Competition Law Regulations in Digital Markets: Platform Law with a Future

Considering the problems that may arise in terms of competition law in today's market where digitalization is progressing on a global scale, it is aimed to realize the regulations in the law numbered 4054. In this respect, online services, extension services and all kinds of information services provided in the digital market market include the activities of undertakings with significant market power (“SMP”) that may be the subject of competition law. In the Draft Law on the Amendment of the Law on the Protection of Competition (“Competition Law”) No. 4054 (“The Draft Law”), some criteria have been determined as to whether an undertaking has the qualification of SMP, and obligations for these undertakings in the sector in which the number of users is increasing day by day. This Draft Law, which includes definitions and administrative sanctions on digital market markets within the scope of the harmonization process with the European Union legislation, has similar characteristics with the Digital Markets Act (“DMA”).

The basic platform services defined in the Draft Law are the services that consumers constantly use in their daily lives and benefit from as a subscriber, and it is understood that the target audience of the regulation is very wide with this aspect. In addition, the criteria for undertakings with SMP determined in the Draft Law, the application process and subsequent obligations will create a healthy environment in terms of regulating competition between undertakings in digital markets, but the economic dimension of the administrative sanctions planned to be applied to undertakings due to violation of obligations will be open to criticism. Within the scope of the change that is aimed to be realized, the proof of whether the undertakings have SMP will be the undertaking's own, while the validity period of the determination regarding this has been determined as 3 years.

In the Draft Law, in line with the obligations targeting the undertakings with SMP, responsibilities belonging to the undertakings that even the consumers can directly observe have emerged. In this context, it is prohibited for the digital platform undertaking, which is one of the obligations, to discriminate between its own goods or services and the goods or services of its commercial users, under conditions such as sorting, scanning or indexing. For example, when you access Netflix to watch any content, a situation where Netflix-produced services stand out and other productions are presented to the consumer with negative discrimination may be considered a breach of obligation under the Draft Law. In case of violation of these obligations, which make the effectiveness of competition more open and transparent for users, various administrative sanctions are envisaged.

It has been stated that if the undertakings with SMP do not comply with the specified obligations, an administrative fine with a high percentage of 20% of their annual gross income will be imposed. In order to emphasize deterrence in terms of obligations, the Draft Law underlines the situations where mergers and acquisitions may be prohibited, as well as administrative fines. Mergers and acquisitions of the related undertaking, which owns SMP, which violates the obligations determined in this direction twice within five years, may be prohibited for up to five years. While it is questionable to what extent administrative sanctions overlap with the free market economy, its effectiveness can be predicted to be high. On the other hand, considering digital platforms under a separate heading in the context of competition law, it is understood that they can be distinguished from other companies in terms of their commercial entities and activities. Therefore, in terms of digital platforms, which will increase the market volume in the future, the necessity of regulations with the theme of "Platform Law" arises.