September 18, 2021

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A Milestone For The Implementation Of The ‘Ne Bis In Idem’ Theory In Turkish Opposition Regulation: Substantial State Courtroom Upholds The Competitiveness Board’s Non-Fining Conclusion

I. Introduction

In April 2016, the Turkish Opposition Board (the “Board“) released an investigation from Mey ki San. ve Tic. A.. (“Mey ki“), a subsidiary of Diageo plc. The investigation aimed to take a look at the validity of the allegations concerning Mey ki`s abuse of dominance in the Turkish markets for vodka and gin.

Soon after eighteen months of investigation, the Board located that (i) Mey ki retains the dominant posture in vodka and gin marketplaces, (ii) Mey ki has violated Post 6 of Law No. 4054 on Defense of Levels of competition (“Legislation No.4054“) in the vodka and gin marketplaces, and (iii) as Mey ki has now gained an administrative monetary fine for the repercussions of the same technique in the raki (conventional Turkish spirit) market place,1 there is no room for yet another administrative monetary fine (October 25, 2017, 17-34/537-228) (“Non-Fining Final decision“).

The situation handlers alleged that Mey ki appreciated dominance in the Turkish markets for vodka and gin, and had engaged in exclusionary practices from competitors via rebate schemes, money payment supports and visible arrangements at gross sales points.

All these alleged techniques of Mey ki had presently been examined and fined by the Board in its earlier 2017 Raki Decision. The alleged techniques belonged to the specific exact period of time in both conclusions and the only major distinction amongst the two investigations was the merchandise worried.

All through the investigation method, Mey ki shown that the situation lacked both equally procedural and substantial grounds, and emphasized the “ne bis in idem” basic principle in unique. It utilized financial arguments to bolster the oral and penned defenses. Especially, Mey ki quite strongly advocated that the investigation was crippled for doublejeopardy as (i) the Turkish Competitors Authority (“Authority“) carried out a next investigation on the identical allegations which pertained to the exact interval of time and (ii) it developed the chance of a copy good. Sooner or later, the Board discovered a violation via abuse of dominance but, yet, it recognized Mey ki’s “ne bis in idem” protection and concluded that Mey ki need to be spared from an additional administrative financial fantastic for the same alleged practices that had taken put in specifically the exact same time period.

So, the Board acknowledged after all over again that “ne bis in idem” basic principle should be taken into account in competition regulation conditions. The selection was established to turn into a landmark precedent with regards to the interpretation and application of the “ne bis in idem” theory less than the Turkish competition law regime.

At this position, on the other hand, two rivals lively in the identical applicable product marketplaces for vodka and gin initiated two separate appeals versus the Board’s Non-Fining Conclusion in the initial occasion administrative courts. Equally lawsuits had been dismissed as the courts observed that the nonfining aspect of the choice was lawful.2 Yet, adhering to these judgments, this time these competitors submitted their appeals to the regional administrative courts.

The 8th Administrative Chamber of the Ankara Regional Administrative Court (“Regional Administrative Courtroom“) recognized the appeals of the plaintiffs, overturned the judgments of the initially instance courts and annulled the Board’s Non-Fining Conclusion.3 The Regional Administrative Courtroom noted that the vodka and gin marketplaces are distinctive from the raki marketplace and then went on to state that a violation that happened in the vodka and gin markets need to also be issue to a sanction. In this regard, the Non-Fining Decision was uncovered to be illegal “contemplating that it is possible to work out the administrative monetary great to be imposed, as a share of the annual gross revenue, established in the prescribed charge scale.”4

Upon these choices of the Regional Administrative Court docket, this time, it was the Authority that initiated an appeal method just before the Substantial Point out Court docket, and whereunder Mey ki also submitted extensive declaration petitions as the intervening occasion on the appellant Authority`s facet.

Eventually, the Large Condition Court docket, which is the optimum plenary judicial physique for administrative conditions, accepted the arguments set forth by Mey ki and the Authority on the requirement to apply the basic principle of ne bis in idem.5 The 13th Chamber of the Substantial State Court extremely lately reversed the Regional Administrative Court’s conclusions, and appropriately, the nonfining component of the Board’s Non-Fining Final decision regained its validity. All in all, the administrative process right before the courts from the Board`s Non-Fining Selection was accurately concluded in favor of the implementation of the principle of ne bis in idem in levels of competition regulation.

These choices of the Significant State Court had quick seen influence on the case regulation of the Board. In actuality, just a pair of months next the announcement of the selections of the Higher Point out Court docket, the Board rendered yet another non-fining selection6 by making use of the ne bis in idem basic principle, wherever there was all over again a danger of duplication of penalty thanks to a prior fining selection7 rendered about the identical carry out of Mey ki carried out in the same pertinent product or service market (i.e. raki) in the same time period of time.

