Introduction
Excessive pricing under Turkish Competition Law is one of the most controversial forms of abuse of dominance. Competition law generally protects low prices, innovation, efficiency and consumer welfare. However, a dominant undertaking may sometimes use its market power not to exclude competitors, but to exploit customers directly by charging prices that are unreasonably high compared with the economic value of the product or service.
The main legal basis is Article 6 of Law No. 4054 on the Protection of Competition. Article 6 prohibits the abuse of a dominant position in a market for goods or services within all or part of Turkey. The provision lists examples of abuse, such as preventing market entry, complicating competitors’ activities, discrimination, tying and restricting production, marketing or technical development to the prejudice of consumers. Although the text of Article 6 does not expressly use the phrase “excessive pricing,” Turkish practice treats excessive pricing as a possible form of abuse because the list of abusive conduct is illustrative rather than exhaustive.
Excessive pricing is difficult because competition authorities are not price regulators. A high price may reflect innovation, scarcity, brand value, risk, investment, quality, inflation, exchange-rate movements or rising input costs. Intervention is exceptional and generally requires dominance, durable market power, lack of effective competitive pressure, significant barriers to entry and a price that cannot be reasonably explained by cost, risk, quality or economic value.
1. What Is Excessive Pricing?
Excessive pricing may be defined as charging a price that is unreasonably high in relation to the economic value of the product or service. Turkish commentary on the Competition Authority’s approach describes excessive pricing as an unreasonable difference between the economic value of a product and the actual price charged.
In simple terms, excessive pricing is not merely “expensive pricing.” A luxury product can be expensive without being excessive. A patented medicine can be costly because of research and development. A digital platform may charge high fees because it provides access to a valuable user base. A supplier may increase prices because of exchange-rate fluctuations or raw material costs.
The legal problem begins when a dominant undertaking charges prices that are significantly and persistently above a competitive level, and the market cannot correct the price through entry, switching, countervailing buyer power or regulation.
2. Excessive Pricing as Exploitative Abuse
Competition law abuses are often divided into exclusionary abuses and exploitative abuses. Exclusionary abuses harm competitors and market structure. Examples include predatory pricing, refusal to supply, margin squeeze and exclusive dealing. Exploitative abuses harm customers directly. Excessive pricing is the classic example of exploitative abuse.
In an excessive pricing case, the concern is not necessarily that competitors are excluded. The concern is that customers are directly exploited because the dominant undertaking can charge prices that would not be sustainable in a competitive market.
This makes excessive pricing politically and economically sensitive. Consumers may suffer immediate harm, especially where the product is essential. However, intervention may also create risks. If authorities punish high profits too easily, companies may lose incentives to invest, innovate or enter markets. Therefore, Turkish practice tends to treat excessive pricing as exceptional, especially where market forces or sectoral regulation can correct the problem.
3. Dominance Is the First Requirement
Excessive pricing under Article 6 requires dominance. A non-dominant undertaking may charge high prices, but customers can usually switch to competitors. If alternatives exist, market forces should discipline the price. Therefore, competition law intervention becomes relevant mainly where the undertaking has durable market power.
Dominance under Law No. 4054 means the ability to determine economic parameters such as price, supply, production and distribution independently from competitors and customers.
In excessive pricing cases, dominance analysis should be strict. The authority must examine market share, entry barriers, customer switching possibilities, buyer power, regulation, network effects, data advantages, brand power, legal monopoly rights, capacity constraints and availability of substitutes.
A high market share alone is not enough. The key question is whether the undertaking can profitably maintain prices above competitive levels without losing customers to rivals or attracting new entry.
4. Why Excessive Pricing Is Exceptional
Excessive pricing cases are exceptional because competition authorities are not designed to set “fair” prices in ordinary markets. Price regulation is usually the role of sectoral regulators or legislation, not competition authorities.
