Anti-competitive Behaviour Of Banks

02 Jun Anti-competitive Behaviour Of Banks

T.C. Council of state 13.Circle, 2015/2624 E., 2015/4608 K. Date 16.12.2015

Interest rates and fees for banking services (12 Banks ‘ co-determined / competition-limiting actions occurred under a compromise on deposit credit card and Credit Services-contravention of the law on protection of competition/the Competition Board’s decision to impose administrative fines at an appreciable 1% of annual gross income is in accordance with the law)
Actions limiting competition (the implementation and follow-up of Undertakings operating in the banking sector, which is the common denominator of the settlement, by co-determination of price strategies, is carried out by means of a series of Communication Information Sharing and agreement between the parties – the administrative fine imposed by the Competition Board is in accordance with the law)
Contravention of the law on protection of competition (12 where the Bank sets together Interest Rates and fees for various banking services/where actions limiting competition occur within the context of a compromise on deposit credit and Credit Card Services – the Competition Board’s decision to impose administrative fines of an appreciable 1% of annual gross income is not unlawful)
Anti-competitive behavior of banks (there is no lawlessness in the Competition Board’s decision to impose administrative fines at an appreciable 1% of annual gross income-12 The Bank sets together Interest Rates and fees for various banking services/the actions that limit competition occurred within the scope of a settlement that deals with deposit credit card and Credit Services)
Agreement of the banks on credit card services (the common denominator of the agreement is the implementation and follow-up of the price strategies together determined by a series of Communication Information Sharing and agreement between the parties is carried out – the administrative fine imposed by the Competition Board is in accordance with the law/contravention of the law on the protection of competition)
Credit interest / deposit interest (12 where the Bank jointly determines the interest rates and fees applied to its services/the actions that limit competition occur within the framework of a compromise on deposit credit card and Credit Services – the common denominator of the agreement is the implementation and follow-up of a joint determination of price strategies, through a series of Communication Information Sharing and)
4054 / m. 4, 16/3

SUMMARY : enterprises in the banking sector, the interest rates and fees for various banking services that is applied to determine where they are in competition with actions of a restrictive nature, of the actions in question deposits (in terms of public banks, public deposits, including loan and credit card services within the scope of a compromise on the subject of reconciliation had occurred and the common denominator of price created to determine strategies for the determination of the elements of the compromise, the implementation and follow-up of these documents is carried out through a series of Communications, Information Sharing and reconciliation between the parties, documents are obtained in on-site investigations, information from the contents of these documents are shared between the banks parties to the investigation within the scope of an agreement, in some documents the top managers of the banks competing in the market meet, as a result of this meeting and negotiations, it is understood from the documents in the dossier that information sharing has been made which reveals the existence of an agreement.

In this respect, the plaintiff’s stated non-competitive conduct is subject to Article 4 of the Act. since it is understood that it has violated the article, there is no illegality in the decision of the board which is the subject of the lawsuit concerning the administration fine of TL 148.231.490 to the plaintiff, which was formed at the end of the 2011 financial year and which was determined by the board at the rate of 1% of the annual gross income.

Summary Of The Request: Ankara 2. The Administrative Court’s date of 25.12.2014 and E:2014/232, K:2014/1581 numbered decision; The decision of the board of directors was given a penalty of between 0.3% and 1.5%, but the reason for this different punishment was not explained in the decision, the failure to define the relevant Product Sunday required the cancellation of the transaction, the decision of the board was made based on incomplete examination, the Bank settlement could not be proved, a single ongoing, public-owned banks are not considered to be the only economic integrity and are asked to be corrupted.

Summary of the defence: it is argued that the refusal of the appeal request and the decision of the Administrative Court, which is in accordance with procedure and law, should be upheld.

Council of State Examination Judge opinion: it is thought that the court decision should be upheld with the rejection of the appeal request.