The Ne Bis In Idem Principle

Rule of law calls for that the electric power of the judiciary, exactly where the sovereignty of the condition manifests, will have to be ruled by sure fundamental legal concepts. Ne bis in idem is a person of the typical lawful ideas fundamental this requirement.

The theory of ne bis in idem is universally acknowledged and discussed in several legislative and academic resources. The Charter of Basic Legal rights of the European Union sets out the correct not to be tried using or punished 2 times in felony proceedings for the identical prison offence below Write-up 50. Similarly, Posting 4(1) of Protocol No. 7 to the European Convention on Human Rights, which entered into drive in Turkey on August 1, 1954, states that “(n)o just one shall be liable to be attempted or punished once more in legal proceedings under the jurisdiction of the very same Point out for an offence for which he has presently been eventually acquitted or convicted in accordance with the legislation and penal technique of that Point out.”

The ne bis in idem basic principle is also inextricably joined with other rules that govern the judiciary in a condition of regulation. It is an unavoidable outcome of the suitable to a truthful demo, which is certain below Article 36 of the Turkish Structure and Write-up 6 of the European Convention on Human Legal rights. This theory, by definition, supplies that a number of lawsuits can not be initiated, many judgments can’t be rendered, or multiple jeopardies are not able to be imposed towards the same person owing to the identical act. As a outcome, the ne bis in idem basic principle serves the purpose of (i) removing the uncertainty that a individual who was issue to a penal sanction may well deal with in expecting a new judiciary course of action for the very same act, for the relaxation of their existence and (ii) developing lawful stability and lawful trustworthiness.

The theory of ne bis in idem is made up of two major aspects. In purchase for it to be applied, (i) the applicable get together committing the act and (ii) the act in query, will have to be the exact same. The aspect regarding the sameness of the man or woman, refers to their currently being identified as having the similar formal id information and physical qualities as the human being who was the subject of a judicial method that has been finalized.8

III. Ne Bis In Idem Basic principle In Turkish Competitors Legislation

While the internationally acknowledged ne bis in idem basic principle initially originated in legal regulation, it is also pertinent for Turkish competitiveness legislation.9 The theory applies to administrative sanctions that have the properties of legal penalties,10 and consequently, to the administrative financial fines imposed by the Board, due to the fact they qualify as these administrative sanctions.

Pursuant to Posting 15/1 of Misdemeanor Law, “If a lot more than a single misdemeanor is dedicated via an act, and the imposition of an administrative monetary fantastic is the only sanction presented for these misdemeanors, then the heaviest administrative monetary fantastic will be imposed.” According to the pertinent provision, in phrases of administrative sanctions, the Misdemeanor Legislation has acknowledged the ne bis in idem theory. Consequently, in situation the legislation sets forth two different monetary fines for a one act, only the heavier administrative monetary wonderful would be imposed, thereby staying away from a duplication of penalty as for every ne bis in idem theory.

Also, Article 4(1)a of Regulation on Fines to Apply in Cases of Agreements, Concerted Tactics and Determination Limiting Competitiveness and Abuse of Dominance (“Regulation on Fines”) also echoes the ne bis in idem basic principle as follows: “The foundation great shall be calculated in the framework of Posting 5 of this Regulation. In circumstance much more than just one unbiased conduct in phrases of the industry, character, and chronological period prohibited below Article content 4 and 6 of the Act is detected, the foundation wonderful shall be calculated separately for every single carry out.” The Regulation on Fines, as a result, recognizes that independent base fines really should only be used in respect of unbiased carry out, and impartial perform really should only be considered to exist wherever 3 cumulative situations are content: particularly that the examined behaviors choose area in distinct marketplaces, have unique natures (i.e., they represent different kinds of violations) and just take position in impartial chronological durations. In this way, the Regulation on Fines implicitly respects the basic principle of ne bis in idem by precluding the application of numerous base fines, in conditions where by functions are materially equivalent.

Moreover, quite a few Board precedents11 also display that (i) ne bis in idem principle is regarded within the scope of Turkish level of competition legislation, (ii) the Board actively avoids the issuance of duplicate sanctions, and (iii) the Board renders its selections pursuant to the ne bis in idem principle. However, the Board’s Non-Fining Choice casts a one of a kind but also really major and strong technique for the implementation of the theory of ne bis in idem, even in opposition to the problems that could occur owing to the susceptibility of the circumstance to misinterpretations for the reason that of the various related item marketplace definitions at hand, as had been the situation in the judgement of the Regional Administrative Courtroom.

IV. The Assessment of the Superior Point out Court

During the attractiveness approach versus the Regional Administrative Court’s selections, Mey ki argued that, by annulling the Board’s Non-Fining Decision that properly assessed the ne bis in idem principle, the Regional Administrative Courtroom experienced dismissed that the precise conditions that named for implementing the theory, misinterpreted the essence of ne bis in idem, and for that reason, rendered a final decision in breach of this essential legislation theory. Mey ki stated that the allegations in the 2017 Raki Decision and Non-Fining Determination experienced (i) worried the similar endeavor, and (ii) based mostly on the identical conduct by that endeavor, that took place in the exact same time period of time, i.e., 2014-2016. The Authority also emphasized these details in its very own attractiveness submissions.

