Saturday, November 01, 2008

Turkey - investigation into Turkcell

Competition Board launches investigation into Turkcell

The Competition Board has decided to launch an investigation into Turkey's leading GSM operator, Turkcell, over the company's promotional campaigns, which promise to send credits to the owners of prepaid cards or free minutes to those who pay monthly via contract if they buy certain brands of products.

If Turkcell is found to be guilty at the end of this investigation, a fine as high as YTL 820 million may be imposed on the company.

Turkcell was also hit by a fine of YTL 22 million from the Competition Board in 2003, a record fine at the time, and an amount that sets to be potentially dwarfed by the Competition Board in its current investigation.

According to a statement released on the Web site of the Competition Board, the board, in its meeting on Oct. 9, decided to launch an investigation into Turkcell to see whether it had violated Article 6 of law no. 4054 which legislates to protect competition.

Acting on complaints it had received, the board started to examine how Turkcell promotion campaigns have an effect on the market. The board gathered evidence that Turkcell's promotions campaigns created an unfair competition environment for the other GSM operators in the market as Turkcell is the dominant company in the market. After the preliminary investigation, the board decided to launch a full investigation.

If the board decides that Turkcell has violated competition regulations, a fine equal to 10 percent of its annual turnover may be imposed on the company. Turkcell had a turnover of YTL 8.2 billion in 2007.

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