the discussion platforms that bring the Turkish Competition Authority (TCA), the courts, the practitioners and the academics together to put forward their views and discuss the possible ways to create a tradition of private antitrust litigation. A positive development in that regard is a recent action taken by the parties (which have suffered damages) against the banks, which were found to have violated the Competition Law by being involving in a cartel. These cases are still ongoing and their outcome is yet to be seen.
2 Are private antitrust actions mandated by statute? If not, on what basis are they possible? Is standing to bring a claim limited to those directly affected or may indirect purchasers bring claims?
The rules regulating private antitrust actions are set forth under the Competition Law. Albeit granting injured third parties the right to claim damages, section 5 of the Competition Law does not provide any definition of an injured party (or parties) that has suffered harm as a result of a breach of the Competition Law. For example, it is still controversial whether or not indirect purchasers can claim damages. But the greatest difficulty that indirect purchasers may encounter in the process of private enforcement is to satisfy the conditions of being a 'plaintiff ' in the relevant antitrust actions since they would have to prove a causal link between the competition infringement and the damages incurred under the Turkish law. Therefore, potential claims of indirect purchasers are likely to be dismissed by the court.
3 If based on statute, what is the relevant legislation and which are the relevant courts and tribunals?
In the case of a breach of the Competition Law, section 5 grants a right for injured party (or parties) to claim treble damages before the civil courts, which have exclusive jurisdiction in such matters. The civil courts shall apply general principles of torts regulated under the Turkish Code of Obligations No. 6098 (Code of Obligations). The procedural rules set out in the Code of Civil Procedure (CCP) are applicable to private antitrust litigation. At the same time, both parties may lodge an appeal against the civil court judgments. In addition, under the Consumer Protection Act, the Arbitration Committee for Consumer Problems has the power to hear consumer disputes below a certain threshold. This applies to disputes arising out of the Competition Law and the consumers must bring their disputes before this Committee so long as the dispute is below the concerned thresholds. The current thresholds range is between 4,570 Turkish lira to 6,860 Turkish lira depending on the municipality status of the city, where the dispute has arisen.
4 In what types of antitrust matters are private actions available? Is a finding of infringement by a competition authority required to initiate a private antitrust action in your jurisdiction? What is the effect of a finding of infringement by a competition authority on national courts?
In the case of a breach of any rule under the Competition Law, private actions can be taken in accordance with article 57 of the Competition Law. Those who prevent or restrict competition by way of anticompetitive concerted practices, decisions or agreements as well as by abusing their dominance, shall compensate the injured party(s) damages.
In its judgment dated 30 March 2015 (2014/13296 E./2015/4424 K.), the Court of Cassation ruled that the injured parties may claim their damages as soon as they become aware of the person who violated the Competition Law and the existence of the injury. In addition, the court also stated that a decision of the TCA shall not be a prerequisite for bringing a compensation claim. Therefore, it is suggested to bring an action for damages as soon as possible, after submitting the complaint to the TCA.
However, in a lawsuit based on competition law infringement without a previous application to the TCA, it is likely that the civil court would request the plaintiff to make its complaint to the TCA first so that it can determine whether there is a breach of competition law and whether there are legal grounds for the alleged competition law violation. On the other hand, the civil court shall only evaluate whether the applicant has suffered harm as a result of the competition law violation and shall not take into consideration arguments of the defendants against the decision of the TCA. In other words, civil courts do not have power to evaluate whether the TCA's decision is against the law. However, the parties that are engaged in the violation of the competition rules may appeal the TCA's decision finding the violation before the administrative courts. If a private enforcement action is brought to a civil court before the decision of the administrative court becomes final, the civil court may, under article 165 of the CCP, decide to wait until the said administrative court becomes final.
5 What nexus with the jurisdiction is required to found a private action? To what extent can the parties influence in which jurisdiction a claim will be heard?
The competent court in private antitrust litigation is determined in accordance with the CCP. The CCP authorises the local courts of the geographic district in which the damage has arisen or the court located in the domicile of the claimant. As for the general principle of jurisdiction, the court of the place where the illicit act or competition infringement has occurred shall be defined as the place where the essential elements of the illegal act have taken place. As to the location where the damage has arisen, this will likely be linked to the place where the claimant has incurred damages from the infringement. Taking into account that the TCA defines the relevant geographical market as be competent to hear the case.
6 Can private actions be brought against both corporations and individuals, including those from other jurisdictions?
Yes. Private actions can be brought against both corporations and individuals including those from other jurisdictions.
Private action procedure
7 May litigation be funded by third parties? Are contingency fees available?
In Turkey, there are no litigation-financing companies that fund litigation costs, bear financial risks or receive a certain percentage in the case of success. Under Turkish law, only attorneys-at-law are eligible to represent and act on behalf of clients in legal processes and litigation cases before courts, whereas antitrust investigations and filings before the TCA can be conducted by representatives who are not attorneys-at-law.
As to fees, according to article 164 of the Attorneys' Act, the attorneys' fee may be agreed as a certain percentage or money to be litigated or adjudicated, not exceeding 25 per cent.
Contingency fees are available under Turkish law. In the event of a successful outcome of the proceeding, the attorneys may receive a certain percentage of the proceeds recovered by the claimant, provided that the claimant and representatives (attorneys) agreed on this beforehand.
8 Are jury trials available?
No. Jury trials have been recognised in neither civil nor criminal cases under Turkish law.
9 What pre-trial discovery procedures are available?
There are no pre-trial discovery instruments that enable parties to obtain discovery regarding any non-privileged matter that is relevant to any party's claim or defence. There are some discovery proceedings, such as requesting declaratory decisions for the breach of trademark and recording of evidence; not within the scope of antitrust private litigation.
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