Resurfacing Risks In Hybrid Settlements: Analysis Of TCA's Ankara Ready-Mixed Concrete Decision

REFERENCE: Turkish Competition Authority, Ankara Ready-Mixed Concrete Producers, Case No. 25-19/457-215, Decision, 15 May 2025

1. Introduction

The Turkish Competition Authority ("TCA") recently published its reasoned decision concerning a labor market investigation into 17 ready-mixed concrete producers operating in Ankara¹. The TCA found four undertakings² liable for anti-competitive wage-related information exchange; however, in our view, the decision is most significant for its procedural issues stemming from the hybrid settlement. Specifically, we think the hybrid settlement resulted in a paradox where Limmer was fined based on certain findings, yet that same evidence was found insufficient to convict its counterparty, Tiftik, in the final decision.

1. Background of the case

The investigation dates back to 2022, when the TCA initiated a probe into ready-mixed concrete producers in Ankara and Kırıkkale. Following inspections at Limmer, the TCA expanded its scope in April 2023 to investigate allegations that several producers exchanged competitively sensitive information regarding employee wages, potentially violating Article 4 of Law No. 4054 (similar to Art. 101 of the TFEU). The TCA issued its final decision on May 15, 2025.

In the following sections, we provide a summary of the case along with our analysis of specific matters.

1. Relevant market assessment

Before delving into the substantive assessment, the TCA first assessed the relevant market. The TCA noted that the ready-mixed concrete production process relies on a specialized category of operational personnel, including truck mixer, concrete pump, and plant operators. According to the TCA, these roles require high levels of technical expertise and specific certifications, such as vocational qualification certificates and driver documents. The TCA concludes that because each position demands distinct technical skills and legal permits, labor mobility between different roles is extremely limited. The TCA also mentioned that within this sector, undertakings function in a complex ecosystem where they are simultaneously competitors for labor and partners in logistics; firms frequently engage in subcontracting, equipment leasing, and personnel sharing to manage fluctuating demand, which inherently increases market transparency and facilitates communication between competitors.

The TCA stated that a critical factor defining the current state of the industry is a chronic and worsening labor shortage. According to Turkish Ready Mixed Concrete Association data, while the number of firms in the sector increased between 2018 and 2022, the total number of employees actually decreased by 5.3%. The TCA noted that this scarcity has been exacerbated by the migration of workers to earthquake reconstruction zones in Turkey, the preference of qualified personnel for overseas construction projects due to currency fluctuations, and a general lack of new trainees entering the field. As a result, according to the TCA, skilled operational labor has become a scarce and vital competitive input, making the retention and recruitment of these workers a primary point of competition among producers.

The investigation focuses on allegations that firms exchanged sensitive information regarding the wages and benefits of this operational staff to mitigate the pressures of labor competition. While the high degree of specialization for each role (e.g., pump operator vs. plant operator) could justify narrow product market definitions, the TCA characterized the relevant product market broadly as the "labor market for operational/field personnel in the ready-mixed concrete sector" due to the general nature of the evidence in the file. Geographically, while the mobility of the workforce is largely centered in Ankara, the migratory nature of specialized workers across provinces led the TCA to consider a broader scope, though a definitive geographic market definition was ultimately left open as it did not alter the substantive finding of the infringement.

1. TCA's substantive assessment

The TCA noted that the ready-mixed concrete sector in Ankara is characterized by a high number of producers where operational personnel play important role. The TCA observed that due to a shortage of labor supply and high circulation of personnel between firms, labor has become a key element of competition in the market. Consequently, according to the TCA, firms closely monitor the wages and raise rates applied by competitors to retain their own staff, sometimes utilizing market research or employee feedback, but in some instances, engaging in direct communication with competitors.

In this regard, we provide a summary of each finding in the case file, classified as either a violation or a non-violation by the TCA.