This concern is reflected in Turkish practice. Commentary on Turkish excessive pricing enforcement notes that the Competition Board is cautious about directly determining a competitive price level and generally refrains from acting as a price regulator.
There are strong reasons for this caution. First, determining the correct price is difficult. Second, high prices may attract entry and self-correct the market. Third, aggressive intervention may reduce investment incentives. Fourth, pricing may reflect risk, innovation, quality or brand value. Fifth, in inflationary economies, price increases may result from legitimate cost pressures.
Therefore, excessive pricing intervention is more likely where the market cannot self-correct. This may be the case where there is a legal monopoly, exclusive rights, very high entry barriers, essential products, lack of substitutes, low demand elasticity, or strong network effects.
5. Article 6 Does Not Expressly Mention Excessive Pricing
A notable feature of Turkish law is that Article 6 does not expressly refer to “unfair prices” or “excessive prices.” This differs from EU law, where Article 102(a) TFEU expressly refers to unfair purchase or selling prices. Turkish commentators note that Article 6 does not contain the same wording, but excessive pricing is still assessed under Article 6 because the list of abuses is illustrative.
This creates a higher need for careful legal reasoning. The authority must show not only that prices are high, but also that the conduct constitutes abuse of dominance within the meaning of Article 6.
In practice, this means excessive pricing analysis should focus on market power, economic value, cost-price relationship, comparison with other markets or competitors, lack of competitive constraints and consumer harm.
6. Cost-Price Analysis
One common method in excessive pricing cases is cost-price analysis. The authority may compare the price charged with the undertaking’s costs and profit margins. If the price is significantly above cost without objective justification, this may support an excessive pricing allegation.
However, cost analysis is difficult. Companies may have common costs, fixed costs, sunk investments, risk costs, research and development costs, marketing costs, platform costs, data infrastructure costs or long-term investment costs. In digital markets, marginal costs may be low, but fixed and development costs may be high. In pharmaceutical or technology markets, current production costs may not reflect innovation risk.
Therefore, cost-price comparison alone may be insufficient. A high margin can be a warning sign, but it should be assessed together with market structure, economic value, investment, risk and comparators.
7. Economic Value Test
Another important approach is the comparison between price and economic value. A price may be excessive if it has no reasonable relation to the economic value of the product or service.
Economic value may include quality, brand recognition, reliability, innovation, network effects, access to users, technical support, convenience, safety, speed, data, customer base or platform value. This is particularly important in digital platforms. A platform may charge corporate users not only for listing space, but for access to a large user base, search visibility, trust, reputation and network effects.
The challenge is that economic value is not always easy to measure. In the Sahibinden case, the Board considered excessive pricing in online platform services for vehicle and real estate sale/rental services, examining prices, price increases, market shares, competitor prices and cost-price differences.
Digital platform cases show why excessive pricing analysis must be more sophisticated than a simple cost-plus test.
8. Comparator Analysis
Competition authorities may also compare the dominant undertaking’s prices with prices charged by competitors, prices in other geographic markets, prices in previous periods, or prices for similar services. Comparator analysis can be useful, but it must be applied carefully.
A competitor’s lower price does not automatically mean the dominant undertaking’s price is excessive. Competitors may offer lower quality, have different business models, serve different customer segments or operate at a loss. Similarly, prices in another country may reflect different taxes, labor costs, regulation, demand, exchange rates or market structure.
In platform markets, comparator analysis becomes even more complicated. Two platforms may both provide online listing services but differ significantly in user traffic, brand recognition, network effects, conversion rates, data tools and consumer trust. The value delivered to business users may therefore differ.
A reliable comparator must be economically meaningful. Otherwise, the analysis may become speculative.
9. Market Self-Correction
A central question is whether the market can self-correct. If high prices attract new entry or expansion by competitors, intervention may be unnecessary. If customers can switch easily, the dominant undertaking may not be able to sustain excessive prices.
