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Title: LOOKING BACK AND LOOKING AHEAD Organisation of Competition Authorities Turkeys Experience


1
LOOKING BACK AND LOOKING AHEADOrganisation of
Competition AuthoritiesTurkeys Experience
  • Yasar TEKDEMIR
  • (A. Director of International Relations,
    Competition Expert)
  • Turkish Competition Authority
  • 19.11.2008/PARIS

EUROPEAN COMPETITION DAYShaping A
Euro-Mediterranean Competition Policy
2
Outline
  • Overview of Turkish Competition Law and Policy
  • Competition Policy and Regional Integration
  • Convergence Among MEDA-partners in Competition
    Policy Area
  • Legal Framework,
  • Credible Enforcement,
  • Institutional Capacity and Principles,
  • Competition Culture,
  • International Cooperation
  • Evaluation and Suggestion

3
I-)Overview of Turkeys Competition Policy
  • Legislative Framework
  • Primary Legislation Act on Protection of
    Competition No 4054 (Turkish Competition
    Law-TCL) took into force on 13th of December 1994
  • Article 167 of Constitution The State will take
    all measures to deal with cartels and monopolies
  • 1/95 Customs Union Decision with the EU Turkey
    will introduce a competition law
  • Secondary Legislation A number of secondary
    legislation in the form of Communiqué (block
    exemption), guidelines and notices considering
    the relevant legislation in the EU.

4
I-)Overview of Turkeys Competition Policy
  • Institutional Framework
  • Turkish Competition Authority (TCA) was
    established and began to operate as an
    independent agency on 5th of November 1997.
  • Competition Board Decision-making Body (7
    members nominated by different agencies),
  • Presidency (President, Deputy Chairman, Vice
    Presidents),
  • Service Units (Professional Units and Supporting
    Units),
  • Expert Staff The key human resource in the
    enforcement process

5
I-)Overview of Turkeys Competition Policy
  • Enforcement Experience
  • The TCA has had an 11-year experience in the
    enforcement of competition law in Turkey.
  • the TCA conducted a number of cartel and abuse of
    dominant position investigations as well as
    merger control in cement, ceramic, fertilizer,
    cigarette, telecommunication, different food
    markets, transportation, media, tv broadcasting
    etc.
  • Competition Advocacy
  • Raising awareness of competition by consumers
    (the most important ally of competition agencies)
    and business community,
  • Raising awareness of competition by other
    Governmental Agencies (Sectoral Regulatory
    Agencies, Line Ministries etc.)

6
I-)Overview of Turkeys Competition Policy
  • International Relations including EU Affairs
  • Multilateral Relations (OECD, ICN, UNCTAD, WTO)
  • Regional Relations (EU, FTAs, MEDA etc),
  • EU has a major impact on Turkeys competition law
    and policy due to membership process of Turkey
    (Ankara Agreement, Additional Protocol, 1/95
    Customs Union Decision)
  • Turkeys competition law and policy is found as
    satisfactory by the European Commission in terms
    of legislation, institutional capacity and
    credible enforcement
  • Bilateral Relations (MoUs Korea, Romania,
    Bulgaria, Portugal)

7
I-)Overview of Turkeys Competition Policy
  • Perspective on MEDA (not a substitute for EU
    Membership but a Complementary as in the case of
    recent EU-ex MEDA partners),

8
II-) Competition Policy And Regional Integration
  • Competition law and policy is an important corner
    stone of a regional integration as in the case of
    the European Union
  • A framework to dismantle anti-competitive
    practices (actions by private and public firms
    and actions by Governmental Agencies) which could
    substitute for Government-erected barriers
    (tariffs and non-tariff barriers)
  • A framework to contribute to social welfare
    within the region by
  • endorsing the development of competition culture
    by 1) consumers and business community and 2)
    governmental agencies,
  • forcing/endorsing the firms (private and
    state-owned) to be competitive and innovative,
  • by endorsing all policies that support proper
    functioning of free market at competitive
    conditions.

9
III-) Convergence Among MEDA-partners Competition
Policy Area
  • Convergence needed if competition policy is
    attached an effective role in regional
    integration among partners.
  • Convergence requires the existence of certain
    elements for competition law and policy within
    the jurisdictions.
  • Legal Framework,
  • Credible Enforcement
  • Institutional Capacity and Principles
  • Competition Culture,
  • International Cooperation.

