Foreign-to-Foreign Transactions under Turkish Merger Control Regime

Any transaction triggering the thresholds defined under Article 7 of Communiqué No. 2010/4 Concerning the Mergers and Acquisitions Calling for the Authorization of the Board (Communiqué No. 2010/4) is subject to a mandatory filing before the Turkish Competition Authority (Authority). Even though no specific deadline is set with regard to the timing of the filing, an explicit suspension requirement is set out under Article 11(1)(a) of Law No. 4054 on the Protection of Competition and Article 10(5) of Communiqué No. 2010/4. This suspension requirement dictates that the parties shall not close a notifiable transaction before obtaining the approval of the Turkish Competition Board (Board); therefore, the parties will be in violation if they do not notify such a transaction, or if they close said transaction while the assessment of the Board is yet pending.

The legal consequences of violation of the suspension requirement are also applicable to foreign-to-foreign transactions. In other words, when it comes to the violation of the suspension requirement, the Board does not treat the transactions differently in terms of sanctions and imposes administrative fines on foreign-to-foreign/pure offshore transactions as well. There is a high likelihood of detecting missed notifications even for foreign-to-foreign transactions. The Authority uses electronic databases and vigorously monitors the websites of other authorities (particularly the European Union (EU) and its neighbours) and international press and media outlets (e.g., Financial Times and the Wall Street Journal). The Authority cooperates also internationally with several antitrust authorities in other jurisdictions, including the United States Department of Justice and the European Commission, as it is empowered to contact certain regulatory authorities around the world in order to exchange information. Moreover, the Authority analyses former mergers and acquisitions in the course of each notification and will therefore scrutinize earlier transactions if it detects a notification requirement.

The risk of detection becomes higher when: (i) either party has previously filed a transaction in Turkey to the Authority or (ii) the parties envisage filing a transaction in Turkey in the near future (especially for transactions in the same sector) or (iii) where other filings are being made for the relevant transaction (especially if an EU filing is made).

For more information on foreign-to-foreign transactions in Turkish competition law, please feel free to reach out to ELIG Gurkaynak at +90 212 327 1724 or through gonenc.gurkaynak@elig.com.