The Turkish Competition Board has outlined principles for assessing competition law violations regarding indirect information exchanges in terms of hub and spoke exchanges. The Board’s decision was given upon a complaint (dated 3 August 2015) alleging competition law violations by three major competitors in the tyre sector.
The complainant claimed that three major tyre manufacturers violated competition laws by exchanging information about tyre sale units and negotiating price increases.
The Board evaluated two aspects of the information exchanges.
Information exchanges made by the distributors of competitors
The Board referred to criteria determined by UK Competition Appeal Tribunal’s Tescodecision. Accordingly, competition would deemed as restricted if:
– Competitors in the upstream market disclose future pricing information to their distributors with the intention of affecting the market behaviour of other market players,
– Distributors disclose the acquired information to other market players in the upstream market, and
– Upstream market players determine their pricing policies using such disclosures.
The Board also emphasized that practices should be examined to assess whether their object is to restrict competition. Accordingly, the Board also considered whether the information exchange is strategic and could be performed through another source.
In the present case, the Board concluded that distributors disclosed the information to competitors in the upstream market with the intention of bargaining. Accordingly, the distributors’ practice was not intended to restrict competition.
Information exchanges made through research companies and associations of undertakings
The Board held that disclosure of consolidated historic data does not have the object of restricting competition.
However, the Board held that information exchanges made through research companies and sectoral associations are deemed to restrict competition if:
- Commercially sensitive competitive information is disclosed,
- The data’s characteristics are important in terms of market structure, frequency of disclosure, disclosed information’s market coverage and participation, and
- The anti-competitive effects of the violation can be observed in the market.
In the present case, the effects of the information exchange could not be determined.
Accordingly, the Board decided not to initiate an investigation because:
- There is no written agreement or evidence to suggest that the object of the alleged conduct is to restrict competition.
- Distributors make the information exchange indirectly and some disclosures are made outside control of the competitors in the upstream market.
You can read the full text of the Competition Board’s recent decision at this link (only available in Turkish)
Information first published in the MA | Gazette, a fortnightly legal update newsletter produced by Moroğlu Arseven.