Turkey: First Ever Settlement Decision In Turkish Competition Law: Turkish Competition Board Concludes The Investigation In The Small Household Appliances Sector With A Settlement Decision

After an investigation process of 8 months, the Turkish Competition Board ("Board") announced on August 9, 2021 on its website that it has concluded the investigation with a settlement decision which constitutes the first example of the newly introduced settlement procedure by the Turkish Competition Authority.

The Competition Authority's announcement is as follows:

"Within the scope of the investigation initiated via Competition Board's decision dated 07.01.2021 and numbered 21-01/9-M against Türk Philips Ticaret A.Ş., Dünya Dış Ticaret Ltd. Şti., Melisa Elektrikli ve Elektronik Ev Eşyaları Bilg. Don. İnş. San. Tic. A.Ş., Nit-Set Ev Aletleri Paz. San. ve Tic. Ltd. Şti. and GİPA Dayanıklı Tüketim Mamülleri Tic. A.Ş. in order to determine whether these undertakings have violated Article 4 of the Law on Protection of the Competition No. 4054, it was decided via the Competition Board's decision numbered 21-37/524-258 and dated 05.08.2021 that the investigation shall be concluded with settlement for Türk Philips Ticaret A.Ş., Dünya Dış Ticaret Ltd. Şti., Melisa Elektrikli ve Elektronik Ev Eşyaları Bilg. Don. İnş. San. Tic. A.Ş., Nit-Set Ev Aletleri Paz. San. ve Tic. Ltd. Şti. and GİPA Dayanıklı Tüketim Mamülleri Tic. A.Ş. upon the settlement letters submitted by the respective undertakings.

As known, within the scope of the settlement mechanism established to the competition law legislation by the amendment made on fifth sub-section of Article 43 of the Law on Protection of the Competition No. 4054 via Law No. 7246 on 16.06.2020, the Board could start the settlement procedure and decide to conclude the investigation, on the request of the parties concerned or on its own initiative, taking into account the procedural benefits that may arise from a rapid resolution of the investigation process and the differences in opinion concerning the existence and scope of the infringement.

Within that scope, the decision of the Competition Board regarding the aforementioned undertakings matters in terms of being the first decision implementing the settlement mechanism."

As highlighted in the announcement, the Competition Board's said decision is of utmost significance, since it represents the first instance where the settlement procedure, recently introduced with the amendment to the Law No. 4054, was triggered. Indeed, on March 18, 2021, the Competition Authority published the "Draft Regulation on Settlement Procedure to be Used during Investigations regarding Agreements, Concerted Practices and Decisions Restricting Competition and the Abuses of Dominant Position" and initiated the public consultation process to be ended on April 19, 2021. Accordingly, "the Regulation on Settlement Procedure to be Used during Investigations regarding Agreements, Concerted Practices and Decisions Restricting Competition and the Abuses of Dominant Position" was published on the official Gazette on July 15, 2021.

The decision is expected to set a landmark precedent on the Board's approach on the use of the settlement procedure and provide guidance for future settlement cases.

Gönenç Gürkaynak, Partner of ELIG Gürkaynak Attorneys-at-Law, representing Philips Turkey commented that: "We are proud that our file constituting the first precedent of the Turkish Competition Authority on settlement happens to be a very encouraging one."

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