Turkey: Turkish Competition Board Widens The Scope Of Its Probes Concerning Dominant Undertakings’ Legal And Commercial Practices Towards Sales Points In Various Sectors

Upon the Turkish Competition Authority's ("Authority") ex-officio investigation in the market for industrial ice creams in Turkey, on May 15, 2008, the Turkish Competition Board held that due to Unilever San. ve Tic.Turk A.Ş.'s ("Unilever") dominant position in the industrial ice creams market, current exclusive agreements of Unilever concluded with the sales points and its well-established commercial practices aiming at creating de facto exclusivity cannot benefit from the Block Exemption Communiqué No: 2002/2 ("Communiqué") with regard to vertical agreements. This is the fourth intervention of the Board with dominant players in the last ten months; following the decisions on Coca-Cola, Turkcell and Mey İçki, now with Unilever.

Having been evaluated by the Turkish Competition Board ("Board") as enjoying a dominant position (with its share above 40%) in the market for industrial ice creams (through its Algida trademark), in an attempt to safeguard effective competition in the relevant product market, following remedies have been imposed on Unilever by the Board;

  • Vertical agreements executed by and between Unilever (or its distributors) and sales points (other than Algida shops) that include non-compete clauses are prohibited.

  • Arrangements whereby Unilever (or its distributors) require sales points to purchase a specified minimum percentage of sales points' total ice cream requirements or offer any payment or other advantage conditioned on such purchasing obligation are prohibited.

  • Any kind of advantage (promotion, discount, financing arrangements, target rebates etc.) promised by Unilever (or its distributors) in exchange of the sales points' not selling competing products with Algida are prohibited.

After the amendments -came into force in July, 2007 through the enactment of 2007/2 Communiqué setting forth that only undertakings holding up to 40 % market share in a given relevant product market in Turkey is allowed to conclude restrictive vertical agreements-, the Authority has been quite busy trying to bring the dominant undertakings' vertical agreements in compliance with the Communiqué 2007/2.

Unilever decision is the fourth decision of the Board that has been rendered subsequent to the adaptation of market share threshold for the vertical agreements (including restrictive clauses). First three precedents of the Board by basing on market share threshold are as follows;

  • Mey Içki Sanayi ve Ticaret A.Ş. (leading undertaking in the supply of rakı (Turkey's traditional alcoholic drink) in Turkey) decision, dated 10.9.2007 and numbered 07-70/863-326.

  • Coca Cola Satış Dağıtım ve A.Ş. (leading undertaking in the supply of soft carbonated beverages in Turkey) decision, dated 10.9.2007 and numbered 07-70/864-327.

  • Turkcell İletişim Hizmetleri Anonim Şirketi A.Ş. (leading undertaking in the supply of telecommunication services in Turkey) decision, dated 27.12.2007 and numbered 07-92/1191-461.

Before the amendments on the Communiqué that came into force in July 2007, as opposed to the EC Regulations, Communiqué did not take account of the general policy that block exemption regulations should cover restrictive agreements only up to certain market share thresholds.

Although, the Board always had the power to render a decision whereby it could determine that any given dominant undertaking in a certain relevant product market cannot benefit from the privileges set forth under the Communiqué, before July 2007 amendments, the Board seemed to be hesitant to exercise such right since there had been just two decisions (Frito Lay decision, dated 3.5.2004 and numbered 04-31/367-92, Efes Pazarlama-Bimpaş decision, dated 22.04.2005 and numbered 05-27/317-80 ) where Frito Lay Gıda Sanayi ve Ticaret A.Ş. (leading undertaking in the supply of packaged chips in Turkey), Efes Pazarlama ve Dağıtım Ticaret A.Ş. and Bimpaş Bira Meşrubat Pazarlama Sanayi A.Ş. (leading undertakings in the supply of beer in Turkey) have been evaluated as dominant undertakings and thus privileges set forth in the Communiqué had been taken away.

Having diagnosed the difficulties that result from the lack of applicable market share thresholds, the Board seems to have found it appropriate to make certain amendments on the Communiqué, and brought a 40% market share threshold for vertical agreements.

The fact that very identical remedies were also foreseen for Coca Cola Satış ve Dağıtım ve A.Ş. ("Coca Cola Turkey") and Mey İçki Sanayi ve Ticaret A.Ş. ("Mey İçki") subsequent to the Authority's relevant investigations mentioned above is a clear signal of the Board's increasing sensitivity towards the dominant undertakings' commercial practices concerning both de jure and de facto exclusivity arrangements.

What is also certain is that the Board's approach in relation to commercial practices which are alleged to aim at creating de facto exclusivity -, is heavily inspired by the widely known The Coca Cola Company Undertaking which was given to the European Competition Commission in 2005. As all the competition law circles throughout the world may recall, the relevant commitments offered by The Coca-Cola Company and three major bottlers ("Coca Cola") related to carbonated soft drinks ("CSD") provide;

  • No more exclusivity arrangements. At all times, Coca-Cola customers will remain free to buy and sell carbonated soft drinks from any supplier of their choice. Where large, private sector customers or public authorities organize a competitive tender for their supplies and Coca-Cola provides the best offer, it can be the only CSD supplier.

  • No target or growth rebates. Coca-Cola will no longer offer any rebates that reward its customers purely for purchasing the same amount or more of Coca-Cola's products than in the past.

  • No use of Coca-Cola's strongest brands to sell less popular products. Coca-Cola will not require that a customer that only wants to buy one or more of its best-selling brands (e.g. regular Coke or Fanta Orange) also has to purchase other Coca-Cola products such as its Sprite or its Vanilla Coke. Similarly, Coca-Cola will no longer offer a rebate to its customers if the customer commits to buy these other products together with its best-selling products or to reserve shelf space for the entire group of products.

  • 20% of free space in Coca-Cola's coolers. Where Coca-Cola provides a free cooler to a retailer and there is no other chilled beverage capacity in the outlet to which the consumer has a direct access and which is suitable for competing CSDs, the outlet operator will be free to use at least 20% of the cooler provided by Coca-Cola for any product of its choosing

As back-to-back decisions of the Board with regard to the de facto exclusivity had inevitably raised the question of "how to conduct financing arrangements, target rebates in compliance with the Board's recent precedents" by the dominant undertakings, the Board's relatively satisfactory response to the relevant question was not late.

In its very recent (reasoned decision was published at the Authority's web-page on May 22, 2008) Mey İçki Burak Gıda decision, the Board attempts to draw the line for the conduct of financing arrangements and target rebates by the dominant undertakings. In this respect the Board held the followings;

  • Minimum purchasing commitments in the vertical agreements to be concluded by and between Mey Icki and sales points are altogether prohibited (regardless of whether it is made based on a previous reference period or not).

  • Minimum purchasing clauses set forth in such vertical agreements can only be deemed acceptable if it is designed on a non-obligatory basis (by way of the sales points' targeting to purchase and sell certain amounts rather than being obliged to do so.)

  • Financing arrangements should in no way co-relate with the targeted certain amounts by the sales points. In other words such incentive programs should be held separate from achievement of the sales points to the targeted certain amounts.

  • The Board always reserves the right to interfere in such arrangements if it concludes that Mey İçki intends to convert target rebates into loyalty rebates (either de facto or de jure basis).

A careful consideration of the new precedents reveals that the Board is getting more and more determined in its combat against unlawful conducts of the dominant undertakings.

The answer to the question of whether newly introduced principles serve these purposes remains to be seen. The relevant trend, however, corroborate the Board's intention to focus more on monitoring the dominant undertakings' legal and commercial practices.

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.

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.

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”

Related Topics
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must 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