Introduction
Settlement and commitment procedures before the Turkish Competition Authority have become two of the most important procedural tools in Turkish Competition Law. These mechanisms allow competition law cases to be resolved more efficiently, reduce procedural burden, and provide companies with strategic options during preliminary inquiries and investigations. For undertakings operating in Turkey, understanding the difference between settlement and commitment is essential because each mechanism has different legal consequences, different timing rules and different strategic implications.
The main legal basis is Article 43 of Law No. 4054 on the Protection of Competition. Law No. 4054 regulates anti-competitive agreements, concerted practices, decisions of associations of undertakings, abuse of dominant position and merger control. The law applies to conduct affecting markets in Turkey and gives the Turkish Competition Board broad investigative and enforcement powers. The 2020 amendments introduced the modern framework for commitment and settlement mechanisms, while later secondary legislation clarified procedural details. The Commitment Communiqué entered into force in 2021, and the Settlement Regulation was also published and entered into force in 2021.
Although settlement and commitment are sometimes discussed together, they are not the same. A commitment procedure is designed to remove competition concerns through behavioral or structural commitments offered by the undertaking. A settlement procedure, on the other hand, is based on the investigated party’s acceptance of the existence and scope of the infringement and may result in a reduction of the administrative fine.
For companies, the choice between litigation-style defense, commitment, settlement, leniency or full contestation must be made carefully. A wrong procedural choice may increase legal exposure, weaken future litigation strategy, or create civil damages risks. A well-planned strategy, however, can shorten proceedings, reduce fines, preserve commercial relationships and limit reputational harm.
1. Legal Background of Settlement and Commitment in Turkey
The Turkish competition regime is mainly built around Articles 4, 6 and 7 of Law No. 4054. Article 4 prohibits anti-competitive agreements, concerted practices and decisions of associations of undertakings. Article 6 prohibits abuse of dominant position. Article 7 regulates mergers and acquisitions that may significantly lessen effective competition.
Settlement and commitment procedures are mainly relevant to investigations concerning Articles 4 and 6. They are not ordinary merger control remedies under Article 7, although commitments can also be relevant in merger control cases through a separate merger review framework. In the context of Article 43, commitment and settlement are procedural tools used in preliminary inquiries and investigations concerning restrictive agreements and abuse of dominance.
Article 43 provides that undertakings or associations of undertakings may offer commitments during an ongoing preliminary inquiry or investigation to eliminate competition concerns arising under Articles 4 or 6. If the Board concludes that the proposed commitments can remove the relevant competition concerns, it may make them binding and decide not to open an investigation or to terminate an existing investigation.
The same Article also regulates settlement. After an investigation has been opened, the Board may initiate settlement upon request or ex officio, considering procedural efficiencies and differences of opinion regarding the existence or scope of the infringement. The Board may settle with investigated undertakings or associations of undertakings until the notification of the investigation report, provided that they accept the existence and scope of the infringement.
2. What Is the Commitment Procedure?
The commitment procedure allows an undertaking to propose measures that address the Turkish Competition Authority’s concerns without necessarily going through a full infringement decision. It is particularly useful where the competition concern can be eliminated by changing commercial behavior, contract terms, access conditions, platform rules, distribution practices or market conduct.
Commitments may be behavioral or structural. A behavioral commitment may include changing contract clauses, removing exclusivity obligations, allowing access to a platform, revising data practices, ending discriminatory treatment, modifying rebate systems, removing resale restrictions or changing online sales policies. A structural commitment may involve divestment or separation of certain assets or business functions, although structural commitments are generally more demanding and less common outside merger control.
The purpose of the commitment mechanism is not to punish past conduct but to remove ongoing or likely competition concerns. This makes it especially attractive where the company wants to avoid a long investigation, prevent a formal infringement finding and implement a practical solution.
The Turkish Competition Authority announced that Communiqué No. 2021/2 on Commitments was accepted by the Competition Board on 11 February 2021 and published in the Official Gazette on 16 March 2021. This Communiqué regulates commitments submitted in preliminary inquiries and investigations concerning restrictive agreements, concerted practices, decisions and abuse of dominance.
3. When Is Commitment Not Available?
Commitment is not available for all competition law concerns. Article 43 expressly excludes clear and hardcore violations such as price fixing between competitors, market or customer allocation, and restriction of supply. In other words, where the alleged conduct is a serious cartel-type infringement, the Board will not accept commitments as a way to close the case.
This limitation is important. A company accused of resale price maintenance, online sales restrictions, exclusivity concerns or certain abuse of dominance practices may consider commitments depending on the case. However, a company accused of a cartel involving price fixing, bid rigging, market sharing or output restriction should not assume that a commitment route will be available.
