Yağmur Karahan

Avukat

28.05.2021

THE ERA OF "DE MINIMIS" IMPLEMENTATION IN COMPETITION LAW

I.  De Minimis Concept
“De Minimis” principle, which is accepted in the European Union legislation, is a principle that ensures that negligible agreements remain out of control in the audit of implementations that limit competition. The concept roots back to "de minimis non curat praetor" in Roman Law; which is basically the principle of "The judge should not be kept busy with small matters, the law does not deal with small matters".
 
The aim of De Minimis principle is to get the audit authorities to work on material infringements and to prevent the audit authorities from wasting their time for agreements and actions that do not drastically limit competition.
 
II.  De Minimis Prensiple in Turkish Competition Law
The principle in the EU legislation has taken its place in Turkish Law with the amendment made in Article 41 of the Act on the Protection of Competition numbered 4054 and came into force on 24/06/2020. Pursuant to the article; “Commission; Except for clear and solid infringements such as price determination between competitors, distribution of regions or customers, and restriction of supply on the basis of criteria such as market share and turnover; an agreement, concerted action and decisions and actions of the association of undertakings that do not drastically limit competition in the market, may not be subject to investigation. The processes and principles regarding the implementation of this paragraph are determined by the notification issued by the Commission. " Although the principle in question took its place in Turkish Law with this law article in 2020, the notification on the procedures and principles of the implementation was published on 16/03/2021 and put into force.
 
III. Notification No. 2021/3 on Agreement, Concerted Action and Decisions and Actions of the Association of Undertakings that Do Not Limit Competition Significantly
As elaborated on in Article 1 of the Notification, the purpose of it is; Except for clear and solid infringements, it regulates the procedures and principles regarding agreements, concerted actions and decisions and actions of association of undertakings that may not be subject to investigation by the Competition Commission due to the fact that it does not drastically limit competition in the market. According to the notification, clear and solid infringements are exempted from the de minimis principle. Hence, what should be understood from the concept of clear and solid infringements should be known.
 
Clear and solid infringements pursuant to Article 4 of the Notification; refer to the following articles that aim to directly or indirectly prevent, spoil or limit competition in a product or service market, or that cause or may somehow cause this effect;
 
1)     Price fixing between competitors; sharing of customers, providers, regions or trade channels; limiting the amount of supply or setting quotas, collusion in auctions, sharing of areas that are susceptible to competition, such as the price, production, or amount of sales that are planned to be implemented in the future.
 
2)     Designating the fixed or minimum selling price of the buyer in the inter enterprise relationships which operate at different levels of the production or distribution chain, agreements and / or concerted actions, and the decisions and actions of the association of undertakings regarding these issues.
 
According to the Notification, clear and solid infringements were exempted, and “agreements and decisions that do not significantly limit competition” were designated as criteria for the implementation of the minimis principle. According to Article 5 of the Notification, these agreements and decisions are basically considered under two headings, those made between rival undertakings and those not made. Accordingly, it is accepted that competition will not be significantly limited in the following cases, with the exception of clear and solid infringements; 
 
a)     In agreements made between competing undertakings, the total market share of the parties to the agreement does not exceed 10% in any of the relative markets under the agreement,
b)     In agreements made between non-competitors, the market share of each of the parties to the agreement does not exceed 15% in any of the relative markets under the agreement.
 
 
Nevertheless, if it cannot be identified whether the agreements made according to the continuation of the article are among the competing undertakings or not, and if the total market share of the parties of the agreement does not exceed 10% in any of the relative markets affected by the agreement, it has been designated that the "de minimis" can be implemented.
 
A separate rate has been set for vertical limitations in the notification. If the parallel networks created by vertical limitations cover more than 50% of the relative market, the market share in agreements between both competitors and non-competitors must be below 5% in order to benefit from the implementation. 
 
Nevertheless, if the shares of the parties of the agreement or the members of the association of undertakings in the relative markets the agreement or decision do not exceed the aforementioned thresholds by more than 2% during two consecutive calendar years in the agreement or decision period, the agreement or decision specified will not drastically limit competition in the market.
 
However, it is crucial to state that; Failure to exceed these rates does not mean that the relevant agreements, actions or decisions will be exempted from the investigation. According to the implementation of the EU legislation, there is no investigation for agreements and decisions that meet the aforementioned conditions. Agreements and decisions meeting the conditions are included in the "safe harbour". According to the Turkish legislation, in Article 6 of the notification; It has been remarked that " it may not be made a subject to investigation" and that the discretion lies with the Competition Authority. Again, during the investigation of whether or not to open an investigation, the Competition Authority, which decides to open an investigation in case the market shares cannot be spotted exactly, has the authority to terminate the investigation if it understands that the thresholds mentioned in Article 5 have not been exceeded during the investigation process. Finally, in Article 7 of the notification, regulations regarding the calculation procedure of the market share have been made.
 
IV. Implementation in Terms of Time
Although the Notification was put into force on 16/03/2021, which is the publication date, according to the temporary article 1; It will also be applied in terms of ongoing preliminary researches and investigations as of the enforcement date.