Abuse of a Dominant Position Under Turkish Competition Law

This article examines the abuse of a dominant position under Turkish competition law. Competition law is the branch of law applied to secure and protect competition in economic activity. Turkish competition law, in particular, contains the statutes and regulations that protect competition in Türkiye and foster a healthy market environment. Among these rules is the prohibition on abusing a dominant position. Below, we set out the core principles that govern the abuse of a dominant position under Turkish competition law and illustrate them with real cases.

1. What Is a Dominant Position?

A dominant position is the situation in which an undertaking, or a sector, enjoys an advantage that lets it act independently of its competitors. An undertaking in a dominant position can set the prices of its goods and services, influence how its rivals price, and play a decisive role in the market.

2. Abuse of a Dominant Position

Where an undertaking in a dominant position acts to the detriment of its competitors or of consumers, in a way that prevents or restricts competition, this is called an abuse of a dominant position. Article 6 of the Act on the Protection of Competition No. 4054 (the "Act") is central here. Conduct amounting to an abuse of a dominant position is prohibited under the Act and can expose undertakings to administrative fines.

3. Core Principles

The core principles governing the abuse of a dominant position under Turkish competition law are the following:

• Fair competition. An undertaking in a dominant position must maintain a fair competitive environment with its rivals. Fair competition means a setting in which undertakings can set the prices of their goods and services, improve product quality, and offer consumers better service (see Article 4 of the Act).

• Preserving the competitive process. An undertaking in a dominant position plays a decisive role in the market and must therefore refrain from conduct that prevents or restricts competition (see Article 6 of the Act).

• Protecting consumers. An undertaking in a dominant position must avoid conduct that harms consumers. Consumers should have genuine choice on price, be properly informed about the quality of goods and services, and benefit from a fair competitive environment (see Article 3 of the Act).

4. Real Cases

There are many examples of the abuse of a dominant position in Turkish competition law practice. A few decisions of the Turkish Competition Board illustrate the point.

• Google — search (Board decision of 08.04.2021, No. 21-20/248-105). Google holds a dominant position in the search-engine market in Türkiye. Article 6 of the Act prohibits an undertaking in a dominant position from acting in a way that distorts competition. The Turkish Competition Authority found that Google had distorted competition by presenting its own search results ahead of those of rival search services and by giving priority to its own advertising services to the disadvantage of competitors. As a result of these infringements, Google was fined approximately TRY 296 million.

• Google — Android and Google Play (Board decision of 19.09.2018, No. 18-33/555-273). In 2016, the Turkish Competition Authority opened an investigation on the ground that Google had abused its dominant position in the Android operating system and the Google Play app store, placing its rivals at a disadvantage. The Authority found that, by requiring the Android operating system to be used together with Google's own services, Google had limited access for alternative app and service providers and distorted competition. Google was fined approximately TRY 93 million in 2018. In the same year, the European Commission imposed a fine of EUR 4.34 billion on Google for comparable conduct.

• Enerjisa — electricity distribution (Board decision of 08.08.2018, No. 18-27/461-224). Enerjisa's distribution companies hold a dominant position in electricity distribution, and its retail companies in the retail electricity-supply markets, across their respective regions. The Turkish Competition Authority found that Enerjisa had abused its dominant position — by making it harder for independent (competing) suppliers to operate and by impeding consumers' right to choose their own supplier — in breach of Article 6 of the Act, and imposed fines totalling approximately TRY 140 million following its investigation.

• Türk Telekom — telecommunications (Board decision of 19.11.2008, No. 08-65/1055-411). Türk Telekom, Türkiye's largest telecommunications company, holds a dominant position in the telecommunications market. By offering special pricing terms to certain competitors, it distorted competition. The Turkish Competition Authority found this to be an unfair pricing practice prohibited under Article 6 of the Act and fined Türk Telekom approximately TRY 12 million following its investigation.

These are only a few of the situations frequently encountered in Turkish competition law when it comes to the abuse of a dominant position. Such conduct is known to distort competition, reduce the market shares of other undertakings, and block consumers' access to good-quality, reasonably priced products. Article 6 of the Act therefore prohibits this kind of conduct by dominant undertakings. On identifying such conduct, the Competition Authority can impose administrative fines and can even take legal steps to bring the conduct to an end.

For this reason, it is important that undertakings avoid conduct that distorts competition and comply with the provisions of the Act. Consumers, in turn, may lodge a complaint with the Turkish Competition Authority to protect their rights. In this way, competition can be safeguarded and a fair market environment maintained.

5. What to Watch Before and During a Competition Authority Investigation

The Turkish Competition Authority is a public body established to ensure that undertakings operating in Türkiye act within the bounds of competition law. To that end, the Authority has the power to carry out on-site inspections (dawn raids). Using this power, it verifies whether undertakings are complying with competition law. On-site inspections involve visiting an undertaking's premises and examining its records and documents, with a view to detecting conduct that breaches competition law and applying the necessary sanctions. This power is an important tool for keeping business conduct within the framework of competition law.

While Turkish competition law is applied to secure and protect competition, the Authority's investigations — and the on-site inspections carried out during them — can have serious consequences for undertakings. Both before and during an investigation, undertakings must act in line with competition-law rules. Otherwise, they may face administrative fines for abusing a dominant position. Undertakings that wish to stay compliant should pay attention to the following:

• Keep up with the rules. Undertakings should continuously follow developments in Turkish competition law and conduct their business in line with them, reducing the risk of fines for abuse of dominance or other infringements.

• Carry out a dominance assessment. Undertakings should assess where they stand in the market and where they can compete, while making sure that any such assessment is itself carried out in a manner consistent with competition law.

• Run internal training. Undertakings should organise in-house training on competition law and keep their employees informed, so that day-to-day business is conducted lawfully.

• Monitor the competitive landscape. Undertakings should regularly monitor competition in the market and keep track of their rivals' activities, so that they can take precautions against abuse of dominance or other infringements in advance.

• Cooperate during investigations. During a Competition Authority investigation, undertakings should respond fully and accurately to the Authority's requests and cooperate. This can make the process smoother and help keep any fines to a minimum.

6. Conclusion

Turkish competition law matters for the healthy functioning of competition and the protection of consumers. Undertakings in a dominant position must compete without harming their rivals or consumers. The Turkish Competition Authority closely monitors the conduct of dominant undertakings, and the Board imposes serious sanctions. It is important that undertakings follow the legal framework and maintain a fair competitive environment in order to avoid infringements of competition law.

This article provides general information on Turkish competition law and does not constitute legal advice. For advice on a specific matter, please contact OKAB — Oğuz Kara Avukatlık Bürosu.