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Immunity and leniency
Immunity and leniency programmes
Is an immunity and leniency programme available for companies? If so, how does it operate?
Yes. The Regulation on Active Cooperation for the Discovery of Cartels (the Leniency Regulation) provides the main principles of available immunity and leniency programmes. The leniency programme is available only for cartel participants. A cartel participant can apply for leniency until the investigation report is officially served. Depending on the application order, there may be total immunity from, or reduction of, a fine. This immunity or reduction includes both the undertakings and its employees or managers, with the exception of the cartel ringleader, who can only benefit from a second-degree fine reduction.
Can the enforcement authority decline or withdraw leniency? If so, on what basis?
Although the relevant legislation does not set out rules on declining and withdrawing leniency, the Guidelines on the Clarification of the Regulation on Leniency (the Leniency Guidelines) state that the Competition Authority may decline a total immunity application if it already has enough evidence proving the cartel. However, the authority would consider the application as a request for a fine reduction.
Are there benefits for cooperators that do not qualify for immunity? If so, how are these benefits determined?
The first firm to file an appropriately prepared application for leniency may benefit from total immunity. The second firm to file an appropriately prepared application will receive a fine reduction of between 33% and 50%. The third applicant will receive a 25% to 33% fine reduction. Subsequent applicants will receive a 16% to 25% fine reduction.
Further, according to the Regulation on Fines, a party’s cooperation is a mitigating factor that the Competition Board can consider when determining the size of fine to be imposed. In such a case, if mitigating circumstances are established by the infringing party, the fine would be decreased by 25% to 60%.
What benefits (if any) are available for employees and former employees of a company that seeks leniency?
Employees of a cartel member also benefit from the leniency or immunity granted to the company.
Is an immunity or leniency programme specifically available for individuals? If so, how does it operate?
Individuals who perform an economic activity and act as an undertaking within the meaning of competition law can also benefit from a leniency programme if they take part in a cartel. Immunity or a leniency programme for these individuals would not differ from the abovementioned immunity and leniency programme for companies.
Have there been any notable recent cases in which a leniency application was the subject of adjudication?
The Competition Board’s most important recent decision regarding leniency applications was rendered in an investigation launched against 13 financial institutions – including local and international banks – active in the corporate and commercial banking markets in Turkey (November 28 2017, 17-39/636-276). The main allegations concerned the exchange of competitively sensitive information on loan conditions. To that end, the Competition Board resolved that Bank of Tokyo-Mitsubishi UFJ Turkey AŞ (BTMU) would not face an administrative fine pursuant to its leniency application, granting full immunity to BTMU – which had violated Article 4 of the Competition Law – while also relieving the other investigated undertakings from administrative fines.
Another significant decision of the Competition Board regarding leniency applications is Fresh Yeast (14-42/738-346, October 22 2014), which concerned four undertakings operating in the fresh yeast market. The board launched an investigation into four fresh yeast producers to determine whether they had violated Article 4 of the Competition Law by colluding to set the price of fresh yeast. Mauri Maya made a leniency application on May 27 2013 following the pre-investigation phase and dawn raids in order to benefit from Article 4 of the Leniency Regulation. The board resolved that the investigated companies had violated Article 4 and imposed a monetary fine on three of them and granted full immunity to Mauri Maya by virtue of the added value and sufficient content of its leniency application. Fresh Yeast serves as a landmark case, as it is the first instance in which the board granted immunity following dawn raids.
Is immunity from criminal prosecution available? If so, how and under what conditions is immunity granted?
What is the procedure for a leniency application?
In order to benefit from immunity or a reduction in administrative fines, the applicant must make a leniency application:
- before the opening of a preliminary investigation; or
- after the preliminary investigation has opened, but before an investigation report is officially served.
What is the typical timeframe for consideration of a leniency application?
The Leniency Regulation and the Leniency Guidelines do not refer to timeframes for Competition Board decisions on leniency applications. However, the board should decide on a leniency application before an investigation is completed.
What information and evidence is required?
Pursuant to the Leniency Regulation, in order for a cartel member to benefit from immunity or a fine reduction, the applicant must submit:
- information on the products affected by the cartel;
- information on the duration of the cartel;
- the names of the cartelists;
- the dates and locations of and participants in the cartel meetings; and
- additional information or documents about the cartel activity.
What information and evidence is disclosed to subjects of the investigation other than the leniency applicant?
Turkish courts can subpoena documents or information from public or private authorities and bodies, including the Competition Authority. The authority is constitutionally required to submit all information or documents requested by a Turkish court. Information or documents submitted as part of a leniency application can be subject to discovery orders in Turkish courts, which can consider if and to the extent that they amount to legitimate evidence. Failure to provide the information or documents requested by the court may trigger criminal consequences for the relevant Competition Authority officials.
Turkey is party to the Hague Conference on the Taking of Evidence Abroad in Civil and Commercial Matters 1970 and bilateral treaties with many other countries on similar matters. Subject to the terms and conditions of the applicable conventions and treaties, the competent authorities (ie, the Turkish courts or the Competition Authority, as the case may be) may be required to provide information or documents if the court seeks judicial assistance under the applicable convention or treaty.
What level of cooperation is required from applicants?
Applicants must submit all information and documents required. The required information may be submitted verbally. Admission of actual price effect is not a required element of a leniency application. Applicants must avoid concealing or destroying information or documents concerning the cartel activity. Unless the Leniency Division decides otherwise:
- applicants must cease taking part in the cartel; and
- applications must be kept confidential until the investigation report has been served.
Applicants must continue to cooperate with the Competition Authority actively until the final decision on the case has been rendered. Further, applicants must:
- present any new documents to the authority as soon as they are discovered;
- cooperate with the authority on additional information requests; and
- avoid statements that are contradictory to the documents submitted as part of the leniency application.
What confidentiality protection is offered to applicants?
As per Articles 6 and 9 of the Leniency Regulation, unless stated otherwise by the authorised division, the principle is to maintain the confidentiality of the leniency application until the notification of the investigation report. Nonetheless, if the confidentiality of the investigation will not be at risk, the applicants can provide information to other competition authorities, institutions, organisations and auditors.
Alternatively, the Competition Authority may keep the identity of the leniency applicant confidential until the service of the investigation report.
Can the company apply for a marker? If so, under which conditions?
Yes. Leniency is also available for markers. Although the Leniency Regulation provides no detailed principles on the marker system, the Competition Authority can grant a comity period to applicants to submit the necessary information and evidence. For an applicant to be eligible for a preparatory period, it must provide, at a minimum, information concerning:
- the affected products;
- the duration of the cartel; and
- the names of the parties concerned.
A document showing the date and time of the application and requesting time to prepare the required information and evidence will be given to the applicant by the assigned unit.
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