Unfair competition

Scope

According to Article 54 of the Turkish Commercial Code (TTK), the purpose of these provisions is to ensure honest and undistorted competition in the interest of all participants; deceptive conduct and commercial practices that affect relations among competitors or between suppliers and customers, or that are otherwise contrary to the principle of good faith, are unfair and unlawful. TTK Art. 55 lists the main cases: advertising and sales methods contrary to the principle of good faith (such as disparagement, misleading statements and causing confusion with the products or activities of others), inducing a breach or termination of a contract, unauthorized exploitation of the work products of others, unlawful disclosure of manufacturing and business secrets, failure to comply with working conditions, and use of terms of business contrary to the principle of good faith. The list is illustrative; the general criterion is Art. 54.

Practical significance

A person whose economic interests are harmed by unfair competition, or who may face such a danger, may request a declaration of whether the act is unfair, its prevention, the elimination of its consequences, pecuniary damages if there is fault and, if the conditions are met, non-pecuniary damages (TTK Art. 56). These actions, as a rule, become time-barred under the statute of limitations one year after the day on which it was learned that the rights had arisen and in any event three years after they arose; if the act constitutes a crime subject to a longer statute of limitations under the criminal code, that period applies (TTK Art. 60). Those who intentionally commit the acts listed in TTK Art. 55 may also face criminal sanctions upon complaint (TTK Art. 62).

Commonly confused concepts

Unfair competition is confused with competition law. Law No. 4054 on the Protection of Competition prohibits agreements restricting competition, concerted practices and abuse of a dominant position and is enforced by the Competition Authority (Art. 4, 6); the unfair competition provisions, by contrast, protect against conduct contrary to the principle of good faith mainly through private-law actions. Unfair competition is also regarded as a special manifestation of tort in commercial relations; however, fault is not required for claims of declaration and prevention, whereas a claim for damages depends on fault (TTK Art. 56).