ON BEHALF OF THE TURKISH NATION

The decision was made by the Thirteenth Office of the Council of state, after hearing the statements of the examination Judge and reviewing the documents in the file, the law No. 2577 on the procedure of Administrative Proceedings 17. Article 2. in accordance with the paragraph, the claimant company’s request for a hearing was not seen at the site and the request for the execution to be stopped because the file had been completed was also discussed without a decision being made on the necessity of the work.:

DECISION : the case in Turkey of the banks that operate deposit, loan and credit card services interest rate, fees and commissions on the determination of an agreement and/or concerted action of the law on protection of competition No. 4054 by reference 4. as a result of the investigation into whether they acted contrary to Article 4 of the law on the claimant company. article 148.231.490-TL for the application of administrative fine by betting on violation of the Competition Board decision dated 08.03.2013 and numbered 13-13/198-100 was filed with the request for cancellation; Administrative Court; when the investigation report and its annexes and all the information, documents and evidence available in the file are evaluated together; under investigation the banks deposits, loans, credit card services, interest rates and various fees on the determination of market competition, preventing, disrupting, or birth or the effect of the restriction agreements and concerted action which they were found in are likely to have this effect, the share trade secret information with each other, market-oriented decisions in negotiation for compliance and acted in accordance with the agreement of wills getting together, considering that the implementation of the issues agreed within the scope of this agreement is fixed by economic analysis and graphics, the claimant bank, which is the party to the said agreement and the concerted actions, is obliged to act 4 of Law No. 4054. since it was concluded that the provisions of this article were violated, the decision of the board subject to the lawsuit regarding the application of administrative fines of TL 148.231.490-a total of 1% on the annual gross income generated at the end of the 2011 financial year was not deemed to be unlawful, and it was claimed that all public banks (ZIRAAT, Vakıfbank and HALKBANK) should be considered as a, in accordance with the provisions of the Turkish Commercial Code and banking law, they are independent legal entities in the nature of joint stock companies, they can operate in all banking services, they compete with other public banks as well as private banks in their banking activities, there is no sharing of data affecting commercial strategies with other public capital banks, all three public banks have their own governing bodies, , there is no legal obligation in the governing bodies of the banks to have a manager in another public authority, and in the actual case there is no public official in the executive positions, there is no executive in the banks simultaneously, there is no executive in the decision-making processes of all three public capital banks, no authority or person outside the bank, decisions by the governing bodies of the banks is subject to the approval of legal or de facto of any public authority where such authority to make strategic decisions or decisions by the governing bodies of the bank on the appropriateness of the question to check out is not independent of the banks operational and strategic decisions of all kinds, taken without the decisive influence of the public authority, in the absence of a regular data flow between banks, to banks in terms of public authorities, considering the fact that ZIRAAT Bank, Vakıfbank and HALK Bank are independent from each other and therefore do not interfere with the strategic decisions of the related banks, the fact that they use their powers arising from owning the whole or the majority of the capital and their powers to appoint board members is limited only to shareholders; the state’s influence on the banks with public capital is, as it was concluded that they are legal entities that have the purpose of restraint or have the obligation to avoid actions which may or may have the effect of this effect, it was decided to dismiss the case on the grounds that the plaintiff’s claims to the contrary were not respected, and this decision was appealed by the plaintiff.

4 Of The Law No. 4054 On The Protection Of Competition. the article says, “the competition in the market for specific goods or services directly or indirectly blocking, jamming, or the birth or the purposes of this restriction, or effect, which may lead to agreements between undertakings, decisions of associations of undertakings and concerted practices of this kind and the actions unlawful and is prohibited.

This is the case, include in particular:

Determination of the purchase or sale price of goods or services, the elements such as cost, profit and all kinds of purchase or sale conditions that constitute the price,
The division of goods or services markets and the sharing or control of all market resources or elements,
Control of the quantity of supply or demand of goods or services or their determination outside the market,
Forcing, restricting the activities of competing undertakings, or forcing the undertakings operating in the market out of the market by boycott or other actions, or preventing new entrants from entering the market,
Application of different conditions to persons in equal position for equal rights, obligations and acts, excluding exclusive dealership,
The nature of the agreement or in violation of the commercial principles, the mandatory purchase of other goods or services any goods or services or vehicle in the event of the attempt of the buyers, the demand for other goods or services conditional on presentation by the buyer of goods or services or supply the goods or the supply of services again, it is argued that the terms of,
Where the existence of an agreement cannot be proven, price changes in the market, or the balance of supply and demand, or regions of activity of undertakings are similar to those in markets where competition is hindered, disrupted or restricted, constitute a presumption that undertakings are engaged in concerted action.

On the basis of economic and rational facts, each party may be relieved of responsibility by proving that it has not taken concerted action.”the rule is in place.

On the other hand, 16 of the act entitled “administrative fines”. Article 3. paragraphs 4, 6 and 7 of the Act. it is stated in its articles that those who engage in prohibited conduct shall be fined administrative fines of up to ten percent of the annual gross income generated at the end of the fiscal year preceding the final decision or, if this cannot be calculated, at the end of the fiscal year closest to the date of the final decision and determined by the board.

From the study of the case; the highest ratio is determined by banks through interest rates, discount interest rates, any bank, not all banks the same interest rate that uses the outcome of the review of the claims made on preliminary prepared by the board where it was decided that research will be done, preliminary research report 4 of the Act No. 4054. the report prepared on the completion of the investigation, the written and oral defense held by the banks on 25.02.2013, is based on the decision of the Board of directors and the decision of the Law No. 4054 on the undertakings in question, and the decisions made at the oral defense meeting dated 4. it is understood that it has been concluded that it has breached its clause and that an administrative fine has been imposed on the undertakings involved.

Act No. 4054 4. in particular, it is prohibited to do so by means of agreements, concerted actions and decisions and actions of associations of enterprises, which have the purpose of preventing, disrupting or restricting competition directly or indirectly in a particular market of goods and services, or which may have or may have the effect of this effect. In this respect, Act No. 4054, 16. in order to impose an administrative fine on a competition violation based on Article 4 of the law. a non-competitive agreement or concerted action specified in the article must be taken and the existence of such unlawful acts must be revealed.

4 Of The Aforementioned Act. the reason for the article is that the agreement is used for the purpose of the article in the sense of any compromise or conciliation that the parties feel connected to, even if it does not comply with the validity conditions of the Civil Law, and that the agreement has no importance whether written or oral.

The general rationale of the law No. 4054 stated that in a market economy where competition is provided, price and profit indicators will be determined away from interventions; that competition is a process which is a tool for the functioning of the market economy; that it is not possible for the market economy to operate in a healthy way if there are no conditions to constitute competition; that

Where the purpose of violating competition can be determined, it is of minimal importance to determine the nature of acts and behaviors that are alleged to be contrary to competition. As a matter of fact, the provisions of the Law No. 4054 and the reasons related to it are stated in summary that acts and behaviors aimed at violating competition are prohibited. It is clear that there is a suspicion that there is a competing purpose in sharing information such as price and cost for the future, which is not in doubt when it is important for competition, with another Competitive Enterprise. The fact that the sharing of competition-sensitive information is repeated within a specific process also supports this suspicion and demonstrates the existence of an agreement. It is also clear that the non-repetition of information sharing will not stop competition-sensitive information sharing from being a non-competition agreement, and that this situation will be evaluated by the relevant authorities according to the nature of each concrete event.

Enterprises in the banking sector, the interest rates and fees for various banking services that is applied to determine where they are in competition with actions of a restrictive nature, of the actions in question deposits (in terms of public banks, public deposits, including loan and credit card services within the scope of a compromise on the subject of reconciliation had occurred and the common denominator of price created to determine strategies for the determination of the elements of the compromise, implementation and monitoring of communication between the parties conducted a series of, it is understood from the documents in the file that information sharing and reconciliation are carried out through on-site investigations, that information sensitive to competition is shared between the banks parties to the investigation from the contents of these documents within the scope of an agreement, that in some documents the top managers of the banks competing in the market meet at breakfasts, and that

The undertaking of the plaintiff; obtained in the investigation, Document-2 and document the economic analysis performed on this gentleman’s agreement is a party to the document and document clearly the presence of 3-4 based on these documents from the analysis, deposit interest rate, attended by an agreement on the document 14, the document 16, document-Document, 20-21 state-owned banks that carries the purpose of competition between disruptive they make a deal, it is understood that the plaintiff also included in the agreement.

In this respect, the plaintiff’s stated non-competitive conduct is subject to Article 4 of the Act. since it is understood that it has violated the article, there is no illegality in the decision of the board which is the subject of the lawsuit concerning the administration fine of TL 148.231.490 to the plaintiff, which was formed at the end of the 2011 financial year and which was determined by the board at the rate of 1% of the annual gross income.

Conclusion: the case is subject to appeal in the way of rejection on the grounds outlined above Ankara 2. The Administrative Court’s date of 25.12.2014 and E:2014/232, K:2014/1581 Resolution No. 49 of the Code of Administrative Proceedings No. 2577. Article 1. since there are no reasons for the annulment mentioned in the paragraph, the appeal request is not seen in place and the court decision is upheld on the above-mentioned grounds.; to send the file to the aforementioned court, unused 45.60.- In the event of a request for the fee to stop the execution of TL, a unanimous decision was made on 16.12.2015, in order to correct the decision within 15 (fifteen) days following the notification date of this decision.