10
1-) Legal Framework2-) Credible Enforcement
  • Legal Framework
  • Substantive prohibitions (anti-cartel
    enforcement, abuse of dominant position and
    merger control),
  • Exemption/Rule of Reason,
  • Remedies,
  • Sanctions,
  • Right to Defense and Access to File
  • Leniency and Settlement,
  • Deadlines governed by Law,
  • Appeal Mechanism,
  • Credible Enforcement
  • Taking timely decisions,
  • Implementing effective fine policy together with
    a proper leniency,
  • Measuring effectiveness and Monitoring Compliance,

11
3-) Institutional Capacity and Principles1-
Institutional Setting
  • A) Independence
  • Independent decision-making body,
  • To be provided and protected by Law
  • To have financial and administrative autonomy,
  • B) Financial Resources
  • To de granted considering the functions attached,
  • To be sufficient for proper enforcement and
    advocacy,
  • To be sufficient for the CA to keep its
    independence,

12
  • C) Effective Organizational Structure
  • To be designed considering the sui-generis
    circumstances of the country,
  • To be designed considering the attached functions
    (decision-making, strategic planning, cartel
    prosecution and other investigations,
    evidence-collection (request for info,
    dawn-raids, FIT capacity), legal matters
    (interpretation, analysis, and appeal stage),
    reporting, economic analysis, monitoring,
    international relations, relations with other
    governmental agencies, competition advocacy,
    public relations, press relations, IT, human
    resources and administrative and financial
    affairs),
  • Dynamic and Effective organizational structure
    free from bureaucracy,
  • Periodic and Systematic monitoring the
    effectiveness and efficiency of the agency
    (internal monitoring and external monitoring)

13
  • D) Human Resources
  • High Qualified Expert Staff 111 expert staff
    work at the TCA
  • Choosing high qualified graduates by a proper
    examination system,
  • Provision of in-house training on different
    aspects of competition law and economics and
    other relevant fields,
  • A strict period of working as assistant expert
    accompanied by Senior Experts,
  • Sending abroad (mainly UK and US, and recently
    Netherland, France, Germany etc) the expert staff
    to follow a master degree on law and/or economics
    of competition,
  • Sufficient level of salary to keep the expert
    staff highly motivated and available at the
    agency,
  • Sufficient level of supporting Staff

14
3-) Institutional Capacity and Principles2-
Principles
  • General Principles
  • Respect for Property Rights,
  • Respect for Market Economy,
  • Respect for Competition,
  • Rule of Law,
  • Principles of Competition Agencies
  • Timeliness,
  • Efficiency and Effectiveness,
  • Legality and Transparency,
  • Respect for Right to Defense,
  • Predictability,
  • Accountability,
  • Integrity/Credibility,
  • Non-Discrimination between Domestic and Foreign,
  • Non-Discrimination between Private and
    State-owned,
  • Attaching Special Importance on the issue of
    Regulatory Capture,
  • Planning and Priority Settings

15
4-) Competition Culture (Competition Advocacy
Role)
  • Competition Culture By Consumers and Business
    Community
  • Seminars, Panels and Conferences,
  • Booklets,
  • Continuous information via internet page,
  • Communicating in a timely manner the positive
    impact of decisions/practices on Consumers and
    Business Community,
  • Continuous and systematic consultation with
    regional governing bodies, consumer associations
    and association of undertakings.
  • Competition Culture By Governmental Agencies
  • Regulatory Impact Assessment and Competition
    Assessment Endorsing less anti competitive
    regulatory option which serves the same
    objective/goal,
  • Sending Opinions,
  • Organizing Seminars,
  • Having continuous and systematic consultation
    with main Governmental Agencies,

16
5-) International Cooperation
  • Soft Cooperation
  • Cooperation which enables the CAs to share
    information on theoretical works and practical
    experience.
  • Takes place in UNCTAD, OECD, ICN, WTO (!).
  • Takes place via RTAs (multilateral, regional and
    bilateral),
  • MEDA,
  • Agency To Agency Agreements.
  • Needed to deal with effectively trans-border
    violations, which also threaten regional
    integration.
  • Two Forms
  • Soft Cooperation
  • Hard Cooperation

17
5-) International Cooperation
  • Hard Cooperation
  • Means the cooperation which enables CAs to
    cooperate in enforcement of actual cases.
  • Requires CAs to exchange for data and information
    about an actual case, to conduct dawn-raids etc.
  • Takes place rarely in compare to soft cooperation
    (OECD, RTAs, ATAs etc).
  • Leads certain concerns for the requested CAs.
  • Hard Cooperation
  • Cooperation in enforcement takes place when
    enforcing competition law in an actual cases.
  • Cooperation in Procedural matters, helps
    competition agencies to communicate its official
    documents to the companies located in the
    cooperating jurisdiction.

