Investigation and settlement

Legal representation

Under which circumstances would the company and officers or employees need separate legal representation? Do the authorities require separate legal representation during certain types of investigations?

Although not referred to in any competition legislation, an employee may seek external legal support if he or she faces action from his or her employer with the allegation that his or her own initiatives caused the subjected breach of competition law. An individual may also seek individual legal advice in cases where his or her employer forced the employee to breach competition rules and put him or her under a responsibility towards competition law. In such cases, an individual may apply for leniency or whistle-blowing under the guidance of the individual legal support.

Dawn raids

For what types of infringement would the regulatory authority launch a dawn raid? Are there any specific procedural rules for dawn raids?

The TCA frequently carries out dawn raids irrespective of the nature of the alleged infringement. Unannounced onsite inspections are used both at the pre-investigation and investigation stages.

The TCA may search the premises of the undertaking subject to investigation. TCA officials do not need authorisation from a court, but they must obtain authorisation from the TCA’s president defining the scope of the investigation. Those decisions indicate that an administrative fine will be imposed if incorrect information is provided. Authorisation from the court is required only if the undertaking concerned refuses to allow the dawn raid.

The TCA’s officials may, under article 15 of the Competition Law, enter the undertakings’ premises and means of transport; access electronic devices such as computers, business phones and laptops; examine and take copy of the books and other business records; and ask any representative or employee for explanations about facts or documents. The TCA’s officials are entitled to fully examine the computers, including all deleted items.

What are the company’s rights and obligations during a dawn raid?

The undertaking is obliged to allow the TCA’s officials to access the premises and conduct the investigation if a formal decision is taken by the TCA. There is no such obligation in the absence of a formal decision and the undertaking concerned may refuse the inspection without specifying any particular reason. If the undertaking voluntarily decides to allow the investigation, it will not be able to change its decision later on. In the presence of a formal decision, undertakings must allow the inspectors to conduct the dawn raid. If this is hindered, the undertaking will be subject to an administrative fine amounting to 0.5 per cent of its turnover of the preceding year.

One of the most significant decisions of the TCA regarding the obstruction of a dawn raid is the TTNET decision No. 13-46/601-M taken in 2013, where it was found that an employee deleted certain documents during the dawn raid, which led the TCA to impose a fine of 15,512,258 lira, corresponding to 0.5 per cent of the TTNET’s turnover.

Settlement mechanisms

Is there any mechanism to settle, or to make commitments to regulators, during an investigation?

Turkish law does not provide for a settlement procedure. The TCA may, at the stage of preliminary investigation, adopt a decision or warning stating that it would initiate a full investigation if the undertakings concerned do not modify or put an end to their agreements or conduct, and the parties should come up with effective commitments to be accepted by the TCA.

Settlements in the form of remedies are available within the scope of merger control. The TCA allows the undertakings concerned to propose remedies related to the transaction with a view to eliminating the competition concerns that may arise. At the same time, the TCA is entitled to impose requirements and obligations to ensure the fulfilment of such remedies.

What weight will the authorities place on companies implementing or amending a compliance programme in settlement negotiations?

As the TCA considers CCPs part of the remedies package in merger cases and more generally as a positive factor, the TCA may be expected to take into consideration existing CCPs in the context of the settlement procedure if the draft law mentioned in question 42 is passed.

Corporate monitorships

Are corporate monitorships used in your jurisdiction?

No, corporate monitorships are not used in Turkey.

Statements of facts

Are agreed statements of facts in a settlement with the authorities automatically admissible as evidence in actions for private damages, including class-actions or representative claims?

This remains to be seen once the settlement mechanism is introduced in Turkey. Currently, the civil courts suspend proceedings in actions for private damages until the TCA renders a decision confirming the competition law infringement. If the TCA finds an infringement, the civil courts must take this as given and they may not further assess whether the conduct of the defendant is unlawful or not. Private damages claims are tort claims, and the infringement decision of the TCA only proves the unlawfulness of the relevant conduct. The claimant must further prove the negligence of the infringer, its damages and the causal link between the unlawful conduct and its damages. There is no class action envisaged in Turkish law for the purposes of private enforcement in relation to competition law violations (as opposed to cases on consumer protection).

Invoking legal privilege

Can the company or an individual invoke legal privilege or privilege against self-incrimination in an investigation?

