CONTENTS  
 
TOPICS       Article   Page  
           No                    No 
 
Purpose           1     1 
  
Scope            2     1 
 
Definitions           3     2 
 
Limitations Rendering Agreements Not  
Caught By Block Exemption         4     4 
  
Non-Compete Obligat ion        5     6 
  
Revocation of Exemption         6     7 
 
Application of the Communiqué to  
Concerted Practices           7     8 
 
Implementation of Article 6 of the Act        8     8 
 
Notification           9     8 
 
Communiqués Abolished         10     8 
 
Temporary Article - 1          8 
   
Entry Into Force          11     9 
 
Execution           12     9 
 
 
 COMPETITION  1   Block Exemption Communiqué on Vertical Agreements  
Communiqué No: 2002/2  
 
Purpose  
 
Article 1 - The purpose of this Communiqué is to determine the conditio ns 
for exempting in block vertical agreements, from the application of the provisions 
of article 4 of the Act on the Protection of Competition dated 7.12.1994 and 
numbered 4054.  
 
Scope  
 
Article 2 - Provided that they bear the conditions mentioned in this 
Communiqué, agreements concluded between two or more undertakings 
operating at different levels of the production or distribution chain, with the aim of 
purchase, sale or resale of particular goods or services -vertical agreements - are 
exempted in block fro m the prohibition in article 4 of the Act, based on article 5 
paragraph three of the Act.  
 
 Vertical agreements which involve provisions related to the transfer of 
intellectual rights to the purchaser, or their use by the purchaser, together with 
the regul ations about the purchase, sale or resale of goods or services shall also 
benefit from the block exemption provided for in this Communiqué, on condition 
that the said intellectual rights directly concern the use, sale or resale, by the 
purchaser or the cus tomers of the purchaser, of the goods or services which form 
the substantial subject of the agreement, and that the transfer or use of such 
intellectual rights does not constitute the main purpose of the agreement. 
However, with regard to the goods or serv ices which are the subject of the 
agreement, this exemption shall be applicable provided that the provisions on the 
said rights do not involve limitations of competition the purposes or effects of 
which are the same with vertical limitations not exempted v ia this Communiqué.  COMPETITION  2    Vertical agreements concluded between competing undertakings may not 
benefit from the exemption granted by this Communiqué. However, those vertical 
agreements where the provider is both the producer and distributor of the goods 
which a re the subject of the agreement, and where the purchaser is not the 
producer but the distributor of the goods which compete with these goods shall 
benefit from the block exemption granted by this Communiqué.  
 
 This Communiqué shall not be applied to vertic al agreements which fall 
under another block exemption communiqué.  
  
  Definitions  
 
 Article 3 - For purposes of the application of this Communiqué, defined 
below are certain terms which take place in the Communiqué:  
 
a) Act: It expresses the Act on the Pr otection of Competition No. 4054.  
 
b) In terms of a vertical agreement;  
 
 1) Provider  expresses the undertaking which is party to the agreement, 
and which sells to the purchaser the goods or services which are the subject of 
the agreement,  
 
 2) Purchaser  expresses the undertaking which is party to the agreement, 
and which purchases goods or services from the provider, including undertakings 
which sell goods or services in the account of an undertaking,  
 
3) Customer  expresses the one who is not party to the agreement, and 
who purchases goods or services from the purchaser or provider.  
 COMPETITION  3    c) Competing Undertakings:  They are providers operating or having the 
potential to operate in the same product market. Product market covers the 
goods or services which are th e subject of the agreement, and the goods or 
services considered, in terms of the purchaser, to be interchangeable with or 
substitutable for them as to their product characteristics, prices and intended 
uses.  
  
 d) Non -Compete Obligation:  It is any kind of  direct or indirect obligation 
preventing the purchaser from producing, purchasing, selling or reselling goods 
or services which compete with the goods or services which are the subject of 
the agreement. Furthermore, taking as the basis the purchases of th e purchaser 
in the previous calendar year, any obligation imposed on the purchaser directly 
or indirectly that more than 80 % of the goods or services in the relevant market, 
which are the subject of the agreement, or that of the goods or services 
substitu ting for them be purchased from the provider or from another undertaking 
to be designated by the provider is also considered as non -compete obligation.  
 
