ABSTRACT
The purpose of unfair competition provisions regulated in the TCC (as stated in Article 54) is to establish a fair and uncorrupted competition in favour of all participants. In order to protect the competitive order, acts and commercial practices contrary to good faith have been enumerated in the Article 55 as unfair competition cases1. According to Article 62 of the TCC entitled “Acts involving punishment”, intentionally committing one of these acts; intentionally providing false or misleading information about one’s status, products, commercial activities and dealings in order that one’s offers and proposals are given preference to over those of competitors; enticing employees, officers or other workers to reveal their employers’ or customers’ production or commercial secrets; not preventing a punishable act of unfair competition performed by one’s employees, workers or representatives, and/or not having restored the action of the misrepresentation constitute unfair competition. Pursuant to Article 63 of the TCC entitled as “Legal entities’ criminal liability”, in case an act of unfair competition is committed during legal entities’ operations, Article 62 will be applied to the members of the management or the shareholders who act in the name of the legal entity. In addition, same Article also underlines that the security measures for the legal entities may be applied to the legal entities that commit acts of unfair competition.
In this study, we shall dwell on the acts involving unfair competition punishment regulated in Article 62 of the TTC by comparing it to the regulations related to unfair competition crime of the fTCC and examine the elements concerning the crime and punishment.
I. INTRODUCTION
Competition is the essential point of free market economy inasmuch as in a setting where competition is lacking or is being violated by acts contrary to good faith, it is impossible for the prices to arise in demand and supply equilibrium. In this connection, fraudulent acts and unjust commercial practices affecting the relations between providers and customers are wrongful acts and are not approved by the legal order.
While the concept of unfair competition had been defined in Article 56 of the Former Turkish Commercial Code (“fTCC”) No. 6762 as “Unfair competition is the abuse of economic competition in any manner by means of deceitful acts or other acts incompatible with good faith.”, in Article 54 of the Turkish Commercial Code (“TCC”) No. 6762, no definition has been made and instead only the purposes and principles as to prevention of unfair competition have been emphasized. As can be inferred from the definition contained in Article 56 of the fTCC, the notion of unfair competition, in the period of the fTCC, had been grounded on the abuse of economic competition and contrariety to good faith2.
In this study, first of all, a comparison will be made between the provisions of fTCC and TCC in terms of unfair competition, then the crime of unfair competition will be evaluated within the context of these two codes.
II. UNFAIR COMPETITION REGULATIONS
While clauses regarding unfair competition were regulated in Article 56 and following articles of fTCC, they are regulated in the Article 54 of the TCC. While the unfair competition provisions in fTCC were based on the purpose of preventing abuse of rights incompatible with good faith and disruption of economic life in society by abuse of competition (Article 56 of fTCC), the unfair competition provisions in TCC are based on the purpose of establishing a fair and uncorrupted competition in favour of all participants3. However, in both of the regulations, provisions related to unfair competition are extensively dealt with for the purpose of protecting competitors’ subjective rights.
While in fTCC, ten (though not limited to ten) unfair competition cases were mentioned, in TCC twentythree of them are mentioned, in parallel with Swiss Unfair Competition Code. The most important matter here is that unfair competition cases in both fTCC and TCC are enumerated as examples and not in a restrictive manner4.
III. UNFAIR COMPETITION CRIME AS REGULATED IN THE TCC
A. In General
Unfair competition crimes in TCC are considered as commercial crime or economic crime within the context of criminal commercial law5. On the grounds that it is impossible to continue to struggle with unfair competition only through civil liability and that by acts of unfair competition, which is a public expression as well, is disrupted, the legislator has posited penal clauses related to unfair competition in order to establish effective legal protection.
In Article 62 of TCC entitled “Acts involving punishment”, acts constituting the crime of competition have been regulated6. Article 62 of TCC has been formed by updating the wording of Article 64 of fTCC. In addition, the article has been adapted to the New Turkish Penal Code’s system7. Acts constituting unfair competition have been regulated in four paragraphs8.
In paragraph (a) of Article 62 of TCC, acts contained in the Article 55 of TCC have been referred to; in paragraph (b), intentionally providing false or misleading information about one’s status, products, commercial activities and dealings in order that one’s offers and proposals are given preference to over those of competitors; in paragraph (c), enticing employees, officers or other workers to reveal their employers’ or customers’ production or commercial secrets; in paragraph (d), not preventing a punishable act of unfair competition performed by one’s employees, workers or representatives, and/or not having restored the action of the misrepresentation have been posited as crimes.
