Ercüment Erdem Att. Mert Karamustafaoglu

Expected Second Half of Competition Authority’s 12 Banks Decision

June 2019
“Awaited always comes late; when it comes, people are somewhere else.”
Oğuz Atay (The Disconnected)


The Competition Authority’s decision which the highest administrative fine imposed in its history is known as the “12 Banks Decision”[1]. In this decision, the Competition Authority (“Authority”) has reviewed the investigation of the competition violation claims in the deposit, credit and credit card markets, and imposed heavy administrative fines upon 12 banks, in which Turkey’s largest banks are included. The 12 Banks Decision has imposed a TL 1 billion administrative fine, in total, which comprises thousands of compensation cases. In this Decision, the Authority has assessed that the mentioned banks were in breach of competition in the deposit, credit and credit card services markets between the years 2007 and 2011. Detecting such a wide-ranging competition violation naturally induced the filing of thousands of customer cases.

In the history of Turkish competition law, the 12 Banks Decision is a first in many respects, especially the imposed fine is the record as being the greatest administrative fine imposed by the Authority in one file. In addition, a very interesting development has taken place after this Decision. Thousands of customers have filed compensation cases based on this decision against the banks that are mentioned in the Decision. With this Decision, the results of competition law in private law have started to arise in Turkey. However, the 12 Banks Decision has brought various problems with it in terms of these compensation cases.

Firstly, the issue of which bank, in which market, and from which date it is in violation, is not clearly stated in the said Decision. In other words, although a broad infringement covering more than one market has been detected, it is not clearly included in the Decision as to which bank, in which market has experienced what kind of infringement. This has brought serious questions within, especially in terms of the consumer cases. Moreover, the concept of “one single continuing reconciliation” is one of the most discussed issues. Despite the evidence in the mentioned Decision that refers to different dates and different markets, holding all banks responsible for violations in all three markets is one of the most important criticisms of the Decision.

The 13th Chamber of the Council of State had put its signature under a radical development regarding the 12 Banks Decision with its recently rendered decision[2] (“Council of State Decision”). The Council of State accepted the revision of Decision requests in the cases filed against the mentioned Decision. Thus, all known rules have been re-established in terms of compensation cases arising from the 12 Banks Decision and competition law.

12 Banks Decision of Council of State

Firstly, an annulment suit was filed before the Ankara 2nd Administrative Court against the 12 Banks Decision of the Authority, but the annulment request was rejected with the decision of the said court dated 30.10.2019 and numbered 2014/313 E. and 2015/128 K. Yet, the request of appeal made before the 13th Chamber of the Council of State was also rejected with the Decision of the said court dated 16.12.2015 and numbered 2015/3590 E., 2015/4614 K. Thereupon, the revision of Decision has been requested regarding the 12 Banks Decision.

Surprisingly, at the end of the trial and upon the revision of Decision request, the Council of State has accepted the revision request and annulled the Decision of the Ankara 2nd Administrative Court regarding the rejection of the annulment request of the 12 Banks Decision. Therefore, in a sense, the possibility of annulment of the most prominent and most important decision of the Authority has very strongly emerged. In a sense, the second half of a contentious football match has begun.

Essentially, the Council of State’s Decision determined that the Authority has erroneously applied the concept of ‘one single continuing breach’. The Council of State indicates that with respect to the concept of ‘one single continuing breach’, the enterprises that have formed several elements of a framework agreement could be held responsible for all of the breach. In order for this concept to be used, the Council of State determines a proof standard. Therefore, in order for an enterprise to be held liable for the actions of other enterprises that constitute breaches regarding different market and products, it must be proven that this enterprise is aware of, or is at least capable of being made aware of these breaches. Pursuant to this concept, in order for an enterprise to be held responsible for the breaches of other enterprises in other markets, some aspects should be proven. Therefore, the mentioned enterprise should know, or be capable of knowing, these behaviors that are claimed to have occurred within the framework of the mutual plan.

Therefore, the Council of State states that in terms of the 12 Banks Decision, it should be proven that the enterprises that have formed certain aspects of the framework agreement as per the mutual plan knows (or is capable of knowing) other aspects. The Council of State stated clearly that unless otherwise mentioned, an enterprise is liable only through its involvement in the breach of competition.

One of the most important determinations of the Council of State’s Decision concerns responsibility under private law. The Council of State underlines the importance of properly determining the borders of the mutual plan and the framework agreement, and states that it is critical for the determination of the enterprises’ liability. The Council of State indicates that a mistake could extend an enterprise’s liability and, consequently, the administrative fine, limitations, and compensation cases. In other words, the Council of State has pointed to the danger of unjust consequences arising from an error made on this issue.

With this perception, the Council of State has analyzed the evidence in the 12 Banks Decision, and has grouped certain of the documents and the markets (deposit, credit and credit card services) that the evidence belongs to. After revealing the markets of 28 documents that are referred to in the Decision, the Council of State determined that there is no proof of an existing link between the actions of the different enterprises. In other words, the Council of State found that it has not been proven that some enterprises with evidence regarding one or two markets were aware of a general framework and mutual plan covering the deposit, credit, credit card and public deposit services. This matter was seen as a proof standard problem, and it was so stated that the 12 Bank Decision was made based on an incomplete examination.


In the song titled “Rosenrot” of the German music band, Rammstein, the words say that “in order to find clear and clean water, one must dig deep wells”[3]. Indeed, the benefits to be realized in terms of Decisions, such as the 12 Banks Decision, which concern millions of consumers, depend on this clarity. It is important that all uncertainties to be eliminated by the Competition Authorities, in such a way so that they can be easily understood by the courts. In this case, even though this may present various challenges for the Competition Authorities in terms of the proof standard, the Decision, it is essential that it be clear and easy to understand, especially for private law enforcement.

Even though the Authority’s12 Banks Decision is an important and remarkable decision due to the amount of the administrative fine and its determinations, it has come under heavy criticism, especially due to the manner of using the concept “one single continuing breach,” and the uncertainties caused by this usage. It is possible that the uncertainties that this decision creates has delayed the results of the compensation cases that have been filed, and which are based on this Decision.

The Council of State has accepted the revision of the Decision appeal, even though is late. Now, everything is going to start from the beginning, legally, and in the event the Decision is annulled, it will be necessary for another decision to be rendered. Thus, the chance of answering many questions that have not been answered thus far has arisen once again. In this sense, it is possible to reconsider everything and to produce completely different results, much like the second half of a football competition.

The 12 Banks Decision is a milestone, especially in respect of compensation cases arising from competition law. For this reason, it is clear that developments in this area are closely related to thousands of compensation cases. The most important contribution that the Competition Authority can make to these cases in the re-decision process is to clearly answer the questions of “which bank, in which market, and what time interval is involved.” This necessitates the precise connection between the evidence and the actions of the banks. If this is not done, perhaps the most important Decision in the history of Turkish Competition Law will remain incomplete. Therefore, for ‘a fairer second half’, all uncertainties of the ‘game’ must be eliminated, because clean and clear water is found in deep wells.

[1] (Access date: 30.06.2019).

[2]The Decision 13th Chamber of the Council of State No. 2016/3587 E., 2019/1778 K., 21.05.2019.

[3]“Tiefe Brunnen muss man graben, wenn man klares wasser will.”