The Turkish Competition Authority ("Authority") has introduced the Communiqué No. 2017/2 Amending Communiqué 2010/4 on Mergers and Acquisitions Requiring the Approval of the Competition Board ("Communiqué No. 2010/4") ("Communiqué No. 2017/2"). The Communiqué No. 2017/2 has been published in the Official Gazette on 24 February 2017, and entered into force on the same day. The amendments introduced to Communiqué No. 2010/4 are as follows:
(I) Article 1 of the Communiqué No. 2017/2 abolished Article 7(2) of the Communiqué No. 2010/4, which stated that "The thresholds set out in the first clause of this article are re-determined by the Board biannually." With the abolishment of the relevant clause, the Turkish Competition Board ("Board") is no longer rested with the duty to re-establish turnover thresholds for concentrations every two years. Therefore, there is no specific timeline for the review of the relevant turnover thresholds set forth by Article 7(1) of Communiqué No. 2010/4.
(II) Article 2 of Communiqué No. 2017/2 modified Article 8(5) of Communiqué No. 2010/4, which previously read as follows: "two or more transactions carried out between the same persons or parties within a period of two years shall be considered as a single transaction for the calculation of turnovers listed in Article 7 of this Communiqué." The amended version of Article 8(5) reads as follows: "two or more transactions carried out between the same persons or parties or within the same relevant product market by the same undertaking concerned within a period of three years shall be considered as a single transaction for the calculation of turnovers listed in Article 7 of this Communiqué." According to the foregoing amendment, the Board would now evaluate the transactions realized by the same undertaking concerned in the same relevant product market within three years as a single transaction, as well as two transactions carried out between the same persons or parties within a three-year period.
(III) Article 3 of Communiqué No. 2017/2 has introduced a new paragraph to be included in Article 10 of Communiqué No. 2010/4, which reads as follows: "If the control is acquired from various sellers by way of a series of transactions in terms of securities within the stock exchange, the concentration could be disclosed through notification to the Turkish Competition Board after the realization of the transaction, provided that the following conditions are satisfied: (a) The Turkish Competition Board should be notified of the concentration without delay, (b) the voting rights attached to the acquired securities are not exercised or exercised solely to maintain the full value of the investments based on a derogation granted by the Turkish Competition Board. For the sake of completeness, the Turkish Competition Board may impose conditions and obligations in terms of such derogation in order to ensure conditions of effective competition."
At any rate, although there was no similar specific statutory rule in Turkey on this matter until the promulgation of the Communiqué No. 2017/2, the case law of the Board had previously shed light on this matter. Indeed, in its Camargo/Cimpor decision (12-24/665-187, 03.05.2012), where the Board reviewed the acquisition of Cimpor-Cimentos de Portugal, SGPS, S.A. ("Cimpor") by Camargo Corrêa S.A. ("Camargo") by way of a public tender offer, the Board had already referred to Article 7(2) of ECMR. In the case in question, Camargo had filed this transaction following its public tender offer, but before acquiring the respective shares. As apparent from the reasoned decision, Camargo indicated that the exact date for the transfer of shares which would enable the acquisition of control over Cimpor could not be determined at the time of the filing. Accordingly, the Board resolved that even if Camargo acquired the majority of the shares (providing control) before the Board's approval decision, provided that it did not exercise these voting rights, this would not constitute a violation under the provisions of the Law No. 4054 on the Protection of Competition. To that end, even before the promulgation of the Communiqué No. 2017/2, based on the Board's Camargo/Cimpor precedent, the Board had already recognized that the parties would close a public bid on a listed company before the Board's approval, subject to the conditions that (i) the Board is notified of the transaction "without any delay," and (ii) the acquirer does not exercise the rights attached to the shares that it acquired and which confer control over the target, pending the Board's approval.
As the Camargo/Cimpor decision is rather unique in this field and the Board's relevant case law has not been solidified further, a legislation-based clarification (providing a measure of legal certainty) on these types of concentrations, as introduced by the Communiqué No. 2017/2, is most welcomed.
This article was first published in Legal Insights Quarterly by ELIG, Attorneys-at-Law in June 2017. A link to the full Legal Insight Quarterly may be found here.
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