Particular attention must be paid to the fact that Article 62 of TCC is applicable when the aforementioned acts “do not constitute another crime involving a heavier punishment”. In other words, Article 62 of TCC is a secondary provision9. In case the enumerated acts constitute another crime and this crime involves a heavier punishment compared to Article 62 of TCC, decision is rendered according to that latter crime. Although the act constitutes another crime, if this crime imposes a lighter punishment, then, once again, the crime of unfair competition shall apply.
Acts and commercial practices contrary to good faith have been enumerated in the Article 55 in six paragraphs and in twenty-one acts. However it should be noted that this enumeration is not restrictive and that this method is contrary to ‘the principle of legality of the crimes and punishment’ (‘nullum crimen sine lege’, ‘nulla poena sine lege’), ‘the principle of legal security’, ‘the principle of certainty’ and ‘the principle of predictability’, and at the same time the expression “in particular” is contrary to one of the fundamental principles of criminal law, namely ‘the prohibition of analogy’10. The legislator has stated in his justification of such Article that by virtue of the principle of legality only the acts enumerated following the expression “in particular” contained in Article 55 of TCC are to be punished11.
But in doctrinal studies, it is stated that even though the conclusion arrived at is appropriate, the method is erroneous since the justifications of article are means of interpretation, having no binding force with regards to the text of the relevant article12.
It is also controversial in doctrinal studies whether the acts contained in Article 55 of TCC (applied as a consequence of their being referred to in Article 62 of TCC) are alternative acts or constitute separate crimes. From one point of view, all the acts enumerated in Article 55 of TCC are alternative act13. Another point of view, however, asserts that the acts enumerated in Article 55 of TCC are alternative acts, that two crimes in the form of “giving advertisement contrary to good faith” and “using sale methods contrary to good faith principles” constitute, together with the acts enumerated in twelve paragraphs, three different crimes14. A third point of view considers that, given that if the subject-matter of the acts are the same, there is a crime with alternative acts, that these acts are the alternative acts for the same crime, every paragraph constitutes a separate crime, in so far as the acts contained in Article 55 of TCC under the heading “Acts and Commercial Practices Contrary to Good Faith” are related to different subjects and in so far as even the offender and the victims of some of them are different15.
In our opinion, acts that have been regulated in the article 62 in four paragraphs and that comprise the six paragraphs of the article 55 are alternative acts for the unfair competition crime. For this reason, once one of these acts is committed, the crime will be constituted and in case more than one of them are committed, no plurality of crimes will be resulted in.
Whereas not all but a part of the unfair competition cases stated as examples in the article 57 of the fTCC were regulated as crimes and also some other unfair competition cases that were not stated in these articles were comprised in the crime, all the acts stated in the article 55 of the TCC as examples have been provided as crimes. Likewise, in the article 62 of the TTC, three separate acts that have not been regulated in article 55 have been comprised in criminal acts. In fact, the acts in paragraph 1-b of the article 62 of TTC and the acts in paragraph 1-a2 of the article 55 of TTC, also, the acts in paragraph 1-c of the article 62 of TTC and the acts in paragraph 1-b-3 of the article 55 of TTC are the same. Accordingly, the same acts are regulated under the same title more than once16.
B. Protected Legal Value
It can be emphasized that the honest competition environment, the commercial reputation and dignity of the competitors who have suffered by unethical practices, the rights of the consumers and customers are protected with the unfair competition crime, thus it is a type of crime having multiple subjects17.
C. Elements of The Unfair Competition Crime
(i) Legal Element
The legal element of the crime is the article itself.
(ii) Material Element-Subject
Unfair competition is the fraudulent exploitation of the economic competition in contravention of the principle of honesty. From this definition, it can be said that the subject of the crime of unfair competition is constituted by the economic order in which honest competition prevails in general18.
(iii) Wrongdoer
As it is enacted in TCC, the wrongdoer of the unfair competition crime can be anyone19. Since legal entities do not have the ability to act voluntarily, it is impossible for them to be a wrongdoer. In other words, only real persons can be the wrongdoer of a crime. Likewise, in Turkish criminal law, it is stated that the legal entities cannot be wrongdoers, and the acknowledgement of criminal responsibilities for them will constitute a contradiction to the principle of individual criminal responsibility.
