The Competition Board recently rendered its decision regarding Turkcell Iletisim Hizmetleri AS, Turkey's largest Global System for Mobile Communications (GSM) operator. In November 2010 the board launched an investigation against Turkcell in order to determine whether Turkcell's practices towards its distributors and dealers in the GSM market violated Articles 4 and 6 of the Competition Law.

The board decided that Turkcell enjoyed a dominant position in the GSM services market. The board rejected claims that Turkcell was setting the resale prices of its distributors and dealers. However, it decided that Turkcell's practices with respect to standardising the decoration, signboards and sales of dealers, via vertical agreements and oral communications, prevented the sale of the products of alternative undertakings. Thus, Turkcell was found to be abusing its dominant position and a record fine of TRY91.1 million (around €40 million) was imposed. The fine is the highest ever imposed by the board against a single undertaking, amounting to around 1.125% of its 2010 turnover. The board also ordered Turkcell to cease such anti-competitive practices and amend its vertical agreements to comply with the Competition Law.

This is not the board's first decision to fine Turkcell. Turkcell had been previously fined by the board three times, for abusing its dominant position in the GSM services market in 2003, 2005 and 2009.

For further information on this topic please contact Gonenc Gürkaynak at ELIG by telephone (+90 212 327 17 24), fax (+90 212 327 17 25) or email (gonenc.gurkaynak@elig.com).