The parties may engage in self-assessment as to whether a particular restriction could be deemed as ancillary. In case the transaction involves restraints with a novel aspect which have not been addressed in the Guideline on Undertakings Concerned and the Board’s previous decisions, upon the parties’ request, the Board may assess the restraints in question. In the event the ancillary restrictions are not compliant, the parties may face an Article 4 investigation. In its competitive assessment, the Board stated that the transaction led to a horizontal overlap in the port management for container handling services market and a vertical overlap in the container line transportation market. The Board applied the SIEC test rather than solely assessing whether the transaction led to the creation or strengthening of a dominant position in the relevant markets. As seen above, the tests provided under Article 7 include two separate tests; Article 7 is applicable only in cases of acquisition transactions while Article 7 is applicable only in cases of merger transactions.
Accordingly, shareholders’ agreements should be carefully reviewed by experienced counsel and additional protection mechanisms should be included to ensure the easy enforceability of terms under those agreements. The parties will determine the advisers and stakeholders to be involved, depending on the size and type of the transaction. For smaller and less complex transactions, legal counsel and tax advisers are generally involved in the initial preparatory stage of the transaction. Competition law counsel may also be included in the process, especially where the buyer and the target are competitors or where there are other competition law-related factors to be considered. Where necessary, financial advisers and investment bankers appointed by the parties may also participate. Subject to the specifications relating to the target, union representatives or employment consultants may be notified and involved at this stage.
What information may be published by the authority or made available to third parties?
% 50 of the gains realized from the sale of real estate property can be exempted from corporation tax in case of the real estate has been held for at least two years and gains are retained in a special reserve account in the Balance Sheet for at least five years. Foreign company can acquire Turkish company by acquiring either the assets or shares of the chosen company. As a result of merger, the assets of the transferor company will be inherited by either transferee company or a new organization depends on the merger type. We combine deep sector knowledge, superior analytic tools and a global mindset with local expertise to help you achieve results.
The article 7 of the Law on Protection of Competition No. 4054, dated 13 December governs mergers and acquisitions in Turkey. Recently, Law No. 7246 on the Amendment to Law No. 4054 on the Protection of Competition was published in the Official Gazette and entered into force on 24 June 2020 . Due diligence specific to the Foreign Corrupt Practices Act (“FCPA”) is deemed necessary when a target company has previously been subject to the FCPA, and also in situations when, following a transaction, the target becomes subject to the FCPA for the first time. The authorities do not find FCPA compliance efforts honest and adequate in the turkish lawyer cases where compliance concerns have only been reflected in contract drafts that allocate risks through representations and warranties. Foreign companies who want to invest in Turkey or establishing a new business in Turkey or enter into a deal with Turkish parties, always need to know about their counterparty and their economic background and their legal basis and whole company’s validity. Our Lawyers are prepared to help them through launching really strong due diligence and prepare a comprehensive report in this regard; and it is notable that we have been cooperating with some of leading companies in the world in this field.
Legislation overseeing M&A in Turkey
The reflections of these changes in practice will be observed as of 4 May 2022 when the Amending Communiqué comes into force. Recently, they are not subject to the obligation of notification of transactions carried out by enterprises with significant market power in digital markets and transactions in the form of acquisitions of newly established or developing enterprises. Therefore, it is also possible that these enterprises cannot be subject to the scrutiny of the competition authorities. This is one of the concerns expressed all over the world in terms of controlling mergers and acquisitions. Acquisition of assets can be only done through a Turkish company or a Turkish branch of a foreign company. Transfer of the assets should be conducted at the fair value and the transfer between related parties should be documented according to transfer pricing requirements.