The reason is simple: hardcore violations are considered particularly harmful to competition. They usually require deterrent sanctions rather than forward-looking behavioral corrections. In such cases, settlement, leniency or full defense may become more relevant than commitments.
4. Strategic Advantages of Commitments
The commitment procedure may provide several strategic advantages for companies.
First, it can shorten the process. A full investigation may take significant time, consume management resources and create uncertainty. Commitments can resolve competition concerns earlier if the Board is satisfied.
Second, commitments may avoid a formal infringement decision. This is highly important from a reputational and civil liability perspective. A formal infringement decision may support follow-on damages claims, while a commitment decision generally focuses on eliminating concerns rather than establishing liability.
Third, commitments allow the company to shape the remedy. Instead of waiting for the Board to impose measures, the undertaking may propose commercially workable solutions. This can reduce operational disruption.
Fourth, commitments may preserve commercial relationships. For example, in a distribution case, the company may revise dealer contracts, online sales rules or marketplace policies without completely dismantling its business model.
However, commitments are not risk-free. Once accepted, they become binding. Failure to comply may lead to reopening of the investigation and possible sanctions. Article 43 states that the Board may reopen an investigation if there is a material change in the basis of the decision, if the undertaking acts contrary to its commitments, or if the decision was based on incomplete, incorrect or misleading information.
5. What Is the Settlement Procedure?
Settlement is a different mechanism. It is used after an investigation has been opened. It allows the investigated undertaking to accept the existence and scope of the infringement and obtain a reduction in the administrative fine.
Under Article 43, the Board may initiate settlement upon the request of the parties or ex officio. The Board considers the procedural benefits of concluding the investigation quickly and the possible differences of opinion regarding the existence or scope of the infringement. Settlement is possible until the investigation report is served.
The settlement process ends with a final decision that includes an infringement finding and an administrative fine. Therefore, unlike commitments, settlement does not avoid an infringement finding. The investigated party accepts the infringement, and the Board imposes a fine, usually with a reduction.
The legal benefit is that the fine may be reduced. Article 43 provides that, as a result of the settlement procedure, a reduction of up to 25% may be applied to the administrative fine. The same provision also states that settlement-related reductions do not prevent the application of the discount under Article 17/6 of the Misdemeanors Law, where applicable.
6. Settlement Regulation and Procedural Framework
The detailed procedural framework for settlement is governed by the Settlement Regulation. The Turkish Competition Authority announced that the Regulation on Settlement Procedure Applicable in Investigations Concerning Restrictive Agreements, Concerted Practices, Decisions and Abuse of Dominance was accepted by the Competition Board on 24 June 2021 and published in the Official Gazette on 15 July 2021.
Settlement must be handled with precision. The undertaking must understand the allegations, the evidence, the likely fine range, the expected reduction, and the legal consequences of accepting the infringement. A settlement submission should not be treated as a simple administrative form. It is a strategic legal act.
The most important consequence is the restriction on judicial challenge. Article 43 states that where the process ends with settlement, the administrative fine and the matters included in the settlement text cannot be challenged by the settling parties.
This makes settlement a serious decision. A company may benefit from fine reduction and procedural certainty, but it gives up certain litigation opportunities. Therefore, before accepting settlement, the company must evaluate whether the evidence is strong, whether the alleged infringement is likely to be upheld, and whether the fine reduction justifies the loss of challenge rights.
7. Commitment vs. Settlement: Key Differences
The difference between commitment and settlement can be summarized as follows.
A commitment procedure is primarily remedial. It aims to eliminate competition concerns without necessarily requiring the undertaking to accept infringement. It may be available during preliminary inquiry or investigation. It is not accepted for clear and hardcore violations such as price fixing, customer or territory allocation and restriction of supply. If commitments are accepted, the Board may decide not to open an investigation or terminate an existing investigation.
Settlement is primarily punitive but accelerated. It requires acceptance of the existence and scope of the infringement. It is available only after an investigation has been opened and before the investigation report is served. It ends with a final infringement decision and administrative fine, but with a possible reduction of up to 25%.
For businesses, this distinction is crucial. Commitment may be preferable where the company believes the concern can be cured without admitting liability. Settlement may be preferable where the evidence is strong, the company wants to reduce the fine and avoid a prolonged investigation.
8. Which Cases Are Suitable for Commitment?
Commitment may be suitable in cases involving ongoing market concerns that can be resolved through clear, monitorable and effective measures. Examples may include certain exclusivity arrangements, online sales restrictions, platform access rules, discriminatory practices, data access issues, most-favored-customer clauses, certain abuse of dominance concerns, restrictive distribution conditions or contract clauses that can be amended.
For instance, an online platform may offer to revise seller access rules, remove discriminatory ranking criteria, limit self-preferencing practices or improve transparency. A supplier may offer to remove restrictive clauses from distribution contracts. A dominant undertaking may offer non-discriminatory access conditions. A marketplace may revise data-use practices.
