Specialization Agreements in Turkish Competition Law

Block Exemption Communiqué No. 2013/3 on Specialization Agreements (Communiqué No. 2013/3) establishes the conditions for granting block exemptions to specialization agreements between undertakings and extends this exemption to licensing or intellectual property transfer agreements that are directly related to, or necessary for, the functioning of the exempted specialization agreements. The purpose of the Communiqué No. 2013/3 is to establish the conditions for granting block exemption to specialization agreements between undertakings from the application of the provisions of Article 4 of Law No. 4054 on the Protection of Competition.

The specialization agreements are described in Article 5 of the Communiqué No 2013/3. Within this scope, (i) Unilateral specialization agreements, where one of the parties which are active in the same product market agrees to fully or partly cease production of certain products or refrain from producing those products and to purchase those products from a competing undertaking, and at the same time, the competing undertaking agrees to produce or supply those products, (ii) Reciprocal specialization agreements, where two or more undertakings which are active in the same product market agree, on a reciprocal basis, to fully or partly cease or refrain from producing certain but different products and to purchase these products from the other parties, who agree to produce and supply them, and (iii) Joint production agreements, where two or more parties which are active in the same product market or which wish to enter a product market via a specialization agreement agree to produce certain products jointly.

In any event, unilateral or reciprocal specialization agreements, as well as joint production agreements that include certain commercialization activities such as joint distribution, are covered by the Communiqué No. 2013/3, provided that the combined market share of the parties in the relevant market or markets do not exceed 25% and that the other conditions listed in the Communiqué No. 2013/3 are fulfilled. However, the presence of the following elements causes the relevant agreements to fall outside the coverage of the block exemption according to Article 6 of Communiqué No. 2013/3: (i) maintenance of the sale price to third parties, except for direct purchasers, in the case of joint production agreements, (ii) any sharing of territories or customers, or (iii) the limitation of production or sale amounts. Mutual or one-sided specialization agreements may contain provisions regarding the relevant product volume, and for joint production agreements to set the production capacity or volume, or sale targets in the case of joint distribution.

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