The Board has recently imposed a daily administrative monetary fine on the economic unity comprising Meta Platforms, Inc. (formerly Facebook Inc), Meta Platforms Ireland Limited (formerly Facebook Ireland Limited), and WhatsApp LLC (together referred to as “Meta's Economic Unity” or “Meta”) to be implemented each day starting from 12 December 2023. This action was taken as Meta failed to comply with obligations previously rendered due to its abuse of dominant position.

How Did Meta Violate the Competition Rules?

In its decision dated 20 October 2022 and numbered 22-48/706-299 (the “Final Decision”), the Board unanimously found that Meta holds a dominant position in the markets for personal social networking services, consumer communication services, and online display advertising1 . Additionally, it was unanimously decided that by amalgamating the data collected by the basic services of Facebook, Instagram, and WhatsApp, a restriction on competition was created, violating Article 6 of Law No. 4054 on Protection of Competition (“Law No. 4054”) by hindering the activities of its competitors operating in the personal social networking services and online display advertising markets and by establishing a barrier to entry therein.

In addition to the administrative monetary fine of TRY 346,717,193.40 (approx. EUR 10,535,314)2 imposed on Meta, the following obligations were imposed: (i) to submit the necessary measures to the TCA within one month at the latest from the notification of the reasoned decision, (ii) to implement the necessary measures within six months from the notification of the reasoned decision, and (iii) to submit annual reports to the TCA periodically for five years from the commencement of the implementation of the first compliance measure.

Non-Compliance of Meta with the Obligations

On 10 January 2024, the TCA published its announcement regarding Meta's non-compliance with the remedies imposed by the Final Decision. According to the announcement, Meta received the reasoned decision on 9 September 2023 and requested a time extension until 9 December 2023. Meta submitted its first round of compliance measures within the deadline and resubmitted a revised version to the TCA on 19 December 2023. The Board discussed the compliance measures in its meeting of 21 December 2023 and resolved as follows with its decision numbered 23-60/1162-417:

The expressions and explanations under the title “Confirming the Choice with the Commencement of the Compliance Remedy” are not adequate to fulfill the obligation imposing that “Meta should submit the necessary measures to the TCA within one month at the latest from the notification of the reasoned decision to terminate the said violation and to ensure the establishment of effective competition in the market” which is laid down in the Board's Final Decision.

Since the Board accepted Meta's time extension request for a one-month period to submit the necessary measures to the TCA until 9 December 2023, and considering that the deadline for Meta to submit its Final Compliance Remedy to the TCA expired on 11 December 2023 pursuant to the Final Decision, the Board imposed a daily administrative monetary fine of TRY 4,796,152.96 (approx. EUR 145,735) on Meta starting from 12 December 2023 until the Final Compliance Remedy is submitted to the TCA's records, pursuant to Articles 17(1)(a) and 17(2) of Law No. 4054.

Implementation of Article 17(1)(a) of Law No. 4054

Article 17 of Law No. 4054, which regulates the imposition of proportional administrative monetary fines, stipulates that the Board shall impose on undertakings and associations of undertakings an administrative fine for each day, amounting to five in ten thousand of annual gross revenues of the relevant undertakings generated by the end of the financial year preceding the decision. “Non-compliance with the obligations or commitments introduced in the Board's final decision or interim measure decision” is listed as one of those cases under Article 17(1)(a) – which serves as the basis for the daily administrative monetary fine imposed on Meta.

This is not the first instance where the Board imposed daily administrative monetary fines due to non-compliance with obligations or commitments introduced in the Board's decisions3 . In 2017, the Board initiated a phase II investigation regarding the merger notification of Luxottica Group S.p.A. (“Luxottica”) and Essilor International S.A. (“Essilor”). Both parties were active in the optical market, where the Board carried out evaluations in terms of horizontal effects and conglomerate effects. The Board conditionally approved the transaction subject to certain structural and behavioural commitments with its decision dated 1 October 2018 and numbered 18-36/585-286 (the “2018 Decision”). In 2021, the Board examined the practices of the merged entity, namely EssilorLuxottica S.A. (“EssilorLuxottica”), and concluded that (i) the agreements where optical lenses and optical machinery are offered together, as well as the merged entity's other practices, created a de facto exclusivity that was exclusionary, and (ii) therefore, violated Article 6 of Law No. 4054. In addition to the abuse of dominant position, the Board concluded that EssilorLuxottica violated the commitments rendered with the 2018 Decision. Consequently, due to the failure to comply with the commitments, the Board imposed a daily administrative monetary fine on EssilorLuxottica of TRY 492,191,132 (approx. EUR 14,955,671) for a period of 1096 days4 , with its decision dated 17 August 2023 and numbered 23- 39/749-259. This case is known as the longest fine ever due to non-compliance with commitments5 .

Although the implementation of Article 17(1)(a), resulting in a daily administrative monetary fine, is quite rare, it should be noted that the Board attaches great importance to compliance with obligations or measures regardless of whether the case is related to a merger notification or a full-fledged investigation. In situations of non-compliance, such as (i) submission of remedies after the deadline determined by the Board expired, (ii) submission of insufficient remedies that do not fulfill all the obligations, or (iii) no longer maintaining the implementation of obligations at later stages, undertakings would face the risk of significant daily administrative monetary fines. Therefore, it is crucial to comply with the Board's decisions in the best possible way, as the TCA monitors the undertakings until it ensures that effective competition is established and maintained.

Footnotes

1. The investigation was initiated to evaluate Facebook's proposed update, scheduled to take effect on 8 February 2021. This update sought permission to utilize the data of WhatsApp users in Türkiye within the framework of other Facebook services.

2. EUR equivalent of TRY amount is calculated at the following rate: EUR 1 = TRY 32.91.

3. Please also see the Google Android I decision dated 7 November 2019 and numbered 19-38/577-245, where the Board imposed a daily monetary fine on Google's economic unity since the compliance package did not fulfill the obligations rendered by the Board's investigation decision. Additionally, refer to the Google Android II decision dated 9 January 2020 and numbered 20- 03/30-13, where the Board imposed a daily monetary fine for a period of 60 days starting from the date of the Android I decision until Google submitted a compliance package that fulfilled the obligations. Also, see the Board's Isttelkom decision dated 13 February 2020 and numbered 20-10/120-70, and the TURSAB decision dated 15 April 2004 and numbered 04-26/284-62.

4. See “Competition Newsletter” published by the TCA on 2 November 2023. The newsletter is available at the following link: https://www.rekabet.gov.tr/Dosya/competition-newsletter_issue1_ tca.pdf

5.The TCA's announcement is available at the following link: https:// www.rekabet.gov.tr/tr/Guncel/essilorluxottica-s-a-hakkindayurutulen--aba76c1d6e45ee118ec600505685da39