RESTRICTED
WORLD TRADE WT/WGTCP/W/40
1October 1997
ORGANIZATION(97-4065)
Original: English Working Group ontheInteraction
between Trade andCompetition Policy
COMMUNICATION FROM TURKEY
Thefollowing communication, dated 16September 1997, hasbeenreceived fromthePermanent
Mission ofTurkey withtherequest thatitbecirculated toMembers.
_______________
Background
TheWorkingGroupontheInteractionbetweenTradeandCompetitionPolicyhasbeenmandated
bytheSingapore Ministerial Declaration. Incompliance withtherelevant partoftheDeclaration the
Working Group willstudy theissues raised byMembers relating totheinteraction between trade and
competition policy, including anti-competitive practices, andidentify anyareas thatmaymerit further
consideration.
Turkey welcomes theestablishment oftheWorking Group. Theissues oftradeandcompetition
arebeing discussed bydifferent international organizations buttheirscope isnotasextensive asthe
onecovered byWTO 'sinvolvement. Turkey firmly believes that,WTO, withitsuniversal membership
canprovide themost balanced response todifferent interests andconcerns ofbothdeveloped and
developing countries.
Introduction
Competition andtradepolicies havetraditionally beendeveloped fordifferent endsandapplied
indifferent ways. While competition policies havebeenprepared atnational levelandaimatgranting
allbusinessentitiesequalchancestoconducttheiractivitiesinnationalmarketsandtoprotectconsumers'
rights, trade policies havebeenusedfordifferent purposes atbothnational andinternational levels.
Major objectives oftrade policy, asreflected inthepreamble oftheWTO Agreement which isthe
cornerstone ofthemultilateral trading system, are"raising ofstandards ofliving, ensuring full
employmentandalargeandsteadilygrowingvolumeofrealincomeandeffectivedemandandexpanding
production andtradeingoods andservices, while allowing foroptimal useoftheworld 'sresources ...."
Competition policy plays akeyroleincreating anenvironment thatisfavourable fortrade.
Theultimate goalofcompetition policy iseconomic efficiency. Andthesuccess ofcompetition policy
depends toalarge extent ontheeffective design ofpolicy andpolicy institutions.
Two developments have characterized international economic activity inrecent decades:
liberalization andglobalization. Although, asmentioned before, trade andcompetition policies are
geared todifferent ends, tradeliberalization andcompetition policies havesimilar economic objectives.
Themainobjective ofcompetition policy isthebalanced andefficient allocation ofresources toachieve
economic growth. Ontheother hand, freetradepolicy focuses mainly ondiminishing customs duties
andnon-tariff barriers.WT/WGTCP/W/40
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Within theframework ofliberalization andglobalization, removal ofanti-competitive practices
restricting market access toforeign competitors andavoidance oftradepolicies affecting international
competition areofgreat significance.
Itisourbelief thattrade andcompetition policies should bemutually supportive andgohand
inhand.
National Experience
InTurkey, theprotection offreecompetition isaconstitutional responsibility fortheState
(Article 67oftheTurkish Constitution).
Within thisframework, LawNo.4054 onthe"Protection ofCompetition" wasadopted by
theParliament of7December 1994 andentered intoforce on13December 1994. Thepurpose set
forthintheLawisto"establish asystem ensuring thenecessary regulation, supervision andprevention
ofabuse ofdominant position byundertakings andagreements, decisions andconcerted practices which
haveastheirobject oreffect, theprevention, restriction ordistortion ofcompetition."
BythisLaw, acompetition authority hasbeenestablished. Thisauthority enjoys administrative
andfinancial autonomy. Ithasalegalpersonality. Itsobjective isestablishing andimproving goods
andservice markets under freeandeffective competition conditions, supervising theenforcement of
therelevant legislation andexercising allother duties attributed toit.
TheCompetition Board isthedecision-making body oftheCompetition Authority. Itis
responsible fortheapplication ofthisLaw. Ithasbeenconstituted byaCouncil ofMinisters 'Decision
published intheTurkish Official Journal No.22918, dated 27February 1997. Thenecessary regulations
anddirectives which willenable theCompetition Board tocarry outitsresponsibilities andduties are
being issued.
Proposals forthefuture work oftheWTO Working Group
Thefirststepofthework programme oftheWorking Group should allow fortheconceptual
understanding ofcompetition andcompetition related issues. Thedefinition ofcompetition andits
scope andcoverage should beclarified attheoutset. Secondly, theinstruments ofcompetition and
itsimpact ontrade should bediscussed. Inaddition thetrade perspective oftheissue, trade policies
andinstruments oncompetition andtheireffects oncompetition should betaken up.
Incarrying outitswork, theWorking Group should alsoclearly define thecoverage ofissues
itwillexamine. Webelieve thatthiswillbeoneofthepre-conditions forthesuccess oftheGroup.
Wepropose thatthescope oftheissues should notbetoobroad toobfuscate ourfocus onsome
fundamental issues. Also, expanding thecoverage oftheWorking Group orcovering some issues
which havealready beendiscussed inother foramayresult induplications andmake itdifficult toreach
aconclusion.
Wefirmly believe thattheWorking Group should carry outitswork insuchawaythatitpaves
thewaytoagreater cooperation among thenational competition authorities oftheMembers.
During theexamination ofnational competition lawsandpolicies, theWorking Group may
findthebasic features andcommon principles ofnational competition rules andprocedures andata
laterstage, theWTO mayplayapioneering roleintheconvergence ofnational competition laws.
Itcanencourage countries thatdonothavecompetition policies toenact suchlegislations inthefield
ofcompetition. Inthisrespect, developing countries require special consideration. TheWorking GroupWT/WGTCP/W/40
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shouldconsiderthemostappropriatemechanismstoinstigatethesecountriestoadoptnationalcompetition
laws. Aninternational framework forcompetition andcompetition related issues could onlybe
establishedbyensuringtheinvolvementofdevelopingcountries.Technicalassistanceshouldbeprovided
tothese countries.