The Regulation of the European Parliament and of the Council on Foreign Subsidies Distorting the Internal Market is published

The Regulation of the European Parliament and of the Council on Foreign Subsidies Distorting the Internal Market (Regulation), which aims to restore fair competition between all companies operating in the internal market, was approved by the Council on 28 November 2022 and may have significant impacts on certain Turkish public and private companies contemplating investment in the EU. The Regulation introduces new powers for the EU Commission to investigate financial contributions granted to companies that: (i) are of strategic interest to the EU; and (ii) manage critical infrastructure, including energy, transport, water, health, communications, media, data processing or storage, aerospace, defense, electoral or financial infrastructure and sensitive facilities, as well as land and real estate which is critical for the use of such infrastructure by a public authority in non-EU countries. Accordingly, non-EU companies entering into an M&A transaction in an EU country: (i) that involves an EU target having an EU-wide turnover of at least EUR500m; and (ii) where at least one of the merging undertakings, the acquired undertaking or the joint venture were granted with aggregate financial contributions from third countries that exceed EUR50m in the three financial years prior to notification should be notified to the EU Commission. In addition to the M&A deals, the Regulation also imposes new notification requirements on companies in certain public procurement processes.

Turkish companies that benefit from incentives granted by the Turkish government and contemplating new investments in an EU country will need to monitor implementation of the Regulation and how the complementary legislation and guidance will further shape the regime. We would also recommend these potential investors to set up robust information collection, processing and reporting governance in order to be able to provide the necessary information required under the Regulation, and factor in any time and incremental costs required for this additional reporting while forming transaction timelines and budgets.

Exclusionary practices by dominant players in light of recent case law in the digital sector? 

Read the full publication, "Exclusionary practices by dominant players in light of recent case law in the digital sector?"


Reconciliation: An expeditious alternative to competition investigations?

Read the full publication, "Reconciliation: An expeditious alternative to competition investigations?"

An increase in the Lower Limits of the Administrative Fines under Law on the Protection of Personal Data

With Communique No. 2023/1 issued by the Competition Authority, the lower limit of the administrative fine pursuant to Article 16 of the Act No. 4054 on the Protection of Competition (Competition Law) has been determined as TL 105,688 to be valid until 31 December 2023 by the Competition Authority.

As per Article 16 of the Competition Law, in those cases where;

  1. False or misleading information or document is provided in exemption and negative clearance applications and in authorization applications for mergers and acquisitions,
  2. Mergers and acquisitions that are subject to authorization are realized without the authorization of the Board,
  3. In implementation of request for information and on-site inspection, incomplete, false or misleading information or document is provided, or information or document is not provided within the determined duration or at all,
  4. on-site inspection is hindered or complicated,

The Competition Board shall impose on real and legal persons having the nature of an undertaking and on associations of undertakings or members of such associations, an administrative fine by one in thousand of annual gross revenues of undertakings and associations of undertakings or members of such associations which generate by the end of the financial year preceding the decision, or which generate by the end of the financial year closest to the date of the decision if it would not be possible to calculate it and which would be determined by the Board for those mentioned in sub-paragraphs (a), (b) and (c), and by five in thousand of their gross revenues to be calculated in the same manner for those mentioned in sub-paragraph (d).

Competition Board has expanded the definition of Technology Undertakings in its recent decisions

A new concept of technology undertakings has been introduced with the amendment made in the Communiqué on Mergers and Acquisitions subject to Competition Board's Approval (2010/4) entered into force on May 2022. Accordingly, turnover thresholds shall not be applicable for acquisitions, where a technology undertaking defined as the undertakings operating in the fields of or assets relating to digital platforms, software and gaming software, financial technologies, biotechnology, pharmacology, agricultural chemicals and health technologies is involved in a merger and acquisition transaction, as the acquired undertaking.

In its recent decisions, the Board has taken into account the following criteria while determining a technology undertaking (a) quality of the service provided; (ii) field of operation; and (iii) sector. In one of its decisions, it has defined an undertaking, having a digital platform with a limited number of users of 230 as a technology undertaking. The recent decisions lead to the conclusion that the Board makes a broad interpretation in terms of technology undertakings which will capture a larger number of undertakings in terms of obtaining Board's approval for a mergers and acquisitions transaction.


Global Head of Corporate, M&A and Securities
Partner, Pekin Bayar Mizrahi
Counsel, Pekin Bayar Mizrahi

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