The Turkish Competition Authority’s Decision on the Unlawful Interest Applied by The Banks
The Turkish Competition Authority decided that the 12 banks operating within Turkey breached the Article 4 of the Law on the Protection of Competition numbered 4054 ( “Law”) with its decision numbered 13-13/198-100 and dated 08.03.2013 and as a result the administrative fines set out within the decision shall be paid pursuant to this decision.
The aforementioned decision was upheld upon the review by the 13th Chamber of the Council of State and the upholding decision was also finalized. Therefore, cause of action has arisen for real and legal persons that have received a loan, obtained depository or credit card services from the banks during the period set out within the decision of the Competition Authority as explained below.
The Ratio Decidendi of the Decision and the Right to Compensation
The evidence in relation to a collusion on their trade terms for cash deposit interests, credits and credit card fees by the 12 banks operating within the banking sector were reviewed by the Competition Authority.
Upon this review, it was determined that these banks have restricted competition by establishing the interest rates and fees together for the services set forth within the decision and as a result of these acts an accord on these services have occurred.
As per Article 4 of the Law “Agreements and concerted practices between undertakings, and decisions and practices of associations of undertakings which have as their object or effect or likely effect the prevention, distortion or restriction of competition directly or indirectly in a particular market for goods or services are illegal and prohibited”. Therefore the Competition Authority decided to impose administrative fines at varying amounts on these 12 banks due to infringing the Article 4 of the Law.
On the other hand as per the Article 57 of the Law “Anyone who prevents, distorts or restricts competition via practices, decisions, contracts or agreements contrary to this Act, or abuses his dominant position in a particular market for goods or services, is obliged to compensate for any damages of the injured. If the damage has resulted from the behaviour of more than one people, they are responsible for the damage jointly”. As a consequence these 12 banks are obliged to compensate any damage incurred due to this infringement and they are also jointly responsible for this damage.
The Scope of the Right to Compensate
As per the decision, during the period of 21.08.2007-22.09.2011 the interest rates were determined by the 12 banks via a collaborative act which prevented, distorted and restricted the competition. Therefore, the services of loan, deposit and credit card that were obtained from these banks during the aforementioned period may be subject to a claim for compensation.
Regarding the amount of compensation, the Article 58 of the Law, the decision of the Competition Authority and the expert reports that will be obtained during the litigation shall provide guidance among any other evidence that may be used.
Pursuant to the Article 58 of the Law, “Those who suffer as a result of the prevention, distortion or restriction of competition, may claim as a damage the difference between the cost they paid and the cost they would have paid if competition had not been limited”. Thus if for example a consumer loan was obtained from one of the 12 banks during the period determined by the decision, the difference between the interest that has been paid by the consumer and that should have been paid if there was no agreement between the banks may be claimed as damages.
The Article 58 also sets out that “if the resulting damage arises from an agreement or decision of the parties, or from cases involving gross negligence of them, the judge may, upon the request of the injured, award compensation by three fold of the material damage incurred or of the profits gained or likely to be gained by those who caused the damage”. In consequence the judge may award compensation by three fold of the material damage incurred.
The Claimants
As explained above the Article 57 does not make a distinction among the suffering parties. Also the decision of the Competition Authority does not differentiate between real and legal persons or private or public parties. Consequently it shall be possible for any real or legal persons including merchants, companies, foundations and associations to initiate a lawsuit for compensation.
Statute of Limitations
The statute of limitations is set forth as 10 years. Therefore, if a vehicle loan is used on 21.10.2007 by a general credit agreement of the same date, the claim is required to be brought at the latest on 21.10.2017.