COMPENSATION CLAIMS IN COMPETITION LAW

Competition law is a branch of law that introduces various regulations to protect the free market economy and ensure that consumers and businesses operate in a competitive environment. This branch of law aims to prevent unfair competition, maintain market balance, and prevent monopolistic practices. Violations of competition law are not limited to criminal and administrative sanctions; they also grant the right to file compensation claims for parties harmed as a result of the violations.

Competition Law Violations and the Right to Compensation

Competition law violations are explicitly regulated in the Law No. 4054 on the Protection of Competition (Competition Law). This law prohibits agreements that hinder, distort, or restrict competition, decisions and concerted actions of associations of undertakings, and abuse of dominant position. The Competition Authority can impose administrative sanctions in response to these violations. However, administrative sanctions are insufficient to compensate the parties who are victims of the violation for the damages they suffer. At this point, private law provisions and compensation lawsuits come into play.

Businesses or individuals harmed by anti-competitive practices can claim compensation for the material and non-material damages they have suffered. In such cases, it is important to prove that the damage directly resulted from the anti-competitive practice. Article 57 of the law states that parties harmed by anti-competitive practices can file a compensation claim according to general provisions. This is evaluated within the framework of tort liability under the Turkish Code of Obligations.

Grounds for Compensation Claims

Compensation claims based on competition law violations are generally structured around three main pillars:

1. Compensation for Material Damages: This covers direct damages to assets resulting from a violation. For example, a company experiencing price increases due to a monopolistic practice can consider this a violation of competition law and claim compensation for the damages.
2. Compensation for Non-Pecuniary Damages: Situations such as reputational damage and market position loss caused by the breach may be subject to claims for non-pecuniary damages. Non-pecuniary damages aim to compensate for the psychological and commercial reputational losses suffered as a result of the breach.
3. Cartel Compensation: Cartels artificially inflate prices or restrict products in the market. In compensation lawsuits filed against cartels, the injured party can claim back the significantly higher price difference that they would not have to pay under normal market conditions.

Conditions for Compensation Claims

Certain conditions must be met for competition law violation claims to be successful. These are:

1. Competition Law Violation: In order for an injured party to claim compensation, there must first be evidence of conduct that violates the Competition Law. The violation must have been determined by the Competition Board.
2. Existence of Damage: To claim compensation, the existence of concrete damage must be proven. The damage can be material or non-material, but it must directly result from the breach.
3. Causal Link: A causal link must be established between the damage and the anti-competitive violation. In other words, there must be a direct connection between the damage suffered by the injured party and the anti-competitive violation.
4. Statute of Limitations: The statute of limitations is a crucial factor in compensation claims. According to the Competition Law, the injured party must file a lawsuit within two years of learning of the damage. However, in any case, compensation cannot be claimed after ten years have passed since the date the infringement occurred.

Burden of Proof in Compensation Cases

The party filing a compensation claim is responsible for proving the extent of the damage and that the antitrust violation caused it. However, since antitrust violations are often complex and determining the exact amount of damage can be difficult, courts may, in some cases, determine the amount of damage at their discretion. Expert opinions and economic analyses play a significant role in such cases.

Furthermore, decisions made by the Competition Board constitute important evidence in compensation cases. If the Competition Board issues a ruling of violation, the injured party can present this decision to the court and file a lawsuit. While the Board's decisions are not binding in courts, they can be used as evidence and may lighten the burden of proof.

Calculation of Compensation

Various methods are used to calculate damages resulting from competition violations. Courts apply comparative methods to determine the injured party's losses. For example, they assess what market conditions would have been like if the violation had not occurred and what position the injured party would have been in that case. Furthermore, in violations such as cartels, factors such as price differences, market loss, and loss of revenue are considered to determine the damages.

Conclusion

Compensation lawsuits based on violations of competition law offer victims an important legal avenue for recovering their losses. These lawsuits require the identification of a competition violation, the determination of the damage, and the establishment of a causal link between the violation and the damage. Decisions of the Competition Board can be used as evidence in compensation lawsuits, facilitating the proof process. However, as with all compensation lawsuits, expert opinions and detailed economic analyses are of paramount importance.