In case of committing a crime on behalf of the trading companies during its activities, the criminal responsibility of the authorized body of the legal entity or its representative shall be taken into consideration. If the authorized body has made a decision on the board, the members who have made a positive vote will be responsible; the members who have not attended the meeting or who have attended but made a negative vote will not be held responsible. However, it is possible to say that if the obligation of the members to prevent the decision to be taken is stated in the Law or in the articles of association, the members who do not prevent the decision to be taken have negligently participated in the crime20. In addition, it is also possible to delegate the duties among the members of the representative body in the articles of association. In presence of the delegation of duties, each member shall be responsible in proportion of the representation given to him and the members who know the details of the action or transaction and who have a role in the formation of the crime shall have the criminal responsibility.
While the legal liability of the press is regulated in the Article 58 of TCC, there is no regulation regarding the criminal liability of those who have legal liability in the case that the crime of unfair competition is committed through the press. It is stated in the doctrine that the press may have the criminal liability21. At this point, the provisions of Press Law No. 5187 will be used. As a matter of fact, in the decision of the Supreme Court of Appeals 7th CD, T.2.10.1997, E.1997 / 5449, K.1997 / 7333, it was decided that the responsible director accused of unfair competition should be decided to be punished22. In the event that the crime of unfair competition is committed through the press, the person who writes, translates or makes an official or caricature the article constituting the contents of the periodical or indefinite period that constitutes a crime of unfair competition may be punished in accordance with the Article 62 of TCC23.
(iv) Victim
Everyone who constitutes the society is a victim of the crime of unfair competition in the broad sense. In the narrow sense, the legal entities, consumers and customers who have suffered by dishonorable actions and practices are the victims of the crime24.
(v) Movement, Conclusion and Lien of Causality
In paragraph (a) of the Article 62 of the TTC, acts contained in the article 55 have been referred to; in paragraph (b), intentionally providing false or misleading information about one’s status, products, commercial activities and dealings in order that one’s offers and proposals are given preference to over those of competitors; in paragraph (c), enticing employees, officers or other workers to reveal their employers’ or customers’ production or commercial secrets; in paragraph (d), not preventing a punishable act of unfair competition performed by one’s employees, workers or representatives, and/or not having restored the action of the misrepresentation have been posited as crimes.
The unfair competition is classified under six paragraph and each paragraph is given as an example of mentioned unfair competition. In the first paragraph, contrary to the rules of honesty, advertisements and sales methods and other unlawful acts, to direct or to terminate the contract in paragraph (b), to take advantage of the unauthorized use of the business products of others in paragraph (c), to disclose production and business secrets unlawfully in paragraph (d), to not comply with the business conditions in paragraph (e), to use the terms of transaction that is not in accordance with the rules of honesty in paragraph (f ) is shown as an act that constitutes the unfair competition. It should be noted that the count in the Article 55 of TCC is not limited.
It is mentioned above that the movements in the Article 55, which are applied by the Article 62 (paragraph 1-a) of TCC are controversial, whether they are optional movements or separate crimes. Unfair competition crimes are adjacent to the movement, in other words, they are inconclusive crimes. It is accepted that the competition is disrupted and the crime is concluded by the movements mentioned in the Article 62 of TCC25.
(vi) Causes of Crime
Causes of crime are the elements that mitigate or aggravate the punishment. They require the crime to be considered heavier or lighter and consequently to be increased and reduced. When the provisions 62 and 55 of TCC are considered, there are no causes for the crime. For this reason, the causes which are included in the general provisions of the Turkish Penal Code (“TPC”) and which apply to all crimes shall be applied.
(vii) Moral Element
In order for the wrongdoer to be held responsible, it is not enough to carry out the action prohibited in the criminal norms, but also a spiritual connection is needed between the action and the wrongdoer26. When the provisions 62 and 55 of TCC are examined, it can be stated that the general intent is sufficient for the crime to be committed and if the actions that constitute a crime are taken by negligence, the crime cannot be committed27. However, in the doctrine, it is also stated that in some cases listed in Articles 55 and 62 of TCC, it is necessary to act with a specific motive beside the intent and Article 55 paragraph 1-a-3, paragraph 5, paragraph 1-b-1, paragraph 1-b-2, Article 62 paragraph 1-b and paragraph 1-c of TCC are required to be taken into consideration28.