Taking into account the arguments of Mey ki and the Authority in its evaluation, the Substantial Point out Courtroom has now clearly confirmed that the ne bis in idem basic principle should apply in this situation. The High Condition Court (i) made a decision that the annulment of the Board’s Non-Fining Determination that implements the theory of ne bis in idem, had been illegal and (ii) rightfully reversed the conclusions of the Regional Administrative Courtroom.

The Large Point out Court docket (i) referred to Short article 2 of the Regulation on Misdemeanors, which defines misdemeanor as a wrongdoing for which an administrative sanction is to be imposed by the legislation and (ii) indicated that the conduct, in other words and phrases, the misdemeanor that is prohibited under Post 6 of Legislation No. 4054 and fined as for every the Posting 16 of Regulation No. 4054 is “the abuse, by just one or a lot more undertakings, of their dominant position in a market place for products or solutions in just the whole or a portion of the nation, on their own or by agreements with other folks or via concerted techniques.”

Appropriately, the Large Point out Courtroom concluded that (i) in accordance with this legal definition, a person of the features of misdemeanor is the “market for items or products and services” where the behavior can take put and consequently (ii) in the function that the anti-competitive motion is fully commited in a lot more than just one merchandise industry and results in additional than a single impact, there will be as many violations as the range of marketplaces. Having said that, the Large State Court docket underlined that in get to resolve the dispute, it is vital to clarify how quite a few fines can be supplied, in the event that extra than 1 misdemeanor is fully commited with a single act. As a result, the High Point out Court docket reached the conclusion that committing far more than a person misdemeanor with a single act does not normally mean that additional than a person high-quality need to be imposed.

The Large State Courtroom stated that considering the fact that the violations committed by undertakings with the very same conduct within the scope of the execution of a solitary industrial coverage, irrespective of the marketplaces associated, are not unbiased in terms of “the industry, character and chronological interval” (emphasis included), they need to be evaluated as a solitary action and should really not be penalized more than the moment.

Appropriately, the Large Point out Courtroom pointed out that the conducts that were being uncovered to constitute a violation in the vodka and gin marketplaces (i) were the very same as the conducts that were being deemed to represent a violation in the 2017 Raki Determination and subjected to administrative fines, (ii) took location in the very same period of time and (iii) had been aspect of the total basic system of the enterprise. It consequently determined that (i) the Board`s Non-Fining Decision experienced been lawful and (ii) the Regional Administrative Court docket choices were devoid of legal accuracy.

V. Why This Situation Issues

Had they been allowed to stand, the Regional Administrative Court’s decisions to annul the Board’s Non-Fining Selection would have caused legally conflicting effects in conditions of analyzing the applicability of ne bis in idem theory in Turkish levels of competition law. There is no question that the decisions of the Regional Administrative Court have been evidently in breach of the frequently recognized lawful theory of ne bis in idem, which sets forth that a single act are not able to be sanctioned two times. As defined above, the Regional Administrative Court docket had concluded that a new administrative monetary wonderful ought to be issued, only primarily based on the point that the Authority done two different investigations masking different markets. As a result, these choices of the Regional Administrative Court docket would have experienced a essential and adverse affect on the way that ne bis in idem theory is assessed in Turkish opposition law.

By reversing the decisions of the Regional Administrative Courts, the Significant Condition Courtroom the moment once more ensured that ne bis in idem principle would be consistently applied in Turkish competitiveness regulation and emphasised that the Board ought to not render duplicate sanctions against the exact undertakings for the exact alleged behaviors taking location at the similar time time period. Therefore, the decision of the Board nevertheless sets a landmark precedent in terms of superior being familiar with the significance and the implementation of the “ne bis in idem” basic principle below the Turkish levels of competition regulation routine.

These new decisions of the Higher Condition Court also strengthened the Large Condition Court’s previously approaches, wherever the ne bis in idem theory was used to the administrative sanctions, e.g., disciplinary sanctions.12 Certainly, in advance of these new selections, the Substantial State Courtroom had said that “The world `ne bis in idem’ theory is a basic principle that really should also be used to disciplinary regulation.”13 With these new selections, the Superior Condition Court docket did not only adopt a dependable method for the implementation of the theory of ne bis in idem in scenarios about administrative sanctions, but also verified and paved the way for the implementation of this commonly accepted authorized basic principle in the level of competition law circumstances.

As a outcome, the Significant State Court’s new conclusions that uphold the Board’s Non-Fining Selection are particularly impressive as they open a new chapter for recognizing the requirement of considering the ne bis in idem basic principle in competition regulation cases. In fact, these new choices of the Significant Point out Court by now produced results on the situation regulation of the Board, as stated higher than.

(1st printed by Mondaq on March 15, 2021)