THE THRESHOLDS FOR NOTIFYING THE COMPETITION BOARD OF A COMPANY’S MERGER OR ACQUISITION TRANSACTION IN TURKISH COMPETITION LAW HAVE BEEN AMENDED

Share on whatsapp
Share on linkedin
Share on email

As may be recognized, within the “Communiqué Amending the Communiqué No. 2022/2 concerning Mergers and Acquisitions Requiring The Approval of the Turkish Competition Board” (“Communiqué”), which has been published in the Official Gazette dated 04.03.2022 and numbered 31768, the turnover thresholds, which are used as a basis regarding notifications to the Turkish Competition Board (“Board”), while carrying out merger and acquisition transactions have been increased and such thresholds initiated to be applied as of the date of 04.05.2022.

Turnover Thresholds That Haven’t Been Amended For 10 Years Was Updated

Pursuant to the Communiqué, two conditions must be provided in order to occur the obligation to notify the Board. In order to provide such conditions; the turnovers of the transaction parties must exceed the thresholds which was defined in line with the Article 7 of the Communiqué No. 2010/4 and the process must constitute a permanent change in control. By the amendments made regarding Article 7 of the Communiqué, in order for a merger or acquisition transaction to be subject to the permission of the Board;

  • The total Turkish turnover of the transaction parties must exceed seven hundred and fifty million Turkish Lira and the at least two of the transaction parties’ Turkish turnover must reach turnover thresholds exceeding two hundred and fifty million Turkish Lira separately, or
  • In acquisition transactions, the asset or activity subject to the transfer; in merger transactions, at least one of the transaction parties’ Turkish turnovers must exceed two hundred and fifty million Turkish Lira and the world turnover of at least one of the other transaction parties must reach turnover thresholds exceeding three billion Turkish Lira.

Exceptional Regulation on Technology Enterprises

The concept of “technology enterprise” was regulated within the Communiqué. Pursuant to the Communiqué, this concept refers to “enterprises which are operating in the areas concerning digital platforms, software and game software, financial technologies, biotechnology, pharmacology, agrochemicals, and health technologies or assets related to them.”  Acquisition of a company with a low turnover by a company with high turnover, which occurs within the scope of technology enterprises, is mostly defined as a lethal acquisition and it could be put into the process without being subject to the notification rules as a result of ignoring the potential/possible competition. Within the framework of the regulations made by the Communiqué, the turnover threshold will not be sought concerning the transactions regarding the acquisition of technology enterprises operating in the Turkish geographical market or carrying out R&D activities or providing services to users in Turkey.

Other Amendments

Notifications to be made to the Board within the scope of Mergers and Acquisitions can be made via the e-State system now. Certain amendments were made in the Notification Form, which was prepared in the annex of the Communiqué and required for notification. The form has been reregulated to be converted to digital format.

Conclusion

Within the amendment, it is foreseen that the Board’s workload will decrease and therefore more resources can be allocated within the scope of competition breach. In addition, the fact that Technology Enterprises are subject to an exceptional regulation indicates that a more qualified examination will be made in terms of concentration control of digital markets.

 

Buse Mercan, Attorney at Law

Share on facebook
Share on twitter
Share on linkedin
error: Content is protected !!