Agreements between companies aiming at or resulting in the prevention of the entrance of other companies to the market are prohibited as they lead to the elimination of potential competition. Such agreements deprive customers of an alternative source and the chance to benefit from lower prices.
The Turkish Competition Board defines “market barriers” as follows:
“barriers to market entry express the case where features of the relevant market are not appropriate for undertakings to newly enter the market”.
Entry barriers may result from an anti-competitive agreement among existing competitors. Such agreements to create or increase barriers to market entry are deemed to be per se illegal.
In this line of reasoning, agreements over IP rights or exclusive agreements may lead to market entry barriers. For example, exclusive agreements between specific suppliers and retailers of a certain product to not buy/sell products from other companies can prevent other retailers from entering the market; these agreements would result in a violation of Article 4 of the Competition Law.
Prevention of potential new entrance may also arise from the conduct of dominant companies. Further information on the dominant companies’ preventing potential new entrance to the market within the meaning of Article 6 of the Competition Law can be found under the section on “Market Foreclosure”.