Who Owns The Shelf: Insights From The Frito Lay Decision

The Turkish Competition Board’s (“TCB”) Frito Lay decision dated 13.02.2025 with number 25-06/152-78 marks a new peak in the Turkish antitrust practice, reflecting a stricter and more interventionist approach towards exclusivity practices at the retail level. In this decision, the TCB concluded that Frito Lay Gıda Sanayi ve Ticaret A.Ş. (“Frito Lay”) infringed Article 4 of Law No. 4054 on the Protection of Competition (“Law No. 4054”) by implementing a series of practices that effectively foreclosed competitors in the traditional retail channel. These practices resulted in an administrative monetary fine of TRY 1,365,467,533.01 (approx. USD 34.58 million or EUR 30.54 million¹).

Beyond the magnitude of the fine imposed, the decision is particularly significant for two reasons. First, the TCB decided to refuse the commitment procedure by exercising its discretion, despite the absence of a formal classification of the conduct as “hardcore”. Second, it imposed a set of detailed and far-reaching behavioural remedies that go well beyond conventional compliance measures. In particular, the TCB considered that a commitment-based resolution would be neither effective nor proportionate, given the extensive evidentiary record, comprising more than one hundred items; and Frito Lay’s longstanding exposure to similar allegations dating back to 2000.

The decision further emphasizes that the alleged practices were not individual or attributable to field-level discretion but were rather formed as a part of a deliberate and coordinated strategy implemented with the involvement of mid and senior level management. This finding ultimately led to the imposition of quasi regulatory obligations directly targeting retail level conduct. Most notably, the TCB imposed an obligation requiring Frito Lay to allocate at least 30% of the display space in retail outlets with a net sales area below 200 m² to competing products, which should remain physically reserved for competitors and cannot be filled with Frito Lay products even in cases where competing products are unavailable or temporarily out of stock.

Against this background, the Frito Lay decision constitutes a rare example of an intervention in a direct regulatory matter in shelf allocation and instore visibility. It should be noted that for the first time, shelf space allocation is requested to be physically reserved for the competitors, even where competing products are not available or they are temporarily out of stock at the sales point for whatsoever reason. Furthermore, this decision significantly expands the boundaries of de facto exclusivity and clarifies the limits of the commitment mechanism under Turkish competition law.

1. Procedural Background

The investigation was initiated following a complaint filed with the Turkish Competition Authority (“TCA”) on 06.11.2023, with the allegations that Frito Lay had abused its dominant position by restricting competitors’ access to retail outlets by means of practices reaching de facto exclusivity, and requested the adoption of interim measures. In its decision dated 21.03.2024, the TCB decided to launch a comprehensive investigation on the grounds that the conduct in question could constitute an infringement of Law No. 4054 by restricting competitors’ activities in the retail channel². However, the request for the application of interim measures was rejected based on the fact that the conditions set out under Article 9(4) of Law No. 4054; namely, the risk of serious and irreparable harm, were not satisfied.

Subsequently, by its decision dated 18.07.2024, the TCB rejected Frito Lay’s request to submit commitments, considering that the nature and the importance of the allegations rendered the commitment mechanism unsuitable in the circumstances)sup)3.

Following the oral hearing held on 04.02.2025, the TCB decided on 13.02.2025 that Frito Lay had infringed Article 4 of Law No. 4054, imposed an administrative monetary fine of TRY 1,365,467,533.01(approx. USD 34.58 million or EUR 30.54 million) and concluded the investigation.

2. Enforcement Background: A Pattern of Persistent Scrutiny

The 2025 decision reflects the culmination of more than two decades of continuous scrutiny by the TCB into Frito Lay’s conduct in the packaged chips market, thus cannot be assessed individually. Throughout this period, the TCB has consistently identified Frito Lay as the leading undertaking in the market and has examined a broad spectrum of potentially restrictive practices, ranging from below-cost pricing and exclusivity arrangements to resale price maintenance and coordination at the retail level. Against this background, the 2025 decision should not be regarded as a departure from the TCA's previous approach. It may be regarded as a natural continuation of an increasingly interventionist approach towards conduct that may foreclose competitors in highly concentrated markets. A brief overview of the TCB’s prior decisional practice further illustrates this evolution:

• In its 2000 decision⁴, the TCB assessed allegations of below-cost pricing in the mini chips segment. While the conduct was established, it was ultimately considered to be limited in both scope and duration and linked to the undertaking’s efforts to recover market share following capacity constraints caused by the earthquake; thus, no abuse of dominant position was found. However, an administrative fine was imposed due to the late notification of distribution agreements, and the TCB clarified that exclusivity clauses could benefit from the block exemption regime⁵ subject to compliance with the relevant conditions.