 e) Intellectual Rights:  They express industrial rights, rights of the owner 
of the work, and neighbour ing rights.         
 
 f) Know -how:  It means the package of information which has been 
obtained by the provider as a result of its experiences and experiments, and 
which is not patented, is practice -oriented, confidential, essential and designated. 
In this definition,  
 
 1) The concept of "confidential"  expresses that know -how is not known 
or readily accessible by everyone as a whole, or even when its parts are 
completely gathered and combined,  
 COMPETITION  4    2) The concept of "essential"  expresses that know -how involves 
indispensable information for the purchaser in terms of the use, sale or resale of  
the goods or services which are the subject of the agreement,  
 
3) The concept of "designated"  expresses that know -how has been 
defined in an adequately comprehensive and de tailed manner so as to be able to 
verify that it bears the conditions of being confidential and essential.  
 
 g) Selective Distribution System:  It means a distribution system 
whereby the provider undertakes to sell directly or indirectly, the goods or 
servi ces which are the subject of the agreement, only to distributors selected by 
it, based on designated criteria, and whereby such distributors undertake not to 
sell the goods or services in question to unauthorized distributors.   
 
 For purposes of the appli cation of this Communiqué, the concepts of 
"undertaking", "provider" and "purchaser" also cover their affiliated undertakings. 
In determining an affiliated undertaking, provisions that take place in article 4 
paragraph two of the Communiqué No. 1997/1 Conc erning the Mergers and 
Acquisitions Calling for the Authorization of the Competition Board are taken as 
the basis.  
 
Limitations Rendering Agreements Not Caught By Block Exemption  
 
Article 4 - Vertical agreements which involve limitations that are listed 
below and whose goal is to hinder competition directly or indirectly may not 
benefit from the exemption granted by this Communiqué.  
  
 a) Preventing the purchaser from determining its own selling price. It is to 
such an extent that the provider may determine  the maximum selling price or 
recommend the selling price, on condition that it does not transform into a fixed COMPETITION  5   or minimum selling price as a result of the pressure or encouragement by any of 
the parties.  
 
 b) Introduction of restrictions in relation to re gions or customers where or 
to whom the goods or services which are the subject of the contract shall be sold 
by the purchaser, other than the following cases.  
 
 1) Provided that it does not cover the sales to be made by customers of 
the purchaser, restric tion, by the provider, of active sales to an exclusive region 
or exclusive group of customers assigned to it or to a purchaser,  
 
 2) Restriction of sales of the purchaser operating at the wholesaler level in 
relation to end users,  
 
 3) Restriction of the performance of sale by the members of a selective 
distribution system to unauthorized distributors,  
 
 4) In case there exist parts supplied with a view to combining them, 
restriction of the purchaser's selling them to competitors of the provider who 
holds the position of a producer.  
 
 c) In the selective distribution system, restriction of active or passive sales 
to end users, to be performed by the system members operating at the retail 
level, provided that the right is reserved as to the prohibition for a  system 
member against operating in a place where he is not authorized.  
 
 d) In the selective distribution system, prevention of purchase and sale 
between the system members themselves.  
  
 e) In case there exist goods formed by combining parts, prohibition  for the 
provider against selling such parts as spare parts to end users, or repairers not COMPETITION  6   authorized by the purchaser for the maintenance or repair of goods, in 
agreements between the provider who sells such parts and the purchaser who 
combines them.  
 
 Non-Compete Obligation  
  
 Article 5 - The exemption granted by this Communiqué shall not be 
applicable to obligations in the agreement, which are mentioned below.  
 
 a) Non-compete obligation imposed on the purchaser, which is for an 
indefinite period or whose  duration exceeds five years.  
 