D.1. Violation findings

Finding 2 & 3: Information Exchange between Birlik and Güven

The TCA identified an Excel file (Finding 2), which contained sensitive wage and bonus data for several competitors. The investigation established that this file was directly shared by a Birlik official with a Güven official via email and WhatsApp (Finding 3). The TCA noted that the data was current, non-public, and highly disaggregated, covering specific operational roles. Although Güven argued the data was unsolicited and possibly incorrect, the TCA emphasized that Güven did not "publicly distance" itself from the information and even responded with a message of thanks. Consequently, the TCA ruled that this exchange is a violation of competition law.

Finding 4: Multi-Party Information Exchange (Birlik, Limmer, SY Ankara, and Yiğit)

The TCA found that on Birlik shared a salary table with officials from Limmer, SY Ankara, and Yiğit. This document included detailed cost breakdowns such as base salaries, overtime pay, and meal allowances for various technical positions. The TCA stated that such granular data allows competitors to align their labor costs and eliminates independent strategic uncertainty. Despite the recipients' claims that the email was unilateral or ignored, the TCA concluded that by receiving this information without a clear rejection, SY Ankara, Yiğit, and the settling parties (Birlik and Limmer) violated the competition law.

Finding 11: Direct Wage Communication between Kandemir and Limmer

The TCA uncovered a WhatsApp dialogue from early 2023 where a Limmer official explicitly requested wage information for plant operators from Kandemir. Kandemir official responded by providing specific monthly salary and production premium figures. The TCA noted that this direct communication regarding current and individualized cost elements constitutes a restriction by object.

D.2. Non-violation findings

The table below summarizes the some of the non-violation findings, as well as the TCA's assessment and reasoning for these conclusions.

1. Hybrid Settlement Problems

Several parties opted for settlement during the investigation. Notably, Limmer settled based on Finding 10, even though that same finding ultimately resulted in a no-violation conclusion for the other parties in the final investigation decision.

Regarding the assessment of the relevant evidence, the TCA evaluated a WhatsApp communication in which a representative from Tiftik inquired about employee salary levels. The TCA noted that this communication appeared to be strictly unilateral; there was no record of a written response from Limmer, and subsequent dawn raids at Tiftik failed to uncover any evidence that the information had been conveyed through other channels. Consequently, the TCA determined that because no reciprocal exchange of sensitive information occurred, this finding was insufficient to sustain an infringement claim against Tiftik. However, the TCA adopted a differentiated approach toward Limmer in its specific settlement decision. While the inquiry resulted in no violation for Tiftik, the TCA used as corroborative evidence against Limmer within the context of the settlement.

This is a compelling conclusion, and it is not the first time a hybrid settlement has yielded such results.

In a previous case involving seven fertilizer producers, İGSAŞ requested to initiate a settlement, which the TCA accepted. Upon completing negotiations, the TCA issued a final decision³ concluding that İGSAŞ had violated competition law by exchanging competitively sensitive information. Consequently, the TCA imposed an administrative fine and closed the investigation regarding İGSAŞ while continuing the probe into the other six undertakings. However, after assessing the practices of the remaining six undertakings, the TCA determined they had not engaged in anticompetitive practices. The TCA concluded that no violation had occurred and, therefore, imposed no fines on the non-settling parties⁴.

Similar to the Fertilizer case, the TCA's recent decisions concerning the second-hand market for Honda S2000 vehicles illustrate a paradox within the settlement mechanism again⁵. The case primarily hinged on two pieces of evidence: Finding 7 and Finding 2. Finding 7 involved a direct communication between the owners of Özgen Gallery and Canatar Auto, where a proposal to set a minimum price floor of 1,500,000 TRY was explicitly accepted. By opting for a settlement, these two undertakings admitted that this exchange constituted a price-fixing agreement under Turkish competition law. In contrast, ERY Motors chose to challenge the allegations rather than settle. The TCA's scrutiny of ERY Motors focused on Finding 2, a WhatsApp group chat where the relevant firm responded after following a price announcement by a competitor. While such a statement could be interpreted as price coordination, the TCA ultimately accepted the defense of ERY Motors that this remark referred to a different vehicle model, the Nissan 350Z, rather than the Honda S2000. Furthermore, an analysis of actual market data revealed that the price changes did not align with the figures discussed in the messages. Consequently, the TCA concluded there was insufficient evidence of a cartel for the non-settling party, resulting in no fine for ERY Motors.

Against the foregoing, these situations become even more significant when considering the procedural limitations in Turkey. Unlike EU competition law, under Turkish law, a settlement decision cannot be challenged in front of the courts. This is also criticized by scholars and practitioners in Turkey as well. The situation faced by İGSAŞ, specifically regarding the potential outcomes and the appeal ban for settlements in Turkey, has been a subject of criticism in scholarly doctrine.

Our team member, Aslı Ak, addresses this in her dissertation at King's College London, titled An Analysis on the Necessity of the Appeal Ban in Settlements under Turkish Competition Law: Reflections Inspired by the Fertilizer Case⁶. She argues that an appeal ban prevents an undertaking from challenging a competition authority's decision before an independent tribunal or court, thereby infringing upon the right of access to courts. She notes that a strict interpretation of Article 6 of the ECHR, to which Turkey is a party, suggests that such a ban constitutes a clear violation.

Another scholar in Turkey argues that if an unlawful difference in treatment arises between parties who settle and those who do not, the TCA is mandated to establish a new decision⁷. Furthermore, another scholar contends that such a discrepancy is incompatible with the principles of legal certainty and predictability⁸. According to her view, legal certainty requires that individuals can foresee the consequences of their actions and that administrative authorities maintain consistent practices in identical or similar circumstances. Only under these conditions can undertakings anticipate their legal standing and regulate their obligations accordingly. She further suggests that fining one undertaking involved in an infringement while leaving another unsanctioned undermines the predictability of administrative sanctions and may also create the impression that the administrative authority is acting arbitrarily.

1. 80% Reduction vs. 50% Reduction

One of the most interesting aspects of the investigation is the contrast in how the fines were calculated for different parties. For Güven, Kandemir, SY Ankara, and Yiğit (parties who do not settle), the calculation was relatively easy because their violations lasted less than one year. Since the duration was short, their base fine rates were not increased; additionally, because there were no aggravating factors, they received a significant 80% reduction under Article 7 of the New Regulation on Fines.

In contrast, the fine for Limmer was more complex due to a longer violation period and their choice to settle. Because their involvement lasted between one and five years, their base fine rate was first increased by 50%. However, they were granted a 50% reduction on that rate before the settlement phase, followed by an additional 25% settlement reduction.

The settling party and the non-settling parties were subject to different reduction rates within the same investigation. This discrepancy could be considered normal if the TCA viewed their levels of participation in the cartel differently. However, the decision lacks an explicit explanation as to why these rates varied. While the level of participation is the most logical explanation, the discrepancy likely stems from the timing of the settlement versus the final decision.

When Limmer settled, the Former Regulation on Fines was still in effect, capped reductions for mitigating factors at 60%. However, this regulation was repealed and replaced by the New Regulation on Fines⁹, which entered into force on December 27, 2024. This new framework abolished the fixed upper and lower limits for reductions related to mitigating factors, granting the TCA full discretion to apply higher rates, such as the 80% seen in this case.

In its final decision, the TCA correctly applied the New Regulation on Fines to the non-settling parties. This aligns with the general principle of Turkish Criminal Law, which dictates that if a law changes, the more favorable provision must be applied to the defendant. Unfortunately for Limmer, because their settlement was finalized under the old rules, they were unable to benefit from the higher reduction rates introduced by the new legislation.

A similar, though not identical, situation occurred previously in Turkey. In the Beypazarı/Kınık case¹⁰, a primary issue arose regarding the calculation of administrative fines. Although both undertakings opted for a settlement within the same year, Kınık's fine was based on its 2020 turnover, whereas Beypazarı's fine was calculated using its 2021 turnover.

While this practice resulted from the fact that 2021 revenues had not yet been finalized during the first quarter of 2022 when the settlement procedure took effect, it remains controversial regarding the principles of equality and legal predictability. Furthermore, since parties in Turkey waive their right to appeal upon settling, these discrepancies cannot be challenged under current legislation. In the European Union, however, the matter is handled differently since in Europe, settlement could be challenged under EU competition law.

In the Pometon SpA v Commission case, the Court of Justice of the European Union (CJEU) addressed the complexities of hybrid cartel proceedings. These proceedings occur when some companies settle while others opt for a standard adversarial process. Pometon, the only non-settling party in a steel abrasives cartel, initially faced a €6.2 million fine. The European Commission used "exceptional" reductions under its 2006 Fining Guidelines because a standard calculation would have exceeded the legal 10% turnover cap for most participants, failing to reflect their individual roles accurately.

Pometon challenged the fine, leading to a series of reductions. The General Court (GCEU) first lowered the fine to €3.8 million (a 75% reduction), but the CJEU ultimately set this aside. The CJEU ruled that the GCEU breached the principle of equal treatment by applying the same 75% reduction to Pometon as it did to Winoa, despite having already concluded that Pometon's involvement in the cartel was less serious. The CJEU emphasized that if situations are different, applying an identical reduction rate requires a specific objective justification, especially when departing from standard fining methodologies.

In its final reassessment, the CJEU reduced Pometon's fine to €2.6 million (an 83% reduction). It determined that Pometon's role was most similar to MTS, a settling party that received a 90% reduction due to its limited participation and low sales volume. By narrowing the gap between Pometon and MTS, the court ensured the fine was proportionate to the gravity of the infringement. Beyond the numbers, this ruling sets a critical precedent for protecting the rights of the defense in hybrid cases, ensuring non-settling parties are not unfairly penalized compared to their settling counterparts.

1. Why This Decision Matters & Conclusion

The TCA's decision serves as a landmark case for understanding labor market issues and the procedural pitfalls of hybrid settlements in Turkey. This ruling is significant because it indicates the TCA's aggressive stance against wage-fixing and information exchange.

We consider the most striking takeaway to be the procedural inconsistency created by the hybrid settlement. The fact that Limmer was fined based on evidence (Finding 10) that was later deemed insufficient to penalize Tiftik highlights a risk for undertakings. Under current Turkish law, a party that settles effectively freezes the facts against itself. This remains true even if those same facts are later debunked or re-evaluated in the final decision for non-settling parties.

The discrepancy in fine reductions raises questions about equality. Non-settling parties benefited from a more favorable 80% reduction under the New Regulation on Fines, while the settling party remained bound by the old regime. This timing trap suggests that the rush to settle may inadvertently lead to harsher fines than a full-length investigation.

As analyzed through the Pometon case and the Fertilizer precedent, the Turkish appeal ban on settlement texts creates a vacuum of legal certainty. When an administrative authority's decision leads to unequal treatment between competitors based on identical evidence, the inability to seek judicial redress undermines the principle of a fair trial.

Footnotes

1 Please see the original Turkish version of the case.

2 Please note that this represents the final decision for the non-settling parties, while the investigation also involves several parties that have opted for settlement.

3 Please see the original Turkish version of the case.

4 Please see the original Turkish version of the case.

5 Please see the original Turkish version of the case.

6 Aslı Ak, An Analysis on the Necessity of the Appeal Ban in Settlements under Turkish Competition Law: Reflections Inspired by the Fertilizer Case, King's College London, Unpublished Dissertation.

7 Deniz Tanlı, The Settlement in Competition Law. Istanbul Law Review.

8 Betül Özyıldırım Ünlü, The Settlement in Turkish Competition Law, Marmara University, Private Law Institute.

9 The Regulation on Fines to Apply in Cases of Agreements, Concerted Practices and Decisions Limiting Competition and Abuse of Dominant Position was updated and entered into force on the same date with the Official Gazette dated December 27, 2024 and numbered 32765. Please see the English version of the New Regulation via this link.

10 Please see the original Turkish version of the case for Kınık and the case for Beypazarı.

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