• In a subsequent decision in 2004⁶, the TCB found that exclusivity arrangements implemented both through written agreements and through practices producing equivalent effects fell outside the scope of the Block Exemption Communiqué No. 2002/2 on Vertical Agreements. As a result, the previously granted exemption was withdrawn, and Frito Lay was required to revise its contractual framework and ensure that its commercial practices did not give rise to de facto Although a later reassessment following a partial annulment decision confirmed Frito Lay’s dominant position, no abuse was ultimately established.

• In its 2013 decision⁷, however, the TCB concluded that Frito Lay had infringed Article 4 of Law No. 4054 through practices aimed at securing exclusive sales at the retail level and determined that such conduct could not benefit from an individual exemption.
• On the contrary, in its 2018 decision⁸, the TCB could not find sufficient evidence to support allegations of de facto exclusivity and resale price maintenance. The absence of structural barriers to entry and the observed loss of market share during the relevant period led the TCB to conclude that there were no grounds to initiate a full investigation for abuse of dominance.

• More recently, in its 2022 decision⁹, the TCB determined that Frito Lay had participated in a hub-and-spoke cartel by facilitating price coordination among retailers and engaging in resale price maintenance and imposed an administrative monetary fine accordingly.

Taken together, this decisional history reveals two key elements: the persistence of Frito Lay’s dominant position over a prolonged period, and a recurring pattern of concerns relating to exclusionary conduct at both the distribution and retail levels. The 2025 decision therefore represents a point at which these concerns crystallised into a more intrusive enforcement response.

3. The TCB’s Substantive Assessment

The TCB’s investigation focused on four main categories of conduct: (i) exclusivity practices implemented at retail outlets, (ii) the “Dükkan Senin” digital platform, (iii) the installation of PO1 integrated display stands, and (iv) the “KazandıRio” digital application, examined in the context of predatory pricing allegations.

While no infringement was established in relation to KazandıRio, the TCB concluded that the first three categories of conduct, when assessed collectively, resulted in the creation and reinforcement of de facto exclusivity at the retail level, thereby infringing Article 4 of Law No. 4054.

3.1 Exclusivity Practices at the Retail Level

i. De Facto Exclusivity Through Retail Practices

The evidence gathered during the investigation indicate that, between 2018 and 2024, Frito Lay pursued a systematic strategy aimed at restricting competitors’ access to retail outlets in the traditional channel¹⁰. This strategy did not mainly rely on explicit contractual exclusivity clauses, but it was implemented by means of a set of coordinated field practices giving rise to de facto exclusivity.

On-site inspections revealed a consistent pattern of conduct for the purposes of limiting competitors’ visibility and access, by way of;

• the removal of rival display stands and the reduction of competitors’ product visibility at the point of sale,
• stock loading practices aimed at occupying available shelf and storage space with Frito Lay products,
• the provision of financial or commercial incentives conditional on exclusivity, and
• the systematic disadvantaging of retailers that continued to offer competing products, particularly in terms of supply conditions and access to incentives.

The TCB found that these practices produced a clear foreclosure effect in the market, when assessed cumulatively. A key element of its reasoning lies in the nature of the product as packaged chips were characterized as “impulse purchase” goods, meaning that the consumer’s choice is largely determined at the point of sale. As a result, restrictions on shelf space and product visibility were considered particularly capable of breaching competition by preventing rival products from reaching consumers altogether.

The TCB also rejected the argument that these practices could be attributed to independent distributor behaviour. On the contrary, it is concluded that they were implemented under the knowledge and approval of Frito Lay’s management and were reinforced through internal incentive and bonus mechanisms, thus rendering the conduct directly attributable to the undertaking.

ii. The “Dükkan Senin” Platform: Loyalty and Exclusionary Effects

The TCB assessed the Dükkan Senin digital platform as a personalized rebate and loyalty mechanism with the potential to generate exclusionary effects when implemented by a dominant undertaking in a market with high entry barriers. The system allowed for discretionary and non-transparent allocation of benefits increases the risk of strategic use, unlike standardized or volume-based rebate schemes.

Evidence obtained by the TCB during on-site inspections demonstrated that the allocation of points was not purely performance-based, but could be used to incentivise conduct such as (i) removing competitors’ display stands, (ii) reducing the visibility of rival products, or (iii) terminating commercial relationships with competing suppliers. The benefits granted under the scheme were often provided in indirect forms; such as vouchers or fuel points, further reducing price transparency and complicating competitive assessment.

Given its broad scope and sustained implementation during 2022–2023, the TCB concluded that “Dükkan Senin” functioned not merely as a commercial incentive tool, but as an instrument in establishing and reinforcing de facto exclusivity in the traditional retail channel.

iii. PO1 Integrated Display Stands

The TCB’s assessment of PO1 integrated display stands focused on their structural and economic impact on the competition at the retail level. These stands involved significant, tailor made investments secured through standard agreements, often coupled with deterrent mechanisms such as penalty clauses. While the agreements did not formally impose exclusivity, the TCB considered that their practical effects could be equivalent.

In particular, the combination of (i) the size and fixed nature of the stands, and (ii) the limited space available in traditional retail outlets, was found to significantly restrict competitors’ ability to secure display space. Evidence obtained during on-site inspections further showed that the increasing prevalence of these stands frequently reduced or completely eliminated the visibility of competing products.

The TCB also focused on the fact that the cost and scale of such investments could not be easily replicated by competitors and resulted in reinforcing existing entry barriers. More importantly, with a holistic approach, the TCB considered the interaction between the structural constraints created by the stands and the relevant field practices; such as product removal, stock loading and incentive, based steering, which together produced exclusionary effects in practice.

Within the framework of the above assessments, the TCB concluded that PO1 stands formed an integral component of Frito Lay’s broader exclusivity strategy and contributed to the foreclosure of competitors in the traditional retail channel.

3.2 Predatory Practices: The “KazandıRio” Application

The “KazandıRio” mobile application was assessed within the framework of alleged predatory pricing.  However, the TCB’s economic analysis did not support the existence of below-cost pricing or exclusionary price effects.

The factors determined by the TCB were as follows: First, the costs associated with the campaign constituted only a limited portion of Frito Lay’s overall turnover. Second, the relevant sales remained profitable, and third, the incremental revenues generated through the campaign exceeded the associated costs. In addition, the scope of the application was relatively narrow, being limited to certain product categories and reaching only a segment of the consumer base.

The TCB also observed that both Frito Lay and its closest competitors maintained stable profit margins throughout the relevant period, further indicating the absence of price-based foreclosure effects.  In light of these findings, the TCB concluded that the KazandıRio application did not give rise to an infringement under Law No. 4054.

4. When Commitments Are Not Enough: The TCB’s Refusal to Engage in a Commitment Procedure

A central aspect of the decision lies in the TCB’s refusal to engage with the commitment mechanism. Frito Lay’s commitment application was assessed under Communiqué No. 2021/2 on the Commitments¹¹, yet the TCB ultimately declined to initiate a commitment procedure.

In its reasoning, the TCB emphasized that the competition concerns, particularly those related to exclusivity in the traditional retail channel, were supported by a substantial body of evidence and indicated a longstanding pattern of potentially infringing conduct extending over several years.

Although the conduct was not formally classified as “hardcore”, the TCB reiterated that the acceptance of commitments falls within its discretionary powers and does not operate automatically. Moreover, the TCB further considered that the alleged practices constituted a coherent and interrelated strategy centred on exclusivity, and that commitments would therefore be insufficient to eliminate the competition concerns in an effective and timely manner. In this assessment, Frito Lay’s extensive decisional history and the existence of more than one hundred evidence on file were also taken into account as factors justifying the rejection of the commitment request.

 5. Behavioural Remedies: A Shift Towards Direct Market Intervention

The TCB imposed a detailed and prescriptive set of behavioural remedies aimed at restoring competitive conditions in the packaged chips market, instead of relying solely on general compliance obligations. These measures were required to be implemented within one month following the service of the reasoned decision.

In essence, the TCB required Frito Lay to:

i. Cease exclusivity-linked incentives: All financial and commercial benefits; such as discounts, rebates and advantages provided under the Dükkan Senin scheme, should no longer be conditional on exclusivity.

ii. Restructure internal incentive mechanisms: Employee bonuses should be revised to ensure that they do not encourage conduct, limiting the visibility or availability of competing products, and that employees refrain from interfering with competitors’ product placement.

iii. Guarantee access to display space: In retail outlets with a net sales area below 200 m², at least 30% of Frito Lay’s display space should be allocated to competing products. This space should be clearly separated, properly labelled and left empty where competing products are not available.

iv. Limit instore dominance: The number of stands and promotional materials placed within a single outlet should be restricted, and any form of direct or indirect interference with competitors’ product placement must be avoided.

These remedies represent a notable departure from the TCB’s earlier, more restrained approach to exclusivity practices at retail level. Indeed, unlike previous cases; such as 2021 Coca-Cola or Unilever¹², where minimum space allocation obligations were imposed, the Frito Lay decision goes further by requiring that the allocated space remain empty, if necessary, thus preventing the dominant undertaking from reclaiming visibility through arguments based on the absence of competing products.