(viii) Illegal Element
In order for an act to constitute a crime, it must be a violation of the law, in addition to being a misconduct. Actions that constitute a crime as a rule are illegal29. The reasons for the compliance with the law regulated in TPC are the provision of law, legitimate defense, state of necessity, the exercise of the right and the consent of the person concerned. The reasons for compliance with the general law will also be applied in terms of the crime of unfair competition to the extent that it is appropriate. In the doctrine, the provision of law, the legitimate defense and the state of necessity reasons cannot be applied in regard to this crime, but the exercise of the right and the consent of the person concerned can be applied as a reason of compliance with law30.
(ix) Specific Types of Crime
When the Articles 55 and 62 are examined, it is seen that the movements have been completed by taking action (i.e. giving information or cheating) in some actions, as in Article 62 paragraph 1-b and paragraph 1-c of TCC. In these cases, the attempt will not be possible because the movement is adjacent to the consequence31. The movement can only be mentioned as long as it is divisible32. In Article 62 paragraph 1-d of TCC, it is stated that the result is not adjacent to the movement, there is a reasonable period of time in order to not prevent or not to correct it after learning, and therefore the crime in this paragraph is appropriate for the attempt33. In addition, it is stated that it is possible to attempt in the event that the act of ’deterioration’, which is regulated in Article 55 of TCC and which is considered as a crime under Article 62 paragraph 1, is committed through some means34. In terms of fTCC, the act of the person who is captured by putting the goods on sale that leads to confusion without offering to the sale would remain at the attempted stage (Article 57 paragraph 5 of fTCC), likewise, it was accepted that the act of the person who is captured after publishing the brochures deteriorating someone else’s commodity and work crops in order to distribute could be considered as an attempt (Article 57 paragraph 1 of fTCC)35.
In addition, unfair competition crimes are the crimes that can be committed as an accessory to a criminal act and the provisions of the Turkish Penal Code will be applied in this case36.
If a person violates the criminal code more than once, and therefore is responsible for more than one crime, there is joinder of crimes37. There is no special provision concerning the joinder of crimes in unfair competition crimes. Therefore, the general provisions on the joinder of crimes also apply to unfair competition crimes. However, there is also the opinion that a special conviction was imposed in terms of unfair competition crimes. The basis of this view is the last sentence of the Article 62 of TCC; “If the act does not constitute another crime requiring more severe penalties, upon the complaint of one of the persons who have the right to open the civil proceedings under Article 56, they shall be punished with imprisonment or judicial fine for up to two years due to the acts falling under each paragraph”38.
(x) Enforcement
First of all, it should be noted that, in the event of unfair competition, the wrongdoer has the legal responsibility as well as the criminal liability. (Article 56, 57 and 58 of TCC)
It is clearly regulated in the Article 20 of TPC that the legal entities cannot be the wrongdoer of the crime, but in accordance with the Article 63 of TCC, security measures (cancellation of the permission or confiscation) may be imposed on legal entities. Herein, the private legal entities are mentioned, not the public legal entities and the security measures shall not be applied to the public legal entities39.
In fTCC, the punishment for natural person was an imprisonment from one month to one year, or a heavy fine from five hundred Turkish liras to ten thousand Turkish liras, and the judge could rule on both40. The punishment stipulated in the TCC is an imprisonment up to two years or a judicial fine, and the judge shall be able to rule only one. However, there is no indication of the lower limit. For this reason, the lower limit shall be accepted as one month imprisonment according to the Article 49.1 of TPC41. In addition, since the lower and upper limits are not regulated in TCC, the provision 52.1 of TPC shall be applied, in which case the lower limit of the judicial fine shall be considered as one month and the upper limit shall be considered as two years42.
If an act of unfair competition is dealt with while the businesses of legal entities are conducting, legal entity shall be liable for several fines and expenses together with the partners or the partners who have acted or have been required to act on behalf of the legal entity43. In the case of which provision shall be applied on the unfair competition crimes committed at the time of the fTCC, the solution shall be based on the principle of the application of the law in favor of the amendment44.
(xi) Investigation and Prosecution
It is foreseen that the crime of unfair competition in Article 62 of TCC will be investigated and prosecuted “upon the complaint of one of those who have the right to open the civil case under the article 56 of TCC.” Persons who can file a civil lawsuit in the Article 56 of TCC are; anyone who has suffered or is at risk of harm to their customers, credits, professional reputation, commercial activities or other economic interests due to the unfair competition, customers whose economic interests are suffered or may face such risks, chambers of commerce and industry, chambers of artisans, stock exchanges, and other professional and economic associations which are authorized to protect the economic interests of their members according to their statutes45.
Any special complaint period for unfair competition crimes is not envisaged in TCC, so that the general provision of the Article 73 of TPC shall apply and the person entitled to complain must make a complaint within six months of the date on which the act of unfair competition has been committed and who is the wrongdoer46.
In TCC, a situation requiring ex officio prosecution in regard to unfair competition crimes is not regulated. However, in the Article 64 (last paragraph) of fTCC, it was provided that ex officio investigation could be made exceptionally. This situation is stated as; “despite the restraining of unjust competition order, the person who continues with unjust competition with the same or subordinate changes, shall be sentenced to imprisonment of not more than six months, and shall be sentenced to heavy fine from five thousand liras to ten thousand liras, and the wrongdoer shall be followed ex officio.”47. This crime is not included in the TCC.
The competent court is the criminal court of peace and in accordance with TPC and the Code of Criminal Procedure (“CCP”), the authorized court is the court where the crime was committed.
IV. CONCLUSION
As is seen, the crime of unfair competition is one of the commercial crimes and constitutes a special norm of economic crime. Nevertheless, it is seen that the principle of legality (‘nullum crimen sine lege’, ‘nulla poena sine lege’), the principle of legal security, the principle of certainty and the principle of predictability are not respected because cases constituting crime have not been enumerated restrictively and crimes have been stated by use of analogy in the relevant article. In this case, other acts even though they are not enumerated in the code may be considered as crime to the extent that their nature is alike. Though the legislator in its justification has stated that the acts enumerated following the expression “in particular” contained are to be punished, the appropriateness of this method will be open to discussion since the justifications of article are texts to have resort to for interpretation and are not as binding as the text of the code.
On the other hand, it can be admitted that the crimes of unfair competition as regulated in fTCC and in TCC do not comprise much difference, that in the TCC the wording of the fTCC has been simplified and that TCC has been adapted to Turkish Criminal Code provisions.
BIBLIOGRAPHY
Sabih Arkan, Ticarî İşletme Hukuku, 18. Edition, Ankara 2013.
Çetin Arslan / Didar Özdemir, Türk Ticaret Kanunu’nda Haksız Rekabet Suçu, International Conference on Eurasian Economies 2016 (https://www.avekon.org/papers/1535.pdf).
Hüseyin Aydın, Türk Ticaret Kanunu’nda Haksız Rekabet Suçları, Doktora Tezi, Ankara 2008.
Serhan Dinç, Türk Ticaret Kanununa Göre Haksız Rekabet Halleri ve Buna İlişkin Davalar, 2017.
Engin Erdil, Haksız Rekabet Hukuku, İstanbul 2012.
Yavuz Erdoğan, Yeni Türk Ticaret Kanunu’nda Haksız Rekabet Suçu, İpek Yolu Canlanıyor, Türk-Çin Hukuk Zirvesi, Adalet Yayınevi, April 2013.
Rezzan İtişgen, Türk Ticaret Kanununda Düzenlenen Gerçek Dışı veya Yanıltıcı Açıklamada Bulunma Suçu, TBB Dergisi 2016 (122).
Hamdi Yasaman / Reha Poroy, Ticari İşletme Hukuku, 14. Edition, İstanbul 2012.
FOOTNOTE
1 Arslan, Çetin / Özdemir, Didar, Türk Ticaret Kanunu’nda Haksız Rekabet Suçu, International Conference on Eurasian Economies 2016, p. 268 (https://www.avekon.org/papers/1535.pdf).
2 Erdoğan, Yavuz, Yeni Türk Ticaret Kanunu’nda Haksız Rekabet Suçu, İpek Yolu Canlanıyor, Türk-Çin Hukuk Zirvesi, Adalet Yayınevi, April 2013, p. 423.
3 Yasaman, Hamdi / Poroy, Reha, Ticari İşