Minority Shareholding in Turkish Merger Control Regime

Under Turkish merger control regime, acquisition of a minority shareholding may amount to a notifiable transaction if and to the extent it leads to a change in the control structure of the target entity. Control can be constituted by rights, agreements or any other means which, either separately or jointly, de facto or de jure, confer the possibility of exercising decisive influence on an undertaking. These rights or agreements are instruments which confer decisive influence; in particular, by ownership or right to use all or part of the assets of an undertaking, or by rights or agreements which confer decisive influence on decisions pertaining to the budget, the business plan, major investments, or senior management appointment. As specified under paragraphs 52 and 53 of the Guidelines on Cases Considered as a Merger or an Acquisition and the Concept of Control, such veto rights must be related to strategic decisions on the business policy, and they must go beyond normal “minority rights” protecting the financial interests of such shareholders.

The Turkish Competition Board’s (Board) approach to voting and negative control rights is very similar to, if not the same as the European Commission’s position.

While the acquisition of a minority stake not conveying any control rights would be outside the scope of merger control regime, the acquisition of minority rights in competing undertakings may potentially come under the scrutiny of the Board under Article 4 of Law No. 4054 on Protection of Competition, which is closely modeled on and akin to Article 101 of the TFEU, due to the possibility of facilitation of coordination raised by such shareholdings in rival undertakings.

For more information on the acquisition of minority rights in Turkey, please feel free to reach out to ELIG Gurkaynak at +90 212 327 1724 or through gonenc.gurkaynak@elig.com.