Turkish commentary on the annulment of the Sahibinden decision notes that the Board’s recent excessive pricing approach has generally required markets where entry is not possible or probable and where the market mechanism cannot regulate the price itself.
This is a crucial point. Excessive pricing intervention is more defensible where high prices are not expected to attract effective competition. Examples may include legal monopolies, exclusive rights, natural monopolies, essential facilities, high switching costs, network effects or markets with severe entry barriers.
10. Regulated Markets
Excessive pricing allegations in regulated markets require special caution. If a sectoral regulator already controls prices, competition law intervention may duplicate or conflict with regulation. Turkish commentary notes that the Board has historically been reluctant to analyze excessive pricing in markets subject to pricing regulation.
This does not mean that regulated markets are completely immune from competition law. A dominant undertaking in a regulated sector may still abuse dominance through exclusionary conduct or unfair practices. However, where the specific price is already regulated, competition authorities may be more cautious about substituting their own price assessment for that of the sectoral regulator.
A company in a regulated market should therefore assess both sectoral price rules and competition law obligations.
11. The Belko Decision
The Belko decision is often described as one of the important early Turkish excessive pricing cases. Belko was connected to the sale of imported coal and had exclusive rights granted by public authority. Turkish commentary states that the Board considered factors such as exclusive import and sale rights, impossibility of new entry, lack of regulation preventing pricing exploitation and low demand elasticity.
The significance of Belko is that it shows the type of market structure where excessive pricing intervention becomes more plausible: monopoly-like power, lack of entry, lack of effective regulation and consumer dependency.
This is different from a normal competitive market where high prices may attract entry or customer switching.
12. The Sahibinden Case
The Sahibinden case is one of the most important Turkish excessive pricing matters because it involved a digital platform. In 2018, the Competition Board found that Sahibinden.com held a dominant position in online platform services for vehicle and real estate sale/rental listings and abused that position through excessive pricing toward corporate customers. The Board imposed an administrative fine of over TRY 10 million.
The decision was important because it applied excessive pricing theory to a multi-sided platform market. The Board considered price increases, price-cost differences, competitor prices and entry barriers. It also considered network effects and the value of the Sahibinden brand.
However, the decision was later annulled by the Ankara 6th Administrative Court. The court emphasized the need for clear, precise and evidence-based proof in excessive pricing cases and found that some findings were closer to observation or hypothesis than concrete proof.
The Sahibinden litigation shows that excessive pricing findings require a high evidentiary standard. High prices, strong market position and consumer complaints may not be enough unless the analysis is supported by robust economic evidence.
13. Digital Platforms and Excessive Pricing
Digital platforms create special challenges for excessive pricing analysis. Platforms may provide access to users, data, search visibility, reputation systems, trust mechanisms, payment tools and advertising infrastructure. Their costs may not be directly proportional to each transaction. Their value may derive from network effects rather than traditional production costs.
A platform may charge high fees because it gives sellers access to a large consumer base. But if the platform becomes unavoidable and can raise fees without competitive constraint, excessive pricing concerns may arise.
Key questions include:
Does the platform have durable market power?
Can sellers multi-home effectively?
Can users switch to rival platforms?
Are there strong network effects?
Are entry barriers high?
Are fees unrelated to service value or cost increases?
Do business users depend economically on the platform?
Are price increases persistent and unexplained?
Does the platform’s conduct harm consumer welfare or business users?
Digital platform excessive pricing cases must carefully measure economic value, not merely accounting cost.
14. Excessive Pricing and Price Gouging
Excessive pricing under competition law should be distinguished from price gouging or “exorbitant price increases” under consumer, retail or emergency legislation. Competition law excessive pricing usually requires dominance and abuse under Article 6. Price gouging rules may apply more broadly, especially during crises, shortages or emergency conditions.
During the COVID-19 period, Turkey introduced and used separate mechanisms addressing unfair price increases and stockpiling. The Unfair Price Assessment Board was established under amendments to retail trade legislation to address excessive price increases and stockpiling by manufacturers, suppliers and retail businesses.
This distinction matters. A company may face Ministry of Trade scrutiny for unjustified price hikes even if it is not dominant. By contrast, a competition law excessive pricing case under Article 6 normally requires dominance.
15. Inflation and Cost Increases
In Turkey, inflation, exchange-rate movements, import costs, energy prices, labor costs and supply-chain disruptions can significantly affect pricing. These factors must be considered carefully in excessive pricing analysis.
A price increase may look dramatic in nominal terms but be justified by input costs, currency depreciation, taxes, logistics costs or supplier prices. Therefore, companies should document the reasons for price increases.
Dominant undertakings should maintain records showing:
Input cost changes.
Exchange-rate impact.
Energy and logistics costs.
Labor cost increases.
Tax and regulatory cost changes.
Supply shortage impact.
Investment and maintenance costs.
Quality improvements.
Risk and financing costs.
Such documentation can be critical in defending against excessive pricing allegations.
16. Evidence in Excessive Pricing Cases
Evidence is central. The Competition Authority or courts may examine price history, cost structure, profit margins, competitor prices, international comparators, customer complaints, internal pricing documents, market studies, entry barriers, buyer power, demand elasticity and consumer behavior.
The Sahibinden annulment highlights the importance of concrete and scientific evidence. The Administrative Court reportedly found that some findings did not exceed observation or hypothesis and emphasized the need for data-based proof.
For complainants, this means an excessive pricing complaint should not rely only on the claim that prices are “too high.” It should show dominance, lack of alternatives, durable entry barriers, unexplained price-cost gap, unreasonable comparison with economic value and harm to consumers or business users.
For defendants, it means pricing decisions should be supported by contemporaneous evidence and economic analysis.
17. Possible Defenses
A dominant undertaking accused of excessive pricing may raise several defenses.
First, it may challenge market definition and dominance. If customers have substitutes or competitors can expand, Article 6 may not apply.
Second, it may show that prices are justified by costs. This may include input prices, exchange rates, investments, research and development, platform costs, risk, capacity constraints and quality improvements.
Third, it may show that the price reflects economic value. A service with high conversion rates, strong network effects or superior quality may justify higher prices than competitors.
Fourth, it may show that the market can self-correct. High prices may attract entry, expansion or customer switching.
Fifth, it may show that the sector is regulated or subject to another price-control mechanism.
Sixth, it may argue that intervention would harm investment incentives.
The strongest defense combines legal argument with economic evidence.
18. Compliance Program for Dominant Undertakings
Dominant or potentially dominant undertakings should implement an excessive pricing compliance program. This does not mean they cannot increase prices. It means price increases should be economically justified, documented and reviewed.
A practical compliance program should include:
Regular dominance assessment.
Market share and entry barrier monitoring.
Cost tracking and documentation.
Review of major price increases.
Internal pricing approval procedures.
Economic analysis for high-margin products.
Documentation of investment and quality improvements.
Comparator analysis where appropriate.
Separate review for essential products or platform fees.
Legal review before sudden crisis-period price increases.
Training for pricing, finance, sales and management teams.
The purpose is not to freeze prices but to ensure that pricing decisions can be explained if challenged.
19. Compliance in Digital Platforms
Digital platforms should pay special attention to fee increases imposed on business users. Platform fees, listing fees, commissions, advertising fees, subscription fees and premium visibility charges may all attract scrutiny if the platform is dominant.
Before increasing fees, a platform should ask:
Do business users depend heavily on the platform?
Can they realistically switch or multi-home?
Are competitors able to discipline our price?
Are fee increases linked to cost increases or service improvements?
Do users receive measurable additional value?
Are fees transparent?
Are similar users treated consistently?
Do internal documents describe customers as locked in?
Are there complaints suggesting lack of alternatives?
A platform should avoid internal language suggesting that fees can be raised simply because users have no choice. Such language can become damaging evidence.
20. Remedies in Excessive Pricing Cases
Remedies are one of the hardest issues. If an authority finds excessive pricing, what should the price be? Competition authorities generally do not want to become permanent price regulators.
Turkish commentary notes that the Board may avoid determining the exact competitive price level and may instead state that prices should be reduced to a competitive level.
Possible remedies may include termination of excessive pricing, commitment to cost-based pricing principles, transparency obligations, non-discrimination rules, reporting obligations, or sectoral regulatory coordination. However, remedies must be practical and legally certain.
A vague order to “charge reasonable prices” may create uncertainty. Therefore, excessive pricing cases require careful remedy design.
21. Administrative Fines and Legal Consequences
If excessive pricing is found to violate Article 6, the undertaking may face administrative fines. Law No. 4054 provides that undertakings violating Articles 4, 6 or 7 may be fined up to 10% of their annual gross revenues. Managers or employees with decisive influence may also face fines of up to 5% of the fine imposed on the undertaking.
In addition to administrative fines, excessive pricing may lead to reputational harm, customer claims, private damages actions, contract disputes and regulatory attention. If the product is essential or politically sensitive, the public impact may be significant.
22. Practical Checklist for Excessive Pricing Risk
A company should ask:
Are we dominant in the relevant market?
Do customers have realistic alternatives?
Are entry barriers high?
Can high prices attract new entry?
Are prices significantly above cost?
Can the difference be justified by economic value?
Are price increases linked to cost increases?
Is the product essential or crisis-sensitive?
Is the sector regulated?
Do internal documents show exploitation of dependency?
Are business users or consumers locked in?
Do we have evidence supporting our pricing?
Have legal and economic teams reviewed the issue?
If several answers create concern, the company should conduct a detailed competition law assessment before implementing or maintaining the price.
23. Practical Checklist for Complainants
A complainant should prepare evidence showing:
Relevant market definition.
Dominance.
Lack of effective substitutes.
High barriers to entry.
Customer dependency.
Price history.
Cost-price gap, if available.
Competitor or comparator prices.
Lack of objective justification.
Consumer or business-user harm.
Market inability to self-correct.
Without this evidence, an excessive pricing complaint may be seen as a commercial grievance rather than a competition law violation.
Conclusion
Excessive pricing under Turkish Competition Law is a controversial and exceptional form of abuse of dominance. It is assessed under Article 6 of Law No. 4054, even though Article 6 does not expressly mention excessive prices. Turkish practice treats the list of abusive conduct in Article 6 as illustrative, allowing excessive pricing to be considered where a dominant undertaking exploits customers through prices that are unreasonably high compared with economic value.
However, excessive pricing intervention must be cautious. High prices alone are not enough. The undertaking must be dominant, the market must lack effective self-correction, and the price must be unjustifiable by cost, quality, risk, investment or economic value. Markets with legal monopolies, exclusive rights, high entry barriers, low demand elasticity or strong network effects are more likely to raise concern.
The Sahibinden case shows both the relevance and difficulty of excessive pricing in digital platform markets. The Competition Board found excessive pricing in online platform services and imposed a fine, but the decision was later annulled by the Ankara 6th Administrative Court due to evidentiary concerns and the need for clear, precise and data-based proof.
For dominant undertakings, the safest approach is proactive compliance. Major price increases should be supported by cost data, economic-value analysis, market conditions and clear internal documentation. Digital platforms should be especially careful where business users depend on access to the platform. For complainants, excessive pricing claims must be supported by serious economic evidence, not merely dissatisfaction with high prices.
In Turkey’s competition law environment, excessive pricing is not a routine price-control tool. It is an exceptional abuse theory used where dominance, market failure and unjustified exploitation can be proven. Companies that understand this distinction can price lawfully while reducing the risk of investigations, fines and reputational harm.
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