The proposed commitments must be sufficiently clear. Vague promises such as “we will comply with competition law” are not enough. The Board must be able to assess whether the commitments will actually eliminate the competition concern. The company should also be able to implement and monitor them internally.
9. Which Cases Are Suitable for Settlement?
Settlement may be suitable where the company faces significant infringement risk and wants to reduce exposure. It may be considered in resale price maintenance cases, certain vertical restrictions, abuse of dominance investigations, information exchange cases or other Article 4 and Article 6 matters where the evidence is difficult to overcome.
Settlement is also useful where the company wants to reduce procedural uncertainty and management distraction. A long investigation may require written defenses, economic analysis, employee interviews, hearings, evidence review and possible judicial proceedings. Settlement may shorten the process and create a predictable outcome.
However, settlement should not be used automatically. If the evidence is weak, if the alleged conduct is legally mischaracterized, if the fine is disproportionate, or if a formal infringement decision would create major damages exposure, the company may prefer to defend the case fully.
The Turkish Competition Authority has publicly emphasized that commitment and settlement procedures have increased its efficiency in fighting competition infringements and are quick and efficient methods concerning competition violations.
10. Fine Reduction in Settlement
The most visible advantage of settlement is the potential reduction in administrative fines. Article 43 allows a discount of up to 25%. The exact reduction depends on the Board’s assessment and the procedural framework.
Recent enforcement announcements show that settlement reductions are practically important. For example, in 2025 the Turkish Competition Authority announced that an investigation concerning Fakir Elektrikli Ev Aletleri concluded with a finding of violation of Article 4 and that a 25% settlement discount should be applied to the administrative fine.
A fine reduction can be commercially significant, especially where the fine is calculated on turnover. However, the company should not focus only on the percentage discount. It should also consider the base fine, the legal characterization of the conduct, possible follow-on damages claims, publicity, reputational impact and appeal restrictions.
11. Legal Consequences of Settlement
Settlement has several important legal consequences.
First, the undertaking accepts the existence and scope of the infringement. This is the central difference from commitment.
Second, the Board issues a final decision containing an infringement finding and administrative fine. The case ends more quickly, but it does not end without liability.
Third, the administrative fine and matters included in the settlement text cannot be challenged by the settling party. This makes the settlement text extremely important.
Fourth, settlement may influence private damages litigation. A final infringement decision may be used by claimants seeking compensation. Therefore, the company should assess civil exposure before settling.
Fifth, settlement may require internal remediation. Even after settlement, the company should review contracts, employee conduct, pricing policies, distribution systems and compliance procedures to prevent recurrence.
12. Legal Consequences of Commitments
Commitments also create binding legal consequences.
If the Board accepts commitments, it can make them binding on the undertaking. The company must implement them as promised. This may require contract amendments, internal policy changes, platform modifications, reporting obligations, access arrangements or monitoring mechanisms.
If the company fails to comply, the Board may reopen the investigation. Article 43 also allows reopening where there is a material change in the elements underlying the decision or where the decision was based on incomplete, incorrect or misleading information.
Therefore, companies should not offer commitments that they cannot implement. A commitment must be legally sound, operationally realistic and internally enforceable. Before offering commitments, the company should consult commercial, technical, legal and compliance teams.
13. Interaction with Leniency
Settlement should not be confused with leniency. Leniency is mainly relevant in cartel cases. It allows cartel participants to obtain immunity or fine reductions by actively cooperating with the Authority to reveal the infringement. Settlement, by contrast, is a procedure that may apply after an investigation is opened and requires acceptance of the infringement.
In cartel cases, leniency may be more important than settlement, particularly for the first applicant. However, settlement and leniency may sometimes interact strategically. A company involved in a serious cartel issue should urgently assess whether leniency is available before considering settlement.
Commitments are generally not available for hardcore cartel conduct. Therefore, for price fixing, bid rigging, market allocation or output restriction cases, the realistic procedural options are usually leniency, settlement or full defense.
14. Practical Strategy for Companies Under Investigation
A company facing a Turkish Competition Authority investigation should not decide on commitment or settlement without a structured assessment.
First, the company should understand the allegations. Are they based on Article 4, Article 6 or both? Are they horizontal, vertical or dominance-related? Do they involve hardcore conduct?
Second, the company should assess the evidence. What did the Authority find during on-site inspections? Are there emails, WhatsApp messages, contracts, price lists, meeting notes or internal presentations?
Third, the company should evaluate legal characterization. Does the conduct clearly amount to an infringement, or are there strong legal and economic defenses?
Fourth, the company should assess business impact. Would commitments disrupt the commercial model? Would settlement damage reputation or increase damages exposure?
