Monopoly and Cartel Practices in Turkish Market

In public discourse, “monopoly” and “cartel” are often used interchangeably, but in Competition Law, they are distinct concepts with different legal treatments.

1. Monopoly (Dominant Position)

A monopoly exists when a single firm controls 100% of the market (or a very high share, e.g., >50%, creating a dominant position).

• Is it Illegal? Being a monopoly is NOT illegal in itself. A company can achieve monopoly status through superior innovation, efficiency, or patent protection.
• The Crime: The crime is Abuse of Dominance (Article 6). A monopolist cannot use its power to crush remaining small competitors or exploit consumers (e.g., excessive pricing).
• State Monopolies: Some sectors (like railways or grid management) are “Natural Monopolies” often run or regulated by the state. They are still subject to competition law regarding their commercial activities.

2. Cartel (Article 4)

A cartel exists when independent competitors join forces to behave like a monopoly.

• Is it Illegal? Yes, ALWAYS. Cartels (price-fixing, market sharing, output restriction) are “per se” illegal. There is no defense.
• Structure: Cartels can be loose informal understandings or highly organized secret clubs.

Detecting Cartels

The Competition Authority uses economic screens to detect cartels:

• Prices rising faster than costs.
• Stable market shares over time.
• Identical surcharge announcements.

Conclusion

While you can strive to become a monopoly by being the best (Lawful), you cannot agree with your competitor to act like one (Unlawful Cartel).

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