In general, competition authorities of many countries are considered to be effective guarantors of transparency on matters concerning public access to official information. Particularly for the merging companies or for publicly traded corporations, the transparency of the Competition Authorities uncovers the companies' information and provides a first-step background check on competition compliance. A sound and transparent public administration must be identified in order to ensure third parties' and stakeholders' certainty on enforcement systems. A fair and predictable process bolstering legitimate enforcement is crucial.
A debatable necessity for transparency: An example from Turkey
The Turkish Competition Authority (TCA) deploys various tools in order to ensure transparency. Example to these tools include the guidelines containing information on how a case is decided and procedural rules. The formal opening of an investigation is announced on the Authority's website and the intervening parties are invited to present their arguments and submit evidence during the course of the investigation. Due to the nature of the competition advocacy and the need to ensure full transparency, the reasoned decisions and the court judgments are also published on the website. However, another necessary - yet a debatable - tool for providing transparency seems to be overlooked: Applications for negative clearance/individual exemption requests.
Different practices: examples from the Member States
The traditional practice in the European Community required authorization of a negative clearance or an individual exemption following publication of a notice in the Official Journal. The EU Commission summarized the facts stating its intention to grant the exemption or clear the agreement, and requested comments from third parties within specified time. Also, a notice got published in the Official Journal for negative clearance or a exemptions applications as deemed appropriate by the rapporteurs.
However, the relevant regulation got amended and a directly applicable exemption procedure replaced the system. Today, the Competition Authorities of the Member States have the power to directly apply the legislation; thus, enforcement varies across Member States. Some enforcement bodies prefer to publish applications; however publishing is not of preference for a considerable number of the bodies.
Should the authorities publish exemption requests?
The degree of interaction allowed by the competition authorities to the parties during the proceedings differ procedurally across countries. Some authorities provide a benefit from their websites as active tools for third parties. For instance, they publish decisions, guidelines, public releases or the discussion materials on their website in order to provide further insight and enhance the transparency and predictability of the procedures. In some cases, a case may not be decided unless third parties are informed and provided with the opportunity to make comments on the case or submit evidence, if deemed appropriate.
As for the hardly-debated issue on whether an authority should publish exemption requests, a fine balance between protection of information and protection of the fair decision making process must be achieved.
Transparency and fairness, inarguably, ensure a better understanding of the facts, and the competition authorities base their enforcement on these principles. Moreover, transparency of the decision-making processes enhance predictability, and maintaining transparency can be encouraged mostly by the procedural rules. However, transparency cannot be unlimited as official documents often include confidential information. Enforcers seek to design regulations governing public access to confidential information.
The TCA, for example, has a Communiqué on the Access the File and the Protection of Trade Secrets. The TCA is successful in implementing the rules on fair procedure (by way of publishing additional guidelines on procedural rules in both languages, press releases, encouraging contact with the case-handlers, requesting the comments of the interested parties); however there remains to be ongoing debates on ways to erase the curiosity of the interested parties whilst also protecting confidential information and upholding the fairness of the process. In fact, the rights of the complainants are also regarded to be restricted and this is another hot topic in Turkish competition enforcement.
Indeed, the general legislation on the right to information provides that institutions must disclose information and documents of applicants in an efficient and post-haste manner unless it falls within the exceptions laid out. Moreover, the legislation concerning provision of public services and the legislation concerning factors required to be available in the web-sites of public institutions set a standard for publishing information on the internet. These standards are set to maintain governmental transparency and allow efficient provision of services.
In mergers and acquisition transactions, for instance, the parties are usually widely aware of their right to be informed about the notification applications and provide comments. Pursuant to the Communiqué Concerning Mergers and Acquisitions, the TCA is required to announce the notified transactions on its website detailing the undertakings concerned and their fields of operation.
However this is not the case for negative clearance/exemption applications.
The transparency of the negative clearance/exemption requests will help develop enforcement standards and encourage sound outcomes. Publishing negative clearance/exemption requests will boost efficient case management. Providing an opportunity for interested parties to make their comments on the applications and an opportunity for the case-handlers to share their initial evaluations on the case will facilitate enforcement efforts of the Turkish Competition Authority. The increased interaction between the parties and the Turkish Competition Authority will help achieve better enforcement whilst also enabling better understanding of the facts. All in all, this will provide an indirect guidance for companies and the practitioners who are planning to make similar applications. The Turkish Competition Authority will also have more space to allocate its resources to rather complicated cases - which would in return lead to greater efficiency for enforcement.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.