Taken together, the TCB’s findings and remedies indicate that, in markets characterised by strong brands, impulse purchasing behaviour and limited alternative routes to market, foreclosure risks may persist unless access conditions are actively and concretely restored at the point of sale. The remedies therefore prioritise the protection of the competition itself, ensuring that competitors retain a meaningful ability to access consumers, even in the absence of immediately observable consumer harm. To maintain effective implementation, the TCB also introduced monitoring and compliance mechanisms, including notification obligations towards retail customers, periodic reporting requirements and a formal review of the measures after two years.

6. The Empty Shelf Principle: Frito Lay as a Conceptual Turning Point

The behavioural remedies imposed in Frito Lay represent more than an incremental extension of the TCB's established practice on shelf allocation by marking a qualitative departure from it. In prior decisions, most notably 2021 Coca-Cola and Unilever, the TCB's physical access remedies operated on a relational logic. Previously, a portion of the dominant undertaking's refrigerators or display equipment was to be made available to competing products where a rival sought to place them. Where no rival product was available, the allocated space could revert to the dominant supplier.

The Frito Lay decision severed this link. Indeed, the requirement that 30% of Frito Lay's display space remain reserved for competing products and be left empty rather than filled with Frito Lay products where rival products are absent, cannot be read as a mere access remedy. It reflects a precise diagnosis of the market dynamics at play. Frito Lay's logistical superiority, maintained by daily replenishment against the competitors' weekly delivery, meant that any empty space would immediately be used by its own inventory. The TCB's response was therefore structural, not merely opening the shelf to rivals, but holding it open against the dominant firm itself, preserving the physical preconditions for competition regardless of whether any competitor is currently present.

This remedial logic has gone beyond the packaged snacks sector. The TCA's 2026 decision¹³ regarding the interim measures to be applied in the investigation against Unilever Sanayi ve Ticaret Türk A.Ş. (“Unilever”) and Magnum Dondurma A.Ş. (“Magnum”) concerning alleged non-compliance with the earlier Unilever decision applies the same framework to the ice cream market. At qualifying sales points with a closed net sales area of 100 m² or less where no freezer other than Unilever’s is present, 30% of Unilever's freezer volume must be reserved in the form of a single contiguous block, clearly labelled as reserved for competing products, and left empty in their absence, with the reserved proportion extendable up to 50% at the sales point's request.

With regard to exclusivity practices and the exclusion of competitors at the retail level, the most recent TCB decision is the investigation concerning Coca-Cola¹⁴, which was concluded through commitments. This decision goes significantly beyond the commitments accepted in 2021 Coca-Cola, both in scope and the in the stringency of the requirements.

In particular, the TCB required that 35% of Coca-Cola’s coolers at sales points in the traditional channel and the on-premise consumption channel be vertically separated, labelled and allocated to competing products, provided that the sales point does not own a cooler for non-alcoholic commercial drinks that is directly accessible to consumers. Moreover, the TCB required that the 35% access rule be calculated on the basis of each cooler when a sales point has more than one Coca-Cola cooler.

Furthermore, unlike the 2021 decision, the TCB removed the 100 m² threshold and increased the allocation requirement from 25% to 35%, thereby establishing the highest proportion of cooler space reserved for rival products imposed in the TCB’s decisional practice to date.

Among the significant commitments, and one for which there is no prior precedent in the TCB's decision-making practice, was the requirement regarding the reduction of orders. According to the commitment, the volume of orders supplied to the sales point shall be progressively reduced by 10% for each further instance of non-compliance in cases where a sales point continues to breach the access rule despite an initial warning. Moreover, this commitment extends beyond addressing Coca-Cola's exclusionary practices in the traditional channel, as it carries the potential for sales points to face commercial consequences in the event of non-compliance with the access rules.

Another noteworthy commitment concerns the premium practices applicable to Coca-Cola's sales personnel. Under this commitment, the bonuses for Area Sales Managers shall be terminated, while the base salary rate will be increased to 80% of total remuneration and the variable, performance-based pay will be capped at 20% in the total pay for Field Sales Managers and Sales Representatives. Given that the incomes of sales personnel have traditionally depended predominantly on sales performance and are related to bonus payments, this commitment is particularly significant from the employees’ perspective as it substantially alters the balance between fixed and incentive-based remuneration.

In this context, the commitments set out in 2026 Coca-Cola are far more finely tailored and considerably more burdensome than both the requirements in Frito Lay and the interim measures in the Unilever/Magnum.

The TCB’s recent decisions across sectors also confirm that Frito Lay is not an isolated response to a single undertaking's conduct, but the articulation of a broader enforcement model under which the TCB is prepared to impose unconditional structural reservations on dominant undertakings' physical assets in order to preserve the conditions for future competition at the point of sale. The decision further demonstrates the TCB’s willingness to impose increasingly intrusive and detailed behavioural remedies on dominant undertakings in order to safeguard competitors’ visibility and access at the point of sale.

7. Conclusion

The Frito Lay decision clearly shows that the TCB is approaching to exclusivity practices at the retail level in an increasing manner, particularly in markets where suppliers enjoy significant market power. It confirms that exclusivity may arise not only through explicit contractual provisions, but also through a combination of incentive structures, digital tools, shelf allocation practices and coordinated field activities that collectively restrict the access of the competitors to the market.

The decision is also significant for its procedural dimension. Having faced with a substantial evidentiary record and a repeated pattern of conduct, the TCB exercised its discretion to reject the commitment mechanism, signalling that commitments will not be accepted where they are unlikely to address competition concerns in a timely and effective manner. Perhaps most notably, the decision demonstrates the TCB’s willingness to adopt highly interventionist remedies directly targeting the dynamics at the retail level. Indeed, by regulating shelf allocation, loyalty mechanisms and instore equipment, it has effectively extended its enforcement reach into the physical organisation of retail space.

When these elements are taken into consideration together, it may be suggested that undertakings with a history of competition law scrutiny and particularly those relying on complex exclusivity strategies, may face not only infringement findings, but also intrusive and quasi regulatory obligations where foreclosure risks are identified. In this respect, the Frito Lay decision clearly highlights the direction of Turkish competition law enforcement by means of a readiness to combine substantive findings, procedural discretion and structural-like remedies in order to address persistent and systematic exclusionary strategies at the retail level.

The TCA's Unilever/Magnum investigation for non-compliance with previously imposed behavioural remedies and the structural reservation obligations introduced in that context, as well as the 2026 Coca-Cola decision on the commitments aimed at eliminating the exclusionary effects on competitors indicate that, the principles crystallized in Frito Lay are likely to shape Turkish competition law enforcement well beyond the decision itself, yet these early signs suggest that this enforcement posture is already taking hold beyond the snacks sector.

Footnotes

1. The amounts in USD and EUR for the year 2025 are converted at the exchange rate USD 1 = TRY 39.48 and EUR 1 = TRY 44.71 in accordance with the applicable Turkish Central Bank average buying rates for 2025.

2. The TCB’s decision dated 21.03.2024 with number 24-14/291-M.

3. The TCB’s decision dated 18.07.2024 with number 24-30/709-M.

4. The TCB’s decision dated 29.02.2000 with number 00-9/89-44.

5. The Block Exemption Communiqué No. 1997/3 on Exclusive Distribution Agreements.

6. The TCB’s decision dated 04.05.2004 with number 04-32/377-95.

7. The TCB’s decision dated 29.08.2013 with number 13-49/711-300.

8. The TCB’s decision dated 12.06.2018 with number 18-19/329-163.

9. The TCB’s decision dated 15.12.2022 with number 22-55/863-357.

10. According to the relevant decision, Frito Lay’s competitors are as follows: Doğuş, Pringles, Peyman, Aydın, Nazlı and others.

11. Communiqué on the Commitments to be Offered in Preliminary Inquiries and Investigations Concerning Agreements, Concerted Practices and Decisions Restricting Competition, and Abuse of Dominant Position (“Communiqué No. 2021/2”).

12. See, for instance, the TCB’s Coca Cola Satış ve Dağıtım A.Ş. (“Coca-Cola”) decision (dated 02.09.2021 with number 21-41/610-297), where the TCB imposed a 25% shelf space allocation requirement for competitors in soft drink coolers; and the Unilever decision (dated 18.03.2021 with number 21-15/190-80), which mandated a 30% visible space allocation for competitors in ice cream freezers. However, unlike the present Frito Lay decision, these precedents did not explicitly mandate that the allocated space must remain vacant and empty in the temporary absence of rival products. The imposition of such a strict vacancy rule in Frito Lay marks a significantly more interventionist approach designed to prevent the dominant undertaking from recapturing the shelf space under the pretext of stock unavailability.

13. The TCB’s decision dated 22.04.2026 with number 26-15/434-162 (“Unilever/Magnum”).

14. The TCB’s decision dated 04.06.2026 with number 26-20/614-243 (“2026 Coca-Cola”). Please note that the reasoned decision has not yet been published as of the date of this article.

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