The undertaking (both the company and individual) may claim attorney-client privilege over any aspect of internal antitrust investigations that relates to the right of defence under certain conditions. Legal privilege in Turkey covers documents prepared by or correspondence with an independent external attorney that is directly related to the client’s right of defence (for example, a legal opinion on whether the agreement infringes competition law). If this is not the case, or if the purpose of the documents is to conceal or facilitate the violation (for example, discussions on how to apply the anticompetitive practices), the privilege cannot be invoked, and the documents concerned cannot be protected. The attorney-client privilege was confirmed by the TCA in its Dow decision No. 15-42/690-259 in 2015 stating that communications with an independent (with no employment relations with the client) attorney fall within the scope of attorney-client privilege and shall be protected from disclosure. As no statutory or regulatory rule provides for legal privilege, the TCA enjoys discretion in this respect.

In the Luxottica decision No. 17-08/88-38 in 2017, the TCA held that the undertakings’ responses to the information requests must be evaluated in the context of the privilege against self-incrimination. The TCA stated that the undertakings have a right to answer questions that are directly related to the essence of the investigations in parallel with their defences, and that it may not be claimed that these responses are misleading owing to the privilege against self-incrimination.

In the AYESAŞ case, TCA officials had seized a document that was prepared by AYESAŞ’s lawyers during a competition compliance programme as evidence in the investigation as it was not prepared for the purpose of exercising the right of defence within the scope of the on­going investigation (TCA decision No. 16-42/686-314 dated 6 December 2016). While the Administrative Court (Judgment No. E:2017/412 and K: 2017/3045 dated 1 March 2018) had annulled the TCA’s decision by holding that this document was covered by attorney-client privilege and that it could not be used as an evidence against AYESAŞ, the Regional Court (Judgment No. E: 2018/658 and K: 2018/1236 dated 7 January 2019) held that the document in question did not fall within the scope of the right of defence as there was no ongoing competition investigation when that document was drafted. Consequently, the concerned document was not directly linked to AYESAŞ’s exercise of its right of defence and could thus not benefit from attorney-client privilege.

Confidentiality protection

What confidentiality protection is afforded to the company and/or individual involved in competition investigations?

The undertakings involved in competition investigations are entitled to confidentiality protection. To that end, the concerned undertaking must make a written request to the TCA indicating the information and documents for which confidentiality is requested and the reasons justifying such a request. In addition, a non-confidential version of those information and documents must be provided together with the request. The TCA has discretion in deciding whether there are legitimate reasons to grant confidentiality. The TCA may, under Communiqué No. 2010/3 on Access to the File, request detailed explanations justifying the request.

In any event, the Competition Law prohibits the TCA’s officials from disclosing and using (in their own or others’ interests), even after their duties have ceased, the confidential information and trade secrets obtained in the performance of their functions.

Additionally, anyone submitting to the TCA information on alleged violations may request anonymity in accordance with Communiqué 2012/2. If this request is accepted, any information that may lead to the identification of the person concerned will not be mentioned in any correspondence, including within the TCA.

Confidentiality may also be regarded as a duty under the Leniency Regulation, according to which a leniency applicant, in order to be eligible for leniency, must, among other requirements, keep the application confidential until the end of the investigation, unless requested to do otherwise by the TCA.

Refusal to cooperate

What are the penalties for refusing to cooperate with the authorities in an investigation?

Refusal to cooperate with the TCA may take the form of obstructing, making it difficult to perform the on-the-spot inspection or failing to respond duly to information requests. In the case of obstructing the on-the-spot inspection, the TCA may impose an administrative fine of 0.5 per cent of the concerned undertaking’s annual gross revenues of the preceding financial year, whereas in the case of failing to respond duly to information requests or providing false information, the TCA may impose an administrative fine of 0.1 per cent of the undertaking’s annual gross revenues of the preceding financial year.

For instance, in its Poultry decision No. 19-12/155-70 dated 3 March 2019, the TCA resolved to impose a fine corresponding to 0.1 per cent of the following companies’ turnover of the previous year:

  • Bakpiliç for failure to provide the requested information and documentation as part of the investigation; and
  • Tad Piliç for providing false or misleading information.

It is important to emphasize that these companies did not violate the Competition Law in essence. Additionally, in its Mosaş decision No. 18-20/356-176 in June 2018, the TCA imposed administrative fines of 0.5 per cent because of hindrance of the on-the-spot inspection.

Infringement notification

Is there a duty to notify the regulator of competition infringements?

No statutory or regulatory rule provides for such a duty. Each natural person, institution or undertaking is entitled to apply to the TCA.

Limitation period

What are the limitation periods for competition infringements?

Eight years.