What does interim measure decision say?
The decision is open to criticism for several reasons starting from the scope of authority regarding privacy concerns.
What appears in the decision is that the Board did not ground the need for an interim measure on any sufficient evidence. Instead, the Board expressed several concerns about the situation arising from certain assumptions on relevant markets, abuse of dominant position, and possible harm.
We see that the Board begins its analysis by uttering a brand new relevant market for "consumer communication services" where WhatsApp is defined as a "consumer communication tool." Then we see that the Board tosses in the strong market power of Facebook in the markets for (i) consumer communication services, (ii) social network services, and (iii) online advertising services. However, no dominant position analysis appears as was necessary, nor is there any analysis on the abusive conduct. Especially in the market for online advertising services, competitors like Google bring how Facebook can surely hold such a strong position to cause severe and irreparable damage.
- Users share more private and confidential data on WhatsApp compared to Facebook,
- WhatsApp data is tied to other products and data of Facebook companies,
- Facebook uses its market power in the consumer communications services market to exclude its competitors in the internet advertising area,
- Excessive data collection and use of data for other services result in the exploitation of users.
From an economic perspective, it is interesting and hard to examine the markets where people do not pay with money for their use. The assumption of paying with data (instead of monetary price) may be quite misleading because of the data's non-exhaustive feature. Paying with data is quite different from paying with monetary terms. People can use their personal data multiple times, which does not reduce their ability to provide the same data to another serviceprovider. Therefore, it is ambiguous to identify what kind of behavior constitutes exploitative abuse in markets where people do not pay with money for the services they use. Similarly, it is challenging to create a theory of harm, as users' wealth in terms of their available data is not affected. However, consumer disutility due to lower privacy and significant behavioral biases may still help construct a theory of harm2.
The procedural aspect of the decision
The procedural aspect of the decision is also worth mentioning. The Board has issued this interim measure decision under Article 9/4 of the Competition Act, which reads as:
"Where the occurrence of serious and irreparable damages is likely until the final decision is taken, the Board may take interim measures to maintain the situation before the infringement, without exceeding the scope of the final decision."
According to Article 9/4, the Board should prove the likeliness of the occurrence of severe and irreparable damages. Where the investigation launched concerns the violation of Article 6, this requires (i) first, determination of the relevant market based on economic analysis, (ii) second, determination of the dominant position in the previously determined relevant market, and (iii) adequately detailed analysis on the abusive conduct. Although interim measure decisions are not based on in-depth analysis as in final decisions, Article 9/4 is applicable where the possibility of the occurrence of severe and irreparable damages is likely. Here, the burden of proof remains with the Board to convincingly show sufficient evidence concerning the likelihood3. Although we see this high-level proof requirement in the European Union legislation4 and practice5, Turkish case law does not provide much of an example.
An interim measure is a tool used in situations where there are strong indications of a violation, and the probability of possible damage is very high. For this reason, competition authorities should employ interim measures where the case seems to be clear-cut. For instance, if there is a prima facie finding of infringement according to Article 8 of Regulation 1/2003, refusal to deal cases are relatively convenient to satisfy the requirements of severe and irreparable damage. In this sense, the European Commission takes an abstinent approach towards interim measures6.
Why is it inevitable to criticize some aspects of the decision?
Within this context, we can say that procedural fairness emerges as one of the most significant issues in competition law enforcement. In this respect, competition authorities should be transparent about the proceedings and provide investigated parties with detailed information on the allegations of anti-competitive conduct7: The facts, the supporting evidence, the legal and economic theories, etc. The same applies to interim measure decisions, preliminary examination decisions, and so on. From this point, the ill-defined reasoning behind the Board's decision brings some questions as "why consent regime falls into the scope of the Authority's powers instead of the Data Protection Authority?" or "how the free-will of users would result in exploitation of consumers?" or "what is the economic basis for the market for consumer communication services" and the market power of Facebook in the market for online advertising services when there remains Google?" etc.
What is next?
It is worth mentioning that before the amendments to the Competition Act, Article 55 provided undertakings with a judicial remedy against interim measures before the Council of State. However, the new formula of Article 55 regulates the judicial review for administrative sanctions. Thus, it does not point to a specific judicial authority before which undertakings take their claims against interim measures.
As we mentioned above, the interim decision will likely be discussed among the competition law professionals. We believe that several aspects of the decision are quite open to criticism. Above all, the conflict of authority between the data protection and competition authorities is again on the top of the list. Unless competition authorities demonstrate substantial harm under the fundamental of the competition law, all these investigations essentially stemmed from the violation of the data privacy law should solely fall into the authority of the data privacy authorities. Otherwise, a new era where consumers cannot enjoy the big techs' services as they used to is not far away.
1. Decision dated 11.01.2021 and numbered 21-02/25-10 of the Turkish Competition Board.
2. Haucap, J. (2019). Data Protection and Antitrust: New Types of Abuse Cases? An Economist's View in Light of the German Facebook Decision. Competition Policy International, 1(February), 1-9. See also. Budzinski, O., Grusevaja, M., & Noskova, V. (2020). The Economics of the German Investigation of Facebook's Data Collection. SSRN Electronic Journal, 26(139). https://doi.org/10.2139/ssrn.3593236.
3. Pitesa, T. (2020). Interim measures: A new enforcement pathway!?, Kluwer Competition Law Blow. http://competitionlawblog.kluwercompetitionlaw.com/2020/04/09/interim-measures-a-new-enforcement-pathway/#_ftnref3 (Last accessed: 19.02.2021).
4. Article 8 of Council Regulation (EC) No 1/2003 of 16 December 2002 on the implementation of the rules on competition laid down in Articles 81 and 82 of the Treaty. As per Article 8, two cumulative requirements have to be satisfied for the imposition of interim measures: (i) an urgency stemming from the risk of serious and irreparable damage to competition, (ii) prima facie finding of infringement.
5. Judgment of the Court of First Instance of 12 July 1991, Automobiles Peugeot SA and Peugeot SA v Commission of the European Communities, Case T-23/90, EU:T:1991:45, par. 63.
6. Pitesa, T. (2020). Interim measures: A new enforcement pathway!?, Kluwer Competition Law Blog. http://competitionlawblog.kluwercompetitionlaw.com/2020/04/09/interim-measures-a-new-enforcement-pathway/#_ftnref3 (Last accessed: 19.02.2021).
7. ICC Commission on Competition (2017). Discussion Paper: Effective procedural safeguards in competition law enforcement proceedings, p. 2. https://iccwbo.org/content/uploads/sites/3/2017/07/ICC-Due-Process-Best-Practices-2017.pdf (Last accessed: 19.02.2021)
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