The second fine in the year 2018 regarding resale price maintenance was given to Sony Eurasia Pazarlama A.Ş. for the violation Article 4 of the Act No. 4054 by maintaining the resale price of the dealers in online sales. It is necessary to see the reasoned decision for ensuring if the infringement was limited only to internet sales. However, if accepted as it is stated in the announcement of Turkish Competition Authority, this would be the first fine given for the maintenance of resale price in online sales. As you may recall, on 24 July 2018, the European Commission had fined over 111 million euros, in four separate decisions, consumer electronics manufacturers Asus, Denon & Marantz, Philips and Pioneer for imposing fixed or minimum resale prices on their online retailers. Despite the emphasis on the online sales, however it could be said that the violation was due to the restrictions on resale price maintenance. Therefore, it is possible to conclude that practices aimed at completely restrain online sales of dealers have not been found. In fact, restrictions of online sales have been recently examined in the BSH decision (dated 22 August 2017 and numbered 17-27/454-195) and Jotun Boya decision (dated 15 February 2018 and numbered 18-05/74-40). In both cases, a warning letter was sent to the undertakings indicating that practices that prevent dealers from selling over the internet shall be avoided.
This decision of Turkish Competition Board (Board) has once again demonstrated that interference on the resale price by relatively large undertakings will not be tolerated. To date, the Board has adopted a rigorous approach towards resale price maintenance. The first decision of the Board on resale price maintenance was the IGTOD decision (dated 24 November 1999 and numbered 99-53/575-365). Since then, the Board carried out a total of 17 investigations, including the Henkel decision which was announced approximately two months ago. In four of those investigations no fines were imposed. However, in the remaining cases various fines were imposed. The highest fine ever imposed is the Warner Bross decision (dated 24 March 2005 and numbered 05-18/224-66) with 1% rate.
In the computer games and consumer electronics decision (dated 7 November 2016 and numbered 16-37/628-279), which was one of the most important decisions in 2016, Vestel and Philips were fined for the resale price maintenance in the market of consumer electronics. Two different undertakings were fined in one single investigation for the resale price maintenance. As you may recall, approximately two months ago, the Board imposed administrative fines of 6.944.931,02 Turkish liras on Türk Henkel for the violation of Article 4 of the Act No. 4054 by maintaining the resale prices of its products, with the decision dated 19 September 2018 and numbered 18-33/556-274. The amount was 2.346.618,62 Turkish liras in the Sony Eurasia Pazarlama A.Ş decision. It is understood from the referral to Article 5/3-a of the Regulation of Fines in the announcement made by the Authority that the violation had lasted between 1 and 5 years. In addition, with the referral to Article 7/1 of the Regulation of Fines, it could be said that the basic fine has been reduced due to presence of mitigating elements.
As it is seen, resale price maintenance has been the subject of four decisions in the last two years. From now on, we will be waiting the result of the investigation concerning Turkcell İletişim Hizmetleri A.Ş, whose hearing will be held on 3 January 2019 as announced. As you may recall, the Board’s decision (dated 6 June 2011 and numbered 11-34/742-230) was given after the investigation conducted in connection with the allegations that Turkcell violated Article 4 and 6 of Act No. 4054 through resale price maintenance and exclusivity practices towards its distributors and dealers. Afterwards, this decision was partially quashed by the 13th Chamber of the Council of State (dated 16 October 2017 and numbered 2011/4560 E., 2017/2573 K.) based on the claims of resale price maintenance. In the light of this decision, an investigation was reinitiated by the Board with the decision dated 31 May 2018.