However, in case a part of the investment total required for enabling the 
purchaser to realize its activity based on the agreement is covered by the 
provider on condition that it is not less than 35 %, the duration of non -compete 
obligation to be introduced on the purchaser may be until ten years on condition 
that the part exceeding five years is only limited to the activity to be conducted in 
the facility where this investment has been made. In case of agreeing that the 
non-compete obligation may be implicitly renewed in a way to exceed the 
durations mentioned in this paragraph, the non -compete obligation shall be 
deemed for an indefinite period.  
 
Should the ownership of the facility to be used by the purchaser while 
continuin g its activities based on the agreement belongs to the provider together 
with the land or under a right to build over, which has been secured from third 
persons not connected with the purchaser, or should the purchaser shall 
continue this activity of it in  a facility which is the subject of a real or personal 
right of use obtained by the provider from third persons not connected with the 
purchaser, the non -compete obligation imposed on the purchaser may be tied to 
the duration of use of the said facility by  the purchaser; it is to such an extent that 
the non -compete obligation merely encompasses the activity of the purchaser to COMPETITION  7   be conducted by it in the said facility, in terms of the part of this duration 
exceeding five years.  
 
b) With regard to the period f ollowing the expiry of the agreement, any 
direct or indirect obligation imposed on the purchaser, prohibiting it from 
producing, purchasing, selling or reselling goods or services.  
 
But, a non -compete obligation may be imposed on the purchaser provided 
that it does not exceed one year as of the expiry of the agreement, with the 
conditions that the prohibition relates to goods and services in competition with 
the goods or services which are the subject of the agreement, it is limited to the 
facility or land where the purchaser operates during the agreement, and it is 
compulsory for protecting the know -how transferred by the provider to the 
purchaser.  
 
c) Obligation imposed on the members of the selective distribution system 
not to sell the branded products of  designated competing providers.  
 
 Revocation of Exemption  
 
 Article 6 - In case it is established that an agreement granted exemption 
by this Communiqué has effects incompatible with the conditions provided in 
article 5 of the Act, the Competition Board ma y revoke such exemption granted 
to the agreement by this Communiqué, based on article 13 of the Act. In this 
case, the Competition Board asks for the written and/or oral opinions of parties 
before making its final decision.  
 
 In case parallel networks comp rised of vertical limitations of similar nature 
cover a significant part of the relevant market, the Competition Board may, via a 
Communiqué to be issued by it separately, exclude agreements involving certain COMPETITION  8   limitations in the relevant market, from the ex emption ensured by this 
Communiqué.  
 
Application of the Communiqué to Concerted Practices  
 
 Article 7 - This Communiqué shall also be applicable to concerted 
practices between undertakings, which fall under article 2.  
 
 Implementation of article 6 of the A ct 
 
 Article 8 - Exemption granted pursuant to the provisions of this  
Communiqué shall not prevent the implementation of article 6 of the Act.  
 
 Notification  
 
 Article 9 - It is not compulsory to notify to the Competition Board those 
vertical agreements whic h bear exemption conditions provided for by this 
Communiqué.  
 
 Communiqués Abolished  
  
 Article 10 - The Block Exemption Communiqué on Exclusive Distribution 
Agreements No. 1997/3, the Block Exemption Communiqué on Exclusive 
Purchasing Agreements No. 1997/4 , and the Block Exemption Communiqué on 
Franchise Agreements No. 1998/7  shall be abolished with the entry into force of 
this Communiqué.  
  
Temporary Article 1 - With regard to the agreements which have been 
benefitting, on the date of entry into force of t his Communiqué, from the block 
exemption provided by the Communiqués No. 1997/3, 1997/4 and 1998/7, but 
which do not have the conditions to benefit from the block exemption provided for COMPETITION  9   in this Communiqué, in order for them to be able to benefit from the e xemption 
granted by this Communiqué, they are required, within one year as of the date of 
entry into force of this Communiqué, to be amended in a way to meet the 
conditions provided for by this Communiqué. During this period, the prohibition 
provided for i n article 4 of the Act No. 4054 shall not be applicable to the 
agreements referred to.  
 
Entry Into Force  
 
 Article 11 - This Communiqué shall enter into force on the date it is 
published.  
 
Execution  
  
 Article 12 - The provisions of this  Communiqué shall be  executed by the 
President of the Competition Authority.  
 
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