The Competition Authority published its annual report ('Report') for 2022. In the Report, the activities of the Competition Authority for the year 2022 are presented with numbers. One of the most interesting figures in the Report is the increase in the number of on-site inspection assignments. According to the Report, the Competition Authority experts were assigned 831 times for on-site inspections in 2022. This number was 653 in 2021, in other words, approximately 27% more on-site inspections were conducted in 2022 compared to 2021. In 2020, when we felt the effects of COVID-19 most severely, there were 502 on-site inspection assignments. Changes in the number of on-site inspections by year are presented in the table below.
Number of on-site inspection assignments
We also understand from the Report that the Competition Authority still does not consider the progress made regarding on-site inspections to be sufficient. Indeed, under the heading "Assessment of Institutional Capability and Capacity", the Report lists "increasing the capacity of on-site examination equipment" as one of the "areas open for improvement". This shows that we will face even more on-site inspections in the coming years.
In addition to this, the Report reminds us of the Authority's Strategic Plan for the 2019-2023 period published in 2019 and the objective of 'activating methods of obtaining evidence, particularly on-site inspections'. In alignment with the Competition Authority published the Guidelines on the Examination of Digital Data in On-Site Inspections in 2020 and started to examine more digital data, especially WhatsApp messages, more systematically in on-site inspections.
In the meantime, the Constitutional Court has recently issued a highly debated decision1. According to the Constitutional Court's recent decision, conducting on-site inspections without a prior court order does not provide sufficient guarantees in terms of residential immunity and therefore constitutes a violation of rights. While this decision currently has consequences for the applicant only, the Constitutional Court has notified the Turkish Parliament to resolve the structural problem. We will see in the coming days whether a regulatory change will be made on this issue or whether a different structural change will be decided. However, in the current situation, all we know is that the Constitutional Court's decision in question does not prevent the Competition Authority from conducting on-site examinations.
While the Competition Authority continues to conduct more intensive and comprehensive on-site inspections, it is known from numerous decisions published on the website of the Competition Authority that administrative fines at the rate of five per thousand of the undertakings' gross revenues of the previous year were imposed due to the fact that the on-site inspections were hindered or complicated (Article 16/1/d of the Law No. 4054). The only reason for this is that undertakings were not prepared well for on-site inspections and officials/employees of the undertaking made simple mistakes. For example, pursuant to the decision2 published on 2 October 2023, during the on-site inspection at Çilek Gayrimenkul Abdurrahman Altunbay, it was stated that 'while the inspection of the mobile phone belonging to the real estate consultant (.....) was in progress, at 12:16, (.....) and (.....) had to leave the undertaking on the grounds that the car driven by (.....) hit a pedestrian and there was a life-threatening emergency' and thus the on-site inspection was interrupted. However, the time of the accident and its consequences were examined by the experts by requesting the accident report, it was decided that 'while the traffic accident in question took place on 09.03.2023 at 09:01 and the accident report was kept at 10:00, there was no situation requiring urgent departure from the undertaking by interrupting the investigation in terms of (.....) and (.....), who were informed about the accident at 12:16, approximately 3 hours later'. As a result of the incident in question, it was decided to impose an administrative fine of 105,688.00 TL (lower limit of fine) on the undertaking.
Evidently, the Competition Authority continues to conduct more and more on-site inspections. When undertakings are not prepared for these on-site inspections, they make mistakes and face administrative fines. You never know when the Competition Authority may knock on your door, but it is always useful to be prepared for on-site inspections.
Footnotes
1. Constitution Court's decision dated 23.03.2023 which was published on 20.06.2023
https://www.resmigazete.gov.tr/eskiler/2023/06/20230620-5.pdf
2. Competition Board's decision dated 16.03.2023 and numbered 23-14/243-79
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