1. Introduction
The primary and most widely recognized function of
competition law is to ensure the preservation of effective competition in
markets and to prevent concentration transactions from distorting the
competitive structure. In this context, subjecting mergers and acquisitions to
prior control is regarded as one of the most important instruments of
competition law. In Türkiye, this control mechanism is carried out within the
framework of Law Nr. 4054 on the Protection of Competition, while the principal
secondary regulation guiding its implementation is the Communiqué Nr. 2010/4 on
Mergers and Acquisitions Requiring the Approval of the Competition Authority. As
is the case with many existing regulations, changes in economic conditions, the
growth in transaction volumes, and particularly the rapid transformation in the
technology sector have made it necessary to update the Communiqué on Mergers
and Acquisitions. Accordingly, the Competition Authority has introduced a
number of amendments to the Communiqué. These amendments are not limited to
mere technical updates; rather, they are of a nature that will directly affect
the scope, methodology, and intensity of merger and acquisition control.
2. A Comparative Analysis of the New and Former
Communiqués
One of the first notable aspects of the New Communiqué
is the clarification of the concept of “transaction party” within the scope of
merger and acquisition control. This is because the notion of a “transaction
party” plays a critical role in determining whether a merger or acquisition is
subject to notification requirements. Under the previous regulation, the fact
that this concept was defined in a general and limited manner led to
uncertainties in practice, particularly with regard to which undertakings would
be considered as parties in acquisition transactions. Particularly in complex
group structures involving a change of control, the determination of the
undertakings to be taken as a basis for notification has been open to differing
interpretations. Under the new regulation, however, the concept of “transaction
party” has been addressed in greater detail with respect to the undertaking
concerned by the transaction. In this context, it has been clearly established
that not only the direct parties, but also economic units within the same
control relationship, must be taken into account in the assessment.
This amendment has the potential to reduce
uncertainties in practice. Indeed, the clarification of the scope of the
notification requirement both enhances legal predictability for undertakings
and helps prevent unnecessary disputes before the Competition Authority.
As a reflection of changing economic conditions,
adjustments have been made to the turnover thresholds, which constitute one of
the most important criteria for determining mergers and acquisitions subject to
the notification requirement. Under the previous regulation, the thresholds had
not been updated for a long period, which, particularly in an environment of
high inflation and economic growth, resulted in an increasing number of
transactions falling within the scope of notification. Under the new regulation,
the turnover thresholds have been significantly increased. The individual
turnover threshold has been raised from 250 million TRY to 1 billion TRY, the
total turnover in Türkiye threshold from 750 million TRY to 3 billion TRY, and
the worldwide turnover threshold from 3 billion TRY to 9 billion TRY. The
primary purpose of this increase is to enable the Competition Authority to use
its control resources more efficiently and to ensure that only transactions
likely to have a significant impact on competition are subjected to review. Indeed,
subjecting low-volume transactions to the notification requirement imposes
unnecessary costs on undertakings and increases the workload of the Authority.
However, it can also be argued that raising the thresholds entails certain
risks. In particular, mergers among undertakings operating in local markets
with relatively low turnovers, although falling below the thresholds, may still
have significant effects on competition.
In recent years, one of the most debated issues in
competition law has been the inclusion of transactions involving the
acquisition of technology undertakings within the scope of control. In
particular, the acquisition of startups with relatively low turnovers but high
innovation potential is considered among the transactions referred to as “killer
acquisitions”, which may weaken competition in the long term. The previous
regulation, the exemption concerning technology undertakings could be applied
more broadly, whereas the new regulation limits this exemption to undertakings “based
in Türkiye”. It is also explicitly stipulated that certain turnover thresholds
will continue to apply to such transactions. This approach aims, on the one
hand, to protect domestic technology startups, while on the other hand, it may
have a narrowing effect on the scope of control. In particular, the possibility
that technology acquisitions carried out by foreign investors may, in certain
cases, fall outside the review process is a development that warrants careful
monitoring from a competition law perspective.
Joint ventures are considered hybrid structures in
competition law, encompassing both elements of concentration and cooperation.
Therefore, it is important to assess not only their effects on market structure
but also whether they give rise to anti-competitive coordination between the
parties. Under the previous regulation, this issue was not explicitly addressed
in the text of the Communiqué, and evaluations were largely based on practice
and guidelines. With the new regulation, a general framework for assessing the
coordination risk between the parent undertakings in joint ventures has been
incorporated into the text of the Communiqué. This amendment is significant in
terms of aligning Turkish competition law more closely with European Union
practice, as the coordination effects of joint ventures have long been treated
as a separate assessment in EU competition law. The new regulation paves the
way for the Competition Authority to conduct a more systematic analysis of such
transactions.
The notification process for mergers and acquisitions
constitutes a significant administrative burden for undertakings. The previous
Notification Form included extensive requests for information and documents,
requiring a substantial preparation process even for transactions with low
market shares. Upon the new regulation, the Notification Form has been
significantly simplified. Some information requests have been completely
removed, and in particular, the information required to be submitted for
transactions with low market shares in the affected markets has been reduced.
In addition, the regulation introduces measures to facilitate the notification
process for venture capital investment funds and similar investors. This change
can be regarded as a positive development in terms of reducing transaction
costs and improving the investment environment. A lighter bureaucratic burden
provides a significant advantage, especially in investment transactions that
require swift action.
Another significant innovation introduced by the new
regulation concerns transactions that are already under review. Accordingly, it
is explicitly stipulated that ongoing review processes may be terminated by a
Board decision if it is determined that the transactions do not meet the new
turnover thresholds or other notification requirements. This provision serves
an important function in terms of procedural efficiency. Preventing unnecessary
reviews enables the Authority to use its resources more efficiently and reduces
the period of uncertainty for undertakings.
3. Conclusion
The amendments to Communiqué Nr. 2010/4 aim to render
merger and acquisition control in Türkiye more selective, flexible, and aligned
with economic realities. In particular, the increase in turnover thresholds and
the simplification of the notification process provide significant conveniences
for both undertakings and the Competition Authority. At the same time, it is
likely that the regulations will give rise to new debates in certain areas. In
conclusion, while the general orientation of the amendments is aimed at
enhancing the effectiveness of competition law and making the control mechanism
more rational, the extent to which these objectives will be achieved will need
to be assessed in light of developments in practice.
Att. Melda İz
