REGULATION ON FINES TO APPLY
IN CASES OF AGREEMENTS, CONCERTED PRACTICES AND DECISIONS
LIMITING COMPETITION, AND ABUSE OF DOMINANT POSITION
General Preamble
(1) It is provided for under the Act No. 4054 on the Protection of Competition
(the Act), Article 16, paragraph three, that undertakings and associations of
undertakings which engage in behaviors prohibited under Article 4 and 6 of the Act
may be given fines up to ten percent of their annual gross revenues which generated
by the end of the fiscal year preceding the final decision or, if that cannot be
calculated, by the end of the fiscal year closest to the date of the final decision, and
which is to be determined by the Competition Board (the Board). It is ruled under the
Act, Article 16, paragraph five, that, in deciding the fine according to paragraph three,
the Board shall take account of points such as the repetition and duration of the
violation, market power of the undertakings or associations of undertakings, their
decisive influence on the occurrence of the violation, whether or not they conform to
the commitments made, whether or not they assist with the examination, and the
gravity of the damage which occurred or which is likely to occur.
(2) It is provided for under the Act, Article 16, paragraph four, that fines may
be given to the managers or employees of undertakings or associations of
undertakings, who are found to have had decisive influence on the violation, up to
five percent of the fine given to the undertakings or associations of undertakings
pursuant to paragraph three.
(3) It is ruled under the Act, Article 16, last paragraph, that the points taken
account of in the determination of fines shall be determined by regulations to be
issued by the Board. Article 27 of the Act gives the Board the duty and power to issue
communiqués and make the necessary regulations related to the implementation of
the Act.
(4) In line with the aforementioned clauses, to provide for the procedures and
principles relating to the fines to be given to undertakings and associations of
undertakings which engage in behaviors prohibited under Article 4 and 6 of the Act,
and their managers and employees, pursuant to Article 16, paragraphs three and
four, of the Act, this regulation, which shall be denominated as the Fines Regulation,
has been prepared. The goals intended to be accomplished by the Fines Regulation
is as follows:
a) Ensuring transparency, objectivity and consistency in fining process.
b) Taking account of such points as assistance with examinations and active
cooperation, while determining the fines, and thus promoting them.
c) Fines having the nature of ensuring special and general deterrence. Special
deterrence is the prevention of those undertakings, which are the addressee of fines,
from violating the Act. General deterrence is the deterrence of those undertakings
which are likely to violate the Act or which continue a violation that has not been
detected yet. In this context, fines should be determined as having the nature of
ensuring both types of deterrence.
REGULATION ON FINES TO APPLY
IN CASES OF AGREEMENTS, CONCERTED PRACTICES AND DECISIONS
LIMITING COMPETITION, AND ABUSE OF DOMINANT POSITION
(REGULATION ON FINES)
SECTION ONE
Purpose, Scope, Basis and Definitions
Purpose and scope
ARTICLE 1 – (1) The purpose of this Regulation is to provide for the
procedures and principles relating to the setting and assessment of fines to be given
to those undertakings and associations of undertakings or the members of such
associations, as well as managers and employees thereof, that engage in behaviors
prohibited under Article 4 and 6 of the Act No. 4054 on the Protection of Competition,
pursuant to Article 16 of the same Act.
Basis
ARTICLE 2 – (1) This Regulation has been drawn up based on Articles 16 and
27 of the Act on the Protection of Competition dated 7/12/1994 and numbered 4054.
Definitions
ARTICLE 3 – (1) In implementation of this Regulation, the terms express the
following:
a) Active Cooperation Regulation: the Regulation on Active Cooperation for
Detecting Cartels,
b) Other violations: the behaviors that are prohibited under Article 4 and 6 of
the Act on the Protection of Competition No. 4054 and which are outside the
definition of cartel.
c) Act: the Act No. 4054 on the Protection of Competition,
d) Cartels: competitionrestrictive agreements and/or concerted practices
between competitors for fixing prices; allocation of customers, providers territories or
trade channels; restricting the amount of supply or imposing quotes, and bid rigging.
e) The Board: the Competition Board,
f) The Authority: the Competition Authority,
g) Annual gross revenue: the net sales in the uniform account plan, or if this
cannot be calculated, the revenue closest to the net sales, which is to be determined
by the Board.
SECTION TWO
Principles, Base Fine, Aggravating and Mitigating Factors
Principles relating to the determination of fines
ARTICLE 4 – (1) In determining fines to be applied to undertakings and
associations of undertakings or members of such associations;
a) The base fine shall be calculated within the framework of Article 5 of this
Regulation. In case more than one independent behavior – in terms of market, nature
and chronological process – that are prohibited under Articles 4 and 6 of the Act are
detected, the base fine shall be calculated separately for each behavior.
b) Following the calculation of the base fine, aggravating and mitigating factors
shall be considered within the framework of Articles 6 and 7 of this Regulation, and
an increase and/or reduction shall be made.
(2) The amount of fine to be determined in accordance with the provisions of
this Regulation may not exceed ten percent of the annual gross revenue of the
undertakings and associations of undertakings or the members of such associations
to be fined, which generated at the end of the fiscal year preceding the final decision,
or if that cannot be calculated, by the end of the fiscal year closest to the date of the
final decision, and which shall be calculated by the Board. Fines exceeding this limit
shall be reduced to ten percent of the annual gross revenues of the undertakings and
associations of undertakings or the members of such associations to be fined; after
which, if the conditions exist, paragraphs two and three of Article 7 of this Regulation
and the provisions of Active Cooperation Regulation shall apply.
(3) Where undertakings or associations of undertakings are given the fines as
specified under paragraph three of Article 16 of the Act, the fine that shall apply to
the managers and employees of undertakings or associations of undertakings may
not exceed five percent of the fine given to the undertaking or association of
undertakings.
Base fine
ARTICLE 5 – (1) While the base fine is being calculated, a percentage:
a) for cartels, between two percent and four percent, and
b) for other violations, between five thousandth and three percent,
of the annual gross revenues of the undertakings and associations of
undertakings or the members of such associations, which generated at the end of the
fiscal year preceding the final decision, or if that cannot be calculated, at the end of
the fiscal year closest to the date of the final decision, and which shall be determined
by the Board, shall be taken as the basis.
(2) In the determination of the percentages written under paragraph one,
issues such as the market power of the concerned undertakings or associations of
undertakings, and the gravity of the damage which occurred or is likely to occur as a
result of the violation shall be considered.
(3) The amount of fine determined according to paragraph one;
a) shall be increased by half for violations which lasted longer than one year,
shorter than five years.
b) shall be increased by one fold for violations which lasted longer than five
years.
Aggravating factors
ARTICLE 6 – (1) The base fine shall be increased by half to one fold;
a) for each repetition in case of the repetition of the violation,
b) in case the cartel is continued after the notification of the investigation
decision.
(2) The base fine may be increased;
a) by half to one fold, where the commitments made for the elimination of the
competition problems raised within the scope of Article 4 or 6 of the Act are not met,
b) by up to half, where no assistance with the examination is provided,
c) by up to one fourth, where other undertakings are coerced into the violation.
Mitigating factors
ARTICLE 7 – (1) Provided the concerned undertaking or association of
undertakings proves that assistance with the examination has been provided apart
from the fulfillment of the legal obligations, there has been incentive by public
authorities or coercion by other undertakings concerning the violation, those who
were damaged have been indemnified voluntarily, the other violations have been
ceased, those activities which are the subject of the violation have a considerably low
share in the annual gross revenues; the base fine may be reduced by one fourth to
three fifth.
(2) In an ongoing investigation, the fine to be given to an undertaking which
cannot benefit from the arrangement for nonimposition of fines under the Active
Cooperation Regulation, shall be reduced by one fourth if it presents the information
and documents specified under Article 6 of the Active Cooperation Regulation before
the Board decides to conduct a preliminary inquiry into another cartel. The provisions
of the Active Cooperation Regulation for nonimposition of fines, or reduction in fines
to be given, are reserved.
(3) In case the undertakings or associations of undertakings that engaged in
the other violations acknowledge their violations and take active cooperation, the fine
shall be reduced by one sixth to one fourth.
Fines to be applied to managers and employees
ARTICLE 8 – (1) Each of the managers and employees of the undertaking
who were detected to have had decisive influence on the cartel shall be separately
given between three percent and five percent of the fine given to the undertaking,
taking into account points such as active cooperation.
(2) Fines shall not apply, or reductions shall be made in the fines to be given,
to those managers and employees of the undertaking which take active cooperation
with the Authority for the uncovering of cartels, within the framework of the provisions
of the Active Cooperation Regulation.
(3) Managers and employees of the undertaking or association of
undertakings, who were detected to have had decisive influence on the other
violations, may be given fines up to five percent of the fine given to the concerned
undertaking or association of undertakings. Those who actively cooperate with the
Authority for uncovering the violation of the law may not be fined or may be offered
reduction in fines to be given, taking into account the nature, effectiveness and timing
of the violation.
SECTION THREE
Provisional and Final Provisions
Ongoing investigations
PROVISIONAL ARTICLE 1 – (1) Provisions of this Regulation shall also be
applicable to the investigations that were initiated prior to its entry into force, where
the investigation report has not been notified.
Enforcement
ARTICLE 9 – (1) This Regulation, which has been drawn up after the opinions
of the Ministry of Finance and the Court of Accounts have been taken, shall enter into
force on the date of its publication.
Execution
ARTICLE 10 – (1) The President of the Competition Authority shall execute
the provisions of this Regulation.