18
5-) International Cooperation -Turkeys
Experience-
  • Soft Cooperation
  • Membership in International Organisations such as
    OECD, ICN, UNCTAD and WTO,
  • Regional Trade Agreements
  • The Customs Union Decision 1/95 of the
    Association Council of Turkey and EU (MEDA is
    another platform which arise from Turkeys
    relations with the EU)
  • FTAS
  • Bilateral Cooperation Agreements (MoUs with
    Korea, Romania, Bulgaria, Portugal)

19
5-) International Cooperation -Turkeys
Experience-
  • Hard Cooperation
  • Turkey had two cases in which it requested for
    hard cooperation.
  • The first one is Seized (Piece) Coal Market Case,
    which was partly finalized by the Competition
    Board. The second case is glass cartel conducted
    against one domestic firm and one foreign firm
    established in Greece.
  • No need to go into details of these cases,
    however sharing their implications in terms of
    cooperation is important.

20
5-) International Cooperation -Turkeys
Experience-
  • Evaluation
  • In terms of cooperation in enforcement (in coal
    market case) No step could be taken within the
    framework of EFTA Free Trade Agreement in
    Switzerland and 1/95 in EU (actually Austria).
  • In terms of cooperation in procedural aspect (in
    both coal market case and glass case) No step
    could be taken in communicating officially the
    documents to the companies located abroad,
  • As the practice of the TCA is an administrative
    one and no proper international legal framework
    was designed for the communication of such
    administrative documents in contrary to judicial
    issues.

21
V-) Evaluation And Suggestions
  • 1-) Institutional Capacity and Principles
  • Institutional Capacity
  • To be independent in order to fulfill its
    function properly,
  • To have a sufficient financial resource to
    finance its expenditures as well as to secure its
    independence,
  • To have an institutional setting designed
    considering the needs and characteristics of its
    country,
  • The Institutional setting to be based on a
    dynamic and effective structure that is free from
    bureaucracy,
  • To have sufficient and well-trained professional
    staff as well as not more than necessary
    supporting staff,
  • To periodically measure and check its
    effectiveness,
  • To keep professional staff updated by periodic
    training.

22
V-) Evaluation And Suggestions
  • 1-) Institutional Capacity and Principles
  • Principles
  • The Competition Authority should observe certain
    principles in its enforcement as well as its
    relations with all third parties,
  • These principles should be announced in advance
    if possible,
  • Every action/decision/practice of the Competition
    Authority should refer explicitly or implicitly
    on these principles

23
V-) Evaluation And Suggestions
  • 2-) Competition Culture (Competition Advocacy)
  • Activities to raise awareness of competition by
    consumers and business community (Seminars,
    Panels, Conferences, Booklets, Communicating the
    impact of decision/practices),
  • Activities to raise awareness of competition by
    other Governmental Agencies (Introduction of
    Regulatory Impact Analysis and Competition
    Assessment provide a framework in which
    competition agencies can strengthen its advocacy
    role)

24
V-) Evaluation And Suggestions
  • 3-) International Cooperation
  • Soft Cooperation MEDA partners should first of
    all attach importance on soft cooperation among
    them as well soft cooperation on other
    international platforms,
  • Hard Cooperation
  • With the increasing globalisation and
    liberalisation of international trade, national
    competition authorities will face the
    difficulties that the TCA faced in its cases more
    frequently,
  • MEDA partners should find ways/methods/solutions
    to improve hard cooperation in enforcement as
    well as procedural aspects.

25
Thank You for Your Attention
Contact Info Yasar TEKDEMIR Adress Rekabet
Kurumu (Competition Authority), Bilkent Plaza B3
Blok, Bilkent/ANKARA Tel 90 312 291
4310 E-mail ytekdemir_at_rekabet.gov.tr www.rekabet
.gov.tr
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