Fifth, the company should consider timing. Commitment must be offered in a timely and procedurally proper way. Settlement is possible only until the investigation report is served.
Sixth, the company should prepare internally. If commitments are proposed, operational departments must confirm feasibility. If settlement is considered, management must understand the acceptance and appeal consequences.
15. Role of Competition Compliance Programs
Settlement and commitment procedures should not be viewed as substitutes for competition compliance. They are tools for resolving cases after concerns have already arisen. A strong compliance program remains the best protection.
Companies operating in Turkey should train employees on cartel risks, resale price maintenance, online sales restrictions, dominance, trade association participation, HR competition risks and dawn raid response. They should also review contracts, internal communications, pricing policies and distribution systems.
A company that has used settlement or commitments should treat the case as a compliance warning. After the case, it should conduct internal audits, revise risky documents, train employees and create monitoring systems. Repeat violations may lead to more serious enforcement consequences.
16. Common Mistakes in Commitment Applications
One common mistake is offering vague commitments. A commitment must be clear, specific and capable of eliminating the competition concern. General statements of future compliance are not enough.
Another mistake is offering commitments too late or without internal feasibility analysis. If the business cannot implement the promised changes, the company may later face breach consequences.
A third mistake is trying to use commitments for hardcore cartel allegations. Since clear and serious violations such as price fixing, customer or territory allocation and supply restriction are excluded, a commitment strategy is not suitable for such cases.
A fourth mistake is ignoring monitoring. If the commitment requires ongoing compliance, the company should assign responsibility, create reporting systems and preserve evidence of implementation.
17. Common Mistakes in Settlement Decisions
The most serious settlement mistake is accepting infringement without understanding future consequences. Settlement may reduce fines, but it can also affect damages claims, reputation and appeal rights.
Another mistake is focusing only on the percentage discount. A 25% discount may appear attractive, but if the base fine is high or the infringement characterization is too broad, settlement may still be costly.
A third mistake is failing to coordinate settlement with global exposure. Multinational companies should consider whether a Turkish settlement may affect investigations, litigation or disclosure obligations in other jurisdictions.
A fourth mistake is not revising internal compliance after settlement. A settlement decision should be followed by a serious remediation program.
18. Why Foreign Investors Should Pay Attention
Foreign investors operating in Turkey should understand settlement and commitment procedures because competition investigations may arise after acquisitions, distribution restructuring, platform launches, pricing policy changes or market expansion.
A foreign parent company may acquire a Turkish business and later discover that the target’s distribution contracts contain resale price restrictions. A digital platform may face allegations concerning seller access or data use. A supplier may be accused of restricting online sales. A dominant undertaking may face complaints from competitors or customers.
In such cases, commitment or settlement may become part of the legal strategy. Foreign investors should involve Turkish competition counsel early because local procedure, timing, Board practice and Turkish-language filings are critical.
19. SEO-Focused Practical Checklist
Companies should consider the following checklist when dealing with settlement and commitment procedures before the Turkish Competition Authority:
Identify whether the case concerns Article 4 or Article 6.
Determine whether the allegation involves a hardcore violation.
Assess whether commitments can eliminate the competition concern.
Evaluate whether settlement is commercially and legally advantageous.
Review evidence obtained during dawn raids or information requests.
Estimate administrative fine exposure.
Assess possible private damages claims.
Consider reputational and public disclosure consequences.
Confirm whether management accepts the procedural consequences.
Prepare a compliance remediation plan.
Implement accepted commitments fully and monitor compliance.
Document all post-case corrective measures.
Conclusion
Settlement and commitment procedures before the Turkish Competition Authority are powerful legal tools, but they must be used carefully. The commitment mechanism allows undertakings to offer binding measures to eliminate competition concerns under Articles 4 and 6, potentially avoiding the opening of an investigation or ending an existing investigation. However, commitments are not accepted for clear and hardcore violations such as price fixing, customer or territory allocation and supply restriction.
Settlement is different. It requires acceptance of the existence and scope of the infringement and results in a final decision with an administrative fine. Its main advantage is the possibility of a fine reduction of up to 25%, but it also restricts the ability to challenge the fine and the matters included in the settlement text.
For businesses operating in Turkey, the key is strategic assessment. Commitment may be suitable where the concern can be solved through practical behavioral or structural measures. Settlement may be suitable where the evidence is strong and procedural certainty is valuable. Full defense may be preferable where the allegations are weak or the legal characterization is disputed.
A company should not treat either procedure as a routine administrative shortcut. Both mechanisms affect liability, reputation, commercial operations and future litigation risk. With proper legal analysis, internal investigation and compliance planning, settlement and commitment procedures can help companies manage Turkish competition law investigations effectively while reducing uncertainty and protecting long-term business interests.
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