How Does Turkey’s New Competition Law Affect Mergers and Acquisitions in 2026?

Introduction

Turkey’s business landscape is undergoing a significant transformation with the enactment of its new competition law, effective in 2026. This legislation introduces substantial changes to the regulatory framework governing mergers and acquisitions (M&A). For companies planning to merge or acquire in Turkey, understanding these new rules is critical. This article explores how Turkey’s new competition law affects mergers and acquisitions in 2026, covering key changes, procedural updates, and strategic considerations.

Background of Turkey’s Competition Law Reform

Turkey’s competition law, originally enacted in 1994, has been revised to align with international standards and address modern market dynamics. The new law, officially titled the Law on the Protection of Competition No. 4054, introduces stricter controls on concentrations, increased penalties, and enhanced powers for the Turkish Competition Authority (TCA). These changes aim to foster a more competitive market environment while preventing anti-competitive practices.

Key Changes Affecting Mergers and Acquisitions in 2026

Lowered Notification Thresholds

One of the most impactful changes is the reduction in notification thresholds. Under the new law, transactions must be notified to the TCA if the combined turnover of the parties exceeds a certain limit, which has been lowered significantly. Additionally, the target company’s turnover threshold has also been reduced. This means more M&A deals will require prior approval from the TCA, increasing regulatory scrutiny.

Introduction of a ‘Significant Impediment to Effective Competition’ Test

The new law replaces the previous dominance-based test with a ‘significant impediment to effective competition’ (SIEC) test. This test is broader and allows the TCA to block or condition transactions that may harm competition, even if they do not create a dominant player. This change aligns Turkey with EU competition law and gives the TCA greater discretion in reviewing deals.

Extended Review Timelines

Previously, the TCA had a fixed 30-day review period for Phase I and 90 days for Phase II. The new law introduces a more flexible timeline, with the possibility for the TCA to extend reviews up to 6 months in complex cases. This uncertainty can affect deal timetables and increase transaction costs.

Stricter Penalties for Gun-Jumping

Gun-jumping, or implementing a transaction before obtaining clearance, now carries heftier fines. The new law imposes fines of up to 10% of the parties’ annual turnover for non-compliance. This emphasizes the importance of obtaining clearance before closing.

Procedural Changes in M&A Reviews

Mandatory Pre-Notification Consultations

For large or complex transactions, the TCA now encourages or may require pre-notification consultations. This allows parties to discuss the deal structure and potential issues before formal filing, potentially speeding up the review process.

Simplified Procedure for Low-Risk Deals

To balance the increased burden, the new law introduces a simplified notification procedure for transactions that are unlikely to raise competition concerns. This includes deals where the combined market share is below a certain threshold. These transactions may receive clearance more quickly.

Increased Information Requirements

Notification forms now require more detailed information, including market share data, competitive analysis, and vertical relationships. This demands more thorough preparation from merging parties.

Strategic Implications for Businesses

Early Planning and Due Diligence

Given the lowered thresholds and stricter review, companies should integrate competition law considerations early in the M&A process. Conducting thorough due diligence on competitive overlaps and market positions is essential to identify potential issues.

Timing and Deal Certainty

The extended review timelines mean that deals may take longer to close. Parties should factor in potential delays and include flexibility in transaction agreements, such as long-stop dates and break-up fees.

Risk of Conditions or Prohibitions

Under the SIEC test, the TCA may impose remedies such as divestitures or behavioral commitments. Companies should be prepared to offer remedies to address competition concerns. In some cases, the TCA may prohibit the transaction altogether.

Compliance with Gun-Jumping Rules

Strict penalties for gun-jumping require careful coordination between signing and closing. Parties must avoid any integration steps before clearance, including sharing competitively sensitive information.

Comparison with Previous Law

• Thresholds: Lower combined and target turnover thresholds under new law.
• Substantive Test: SIEC test replaces dominance test.
• Review Timeline: More flexible, up to 6 months for complex cases.
• Penalties: Higher fines for gun-jumping (up to 10% of turnover).
• Procedures: Introduction of pre-notification consultations and simplified procedure.

Industries Most Affected

While all sectors are subject to the new law, industries with high market concentration or frequent M&A activity will be most affected. These include:

• Technology and Digital Markets: The TCA has been particularly active in reviewing tech mergers, and the SIEC test allows for scrutiny of data-driven market power.
• Pharmaceuticals and Healthcare: Mergers in these sectors often raise competition concerns due to patent portfolios and market exclusivity.
• Energy and Utilities: State-owned enterprises and privatizations may face additional scrutiny.
• Retail and Consumer Goods: Consolidation in these markets can lead to buyer power concerns.

Practical Steps for Navigating the New Law

Engage Legal Counsel Early

Given the complexity of the new law, hiring experienced competition lawyers in Turkey is crucial. They can guide you through the notification process and help assess risks.

Conduct a Competition Impact Assessment

Before proceeding with a deal, evaluate the potential competitive effects using the SIEC test framework. Identify any markets where the transaction may significantly impede competition.

Prepare for Remedies

If competition concerns are identified, consider proactive remedies such as divesting overlapping assets or licensing technology to competitors. Offering remedies early can facilitate clearance.

Monitor TCA Enforcement Trends

Stay updated on TCA decisions and guidance to understand how the new law is being applied. This can help predict outcomes for similar transactions.

Conclusion

Turkey’s new competition law fundamentally changes the M&A landscape in 2026. With lower thresholds, a broader substantive test, and stricter penalties, companies must approach mergers and acquisitions with heightened regulatory awareness. By planning early, engaging experts, and understanding the procedural nuances, businesses can navigate these changes successfully. The key is to integrate competition law compliance into the core M&A strategy, turning regulatory challenges into opportunities for smooth deal execution. As the TCA begins enforcing the new law, staying informed and adaptable will be essential for any company looking to merge or acquire in Turkey.