The Block Exemption Regime for Specialisation Agreements Has Been Revised

Introduction

The Turkish Competition Authority (“TCA”) has revised the block exemption regime applicable to specialisation agreements through the publication of the Communiqué on the Block Exemption for Specialisation Agreements (Communiqué No. 2025/2) (“Communiqué”) in the Official Gazette dated 26 June 2025 and numbered 32938. With the entry into force of this new Communiqué, the previous Communiqué No. 2013/3 has been repealed, effective as of the same date.

The block exemption for specialisation agreements constitutes a mechanism under which certain cooperation arrangements—such as the partial or complete discontinuation of the production of specific products by undertakings active in the same product market, or the transfer of such production to other parties—are exempted collectively from the prohibition set forth in Article 4 of the Law No. 4054 on the Protection of Competition (“Law No. 4054”), provided that specific conditions are met. This exemption applies in cases where such arrangements do not significantly restrict competition and contribute to economic efficiency.

Key Amendments Introduced by the New Communiqué

The newly adopted Communiqué introduces several fundamental conceptual and quantitative changes compared to the previous regulation. These changes both redefine the boundaries of the block exemption conditions and affect technical criteria that undertakings should take into consideration in practice.

• Reduction of the market share threshold - The previous threshold, which allowed the block exemption where the parties’ combined market share did not exceed 25% in the relevant markets for the specialisation products, has been lowered to 20%. This tightening reflects a more rigorous approach to competition oversight.
• Introduction of sub-market condition - Where specialisation products are used as indispensable inputs in the production of products offered by the parties in downstream markets, the 20% market share threshold must be satisfied both in the market for the specialisation product and in the downstream market. This ensures that market power in vertical structures is also taken into account.
• Flexibility in market share calculation - As a general rule, the calculation of market share will be based on the sales value of the previous calendar year. However, where such data may be misleading, the average of the previous three calendar years may be used. This flexibility is particularly relevant for sectors experiencing seasonal or cyclical fluctuations.
• Tolerance period for threshold exceedance - If the market share initially remains within the 20% threshold but later exceeds it, the exemption shall remain valid for two additional calendar years following the year in which the threshold was first exceeded. This provision offers an important safeguard for undertakings in phases of rapid growth.

Scope and Limitations of the Exemption

The Communiqué limits the block exemption to specialisation agreements of a specific nature. Pursuant to Article 5 of the Communiqué, the exemption applies to (i) unilateral or reciprocal specialisation agreements concluded between two or more undertakings operating in the same product market, under which certain parties agree to partially or entirely cease the production of specific products while the other parties undertake to assume such production, and (ii) joint production agreements concerning the collaborative manufacture of specific products.

The exemption is not restricted solely to these core arrangements. It may also apply to cases where the parties agree to exclusive purchasing or exclusive supply obligations in respect of the specialisation products, or where the parties engage in joint distribution of such products. Furthermore, ancillary provisions—such as the assignment or licensing of intellectual property rights—that are directly related and necessary for the implementation of such agreements may also fall within the scope of the exemption, provided that they do not constitute the principal object of the agreement.

Conversely, agreements that include any of the following hardcore restrictions listed under Article 6 of the Communiqué shall not benefit from the block exemption:

• Price fixing in sales to third parties,
• Market or customer allocation,
• Limitations on production or sales volumes.

It should be noted, however, that the determination of output volumes is permitted where it forms part of a joint production agreement or where sales targets are defined within the context of joint distribution. Therefore, such restrictions may be considered exemptible only in narrowly defined circumstances.

Transitional Period and Status of Existing Agreements

With the entry into force of the Communiqué, the previous Communiqué No. 2013/3 has been repealed. However, pursuant to the provisional article of the Communiqué, agreements that benefitted from the block exemption under the former regime but do not meet the requirements of the new regulation are granted a two-year transitional period.

During this period, such agreements will not be subject to the prohibition under Article 4 of Law No. 4054. However, agreements that have not been brought into compliance with the Communiqué by the end of the transitional period will no longer be eligible for the block exemption. Accordingly, it is crucial that existing agreements be reviewed in a timely manner and the necessary compliance measures be implemented without delay.

Assessment and Recommendations

The Communiqué redefines the block exemption regime for specialisation agreements both in terms of its scope and implementation conditions. In particular, the reduction of the market share threshold from 25% to 20%, along with the introduction of the sub-market condition, will significantly narrow the range of agreements that can benefit from the exemption automatically. This development necessitates a renewed assessment, especially for large-scale structures or undertakings with vertical integration.

Conversely, the introduction of a three-year averaging method for market share calculation and the two-year validity period granted in case of threshold exceedance provide a balancing mechanism for undertakings operating in fluctuating markets or undergoing growth phases.

The Communiqué requires not only formal but also substantive compliance. Provisions such as exclusive purchasing or supply obligations, joint distribution arrangements, or the transfer of intellectual property rights must strictly conform to the technical requirements of the exemption. Otherwise, an agreement that appears to fall within the scope of the Communiqué may, in practice, be excluded from the benefit of the exemption.

In this context, it is essential for companies to review their existing specialisation agreements before the end of the transitional period and to conduct a compliance assessment for any new agreements to be concluded. Where necessary, considering the alternative of an individual exemption application may be advisable to ensure legal certainty.

For more information on the revised block exemption regime for specialisation agreements under Turkish competition law and its potential implications for your current or future contractual structures, please contact your CMS partner or local CMS experts: Dr. Döne Yalçın and Arcan Kemahlı.