Att. Dr. Çiğdem Akkan


One of the prominent concepts in recent years is information exchange in competition law, which we can describe as a very young branch of law, especially in Turkey. While information exchange had generally been evaluated within the scope of concerted practice or seen as a means of proof used for proving concerted practice, later on, it has been adopted, especially through jurisprudence, that information exchange is actually an action that alone can constitute a violation of competition. Despite this, there is no complete clarity on the subject, since the Act No. 4054 on the Protection of Competition does not explicitly mention the exchange of information and that this may be a violation of a distorting nature. For this reason, this study has been prepared considering that it would be necessary and useful to present the general outlines of the subject by compiling the regulation and decisions regarding the exchange of information in Turkey, USA and EU countries.

The Concept of Information Exchange

The concept of information exchange can be defined as two and more independent enterprises operating in the same market and in a horizontal or vertical relationship with each other, sharing information about their own business (production amount, sales amount, pricing, profit margin, future-oriented strategies, etc.) or the market in which they operate (numerical and statistical increases in the total supply and demand, average price intervals, concentration ratio in the market, etc.) mutually or unilaterally.

In our study, information exchange among competitors at the horizontal level is examined in detail, and vertical information exchange is outside the scope of our study.

The Evolution of Information Exchange in Terms of Competition Law and Cases It Creates Anti-Competitiveness

Information exchange can have many positive effects on competition, as well as creating anti-competitiveness in terms of purpose or effect. Consumer interests come first among the competition-enhancing effects of information exchange. If the information exchange reaches the consumers without being left among the competitors, the transparency that will occur in the market will help the consumers to have full information about the products and the services in the market and to choose the product that best suits their interests in the shortest time and at the least cost. Other positive effects of information exchange on competition are that it improves the predictions of the undertakings for the future and facilitates the new entrance to the market through the generally transparency that will occur in the market through the exchange of information.

It is accepted that the best system available on the markets is a workable competitive system. In a workable competitive system, competitors can freely compete with each other, determine their own market policies independently of each other, and have freedom in entering and exiting the market. In addition, competitors have to make efforts to improve product/ service quality, invest in R&D, and keep prices at an optimum level for consumers in order to compete with each other better. All these market conditions are positive effects for consumers.

Information exchange among competitors is considered anti-competitive if it has the purpose or effect of preventing or restricting workable competition in the market within the scope of the nature of the exchanged information. In this context, the most undesirable information to be shared in terms of competition law is competitively sensitive information. Another concept that comes to mind first when talking about competitively sensitive information is the concept of “trade secret”. It is inevitable that information that is legally qualified as a trade secret is also considered as competitively sensitive information. The definition and elements of trade secret have been examined in detail in our book, and we are content to refer to the relevant part here (pp. 201-204). Price and quantity information is at the forefront of competitively sensitive information. In addition, information on demand and costs is also considered within the scope of competitively sensitive information. In particular, price information for the future is the most competitively sensitive information. Sharing future price information among competitors is considered to be anti-competitive per se.

Not every piece of information shared among competitors constitutes anti-competitiveness. When examining the effects of information exchange on competition, rule of reason analysis should be conducted under three main headings. These are; the characteristics of exchanged information, the structure of relevant market and product, and the characteristics of the undertakings participating in the information exchange.

The first factor to be considered carefully in the rule of reason analysis is the characteristics of the exchanged information. Since we have mentioned competitively sensitive information above, we do not feel the need to explain it again here. Another issue to examine is whether the information is publicly available or not. If the shared information is only shared among competing undertakings and it is not possible for the consumers to access the shared information, it is possible that this information exchange will have a distorting effect on competition. However, if the shared information is shared publicly and accessible to everyone under equal conditions (e.g.; through a newspaper advertisement, television advertisement, press release etc.), it is unlikely that this information exchange will have a negative effect on competition.

Another element to be examined is whether the shared information is of individual or cumulative (aggregated) nature. The information in question is considered cumulative information if the shared information does not explain the data of the undertakings in a distinctive way and in detail together with their sub-fractions, and if it relates to general data over the total numbers of undertakings operating in the relevant market. Some information, for example; the total export amounts of the undertaking operating in the relevant market, the total sales amounts, the percentage rate of increase or decrease in the total supply amount compared to the previous three months, etc., is cumulative information, and sharing this information is not considered objectionable in term of competition law. On the other hand, the information regarding the disclosure of the export figures of each undertaking is in the nature of individual information and it is likely to have a distorting effect on competition.

Whether information exchange is unilateral or reciprocal should be taken into account in terms of its effects on competition. While mutual information exchange is considered to have a higher potential to distort competition, unilateral information disclosures may not always have an impact on competition. In this context, what needs to be examined is whether unilateral information disclosure is true and binding. Here, unilateral future price announcements are important. It is accepted that such price disclosures may function as an offer to compromise for competitors, if there is no binding element; in the other words, if there is a stipulation that prices can be changed. At his point, it is important how competitors respond to unilateral price disclosure.

The time period of the exchanged information and the frequency of the information exchange are two other important features that need to be examined. It is accepted that sharing historical information does not have the potential to distort competition, while sharing of future-oriented information among competitors is likely to have a restrictive effect on competition. However, there is a general rule about a piece of information will be considered historical information, and each sector should be evaluated within the framework of its characteristics. This is because while five years of information will be accepted as historical information in some markets, a month or even a week of information may be considered historical information in dynamic markets that change very quickly.

The level of transparency of the relevant market, the concentration rate in the market, the homogeneity rate of the product, the static or dynamic market conditions, the symmetry among the undertakings operating in the market, the market shares of these undertakings and their market power are the other elements that should be considered in the evolution of the effects of information exchange on competition.

In conclusion; every information exchange activity is not a violation in terms of competition law. All conditions should be evaluated together and in detail in order to determine whether a competition violation has occurred; should be examined in terms of safe harbors and the de minimis rule. It should be carefully evaluated whether the similar commercial behaviors that occur especially in the oligopoly markets is the information sharing among competitors or mutual oligopolistic dependence.

Kew words: Information Exchange, Rule of Reason, Purpose or Effect of Preventing or Restricting Competition, Competition-enhancing Effects