Article 4 of the Law No. 4054 on the Protection of Competition (the "Competition Law") prohibits anti-competitive agreements, concerted practices and decisions. That being said, the prohibition on restrictive agreements and practices does not apply to agreements that benefit from a block exemption and/or an individual exemption issued by the Board in scope of the exemption regime, as certain restrictive agreements may have significant benefit to consumers. Exemptions may be granted by the Board in the form of block exemptions (on which the Competition Authority issues communiqués) or as individual exemption. The exemption regime is regulated by the Article 5 of Law No. 4054.
Block exemptions are generally-applicable exemptions in a business line or industry or certain type of agreements (i.e. vertical agreements), which allow organizations in the industry to engage in some business activities that may be otherwise deemed as anti-competitive. Article 5 of Law No. 4054 lays the groundwork for the Authority to issue block exemption communiqués. The preambles of Article 5 stipulate that the ability to issue block exemption communiqués paves the way to legal certainty for the undertakings as well as the gaining of economic efficiencies derived from the agreements that fulfill the exemption conditions.
Individual exemptions (as also set out by the Article 5 of Law No. 4054) are specifically-applicable exemptions that cover a single agreement (or a model agreement) from the application of the Article 4 prohibition.
The parties to an agreement can engage in a self-assessment as to whether their agreement is covered by a block exemption. If the agreement is not covered by block exemption, they can assess whether the conditions of individual exemption are met. In 2020, the Competition Law was subject to essential amendments which passed through the Grand National Assembly of Turkey on 16 June 2020, and entered into force on 24 June 2020 ("Amendment Law") – on the day of its publication in Official Gazette No. 31165. The Amendment Law now aims to provide legal certainty as to the individual exemption regime, by clarifying that the "self-assessment" principle applies to agreements (as well as concerted practices and decisions of associations of undertakings) that may potentially restrict competition. The undertakings may consider carrying out self-assessments to conclude whether their vertical agreements may benefit from an individual exemption. That being said, the option to apply to the Board for individual exemption is still available.
The generally-applicable Block Exemption Communiqué No. 2002/2 on Vertical Agreements ("Communiqué No. 2002/2") regulates the conditions for granting block exemptions for vertical agreements. In addition to Communiqué No. 2002/2, there are also sector-specific block exemption regulations (such as the Block Exemption Communiqué No. 2017/3 on Vertical Agreements in the Motor Vehicle Sector) which set conditions for block exemption regime on the basis of sector-specific agreements. These are explained under the "Sector-specific Exemption" section. Agreements and decisions that fall under the scope of block exemption regime automatically benefit from the exemption and do not require a separate notification.
When conducting exemption assessments, companies and trade associations should take block exemption communiqués, guidelines and the Board's jurisprudence into consideration. If the agreement concerned does not meet the conditions set under any of these regulations or by the Board's precedents, then an individual exemption application might be necessary to gain legal certainty.
Individual exemption applications are not mandatory as the parties are allowed to engage in self-assessment, as noted above. Further explanation on the conditions for individual exemption regime can be found under the "Individual Exemption" section.
Please also see the "individual exemption/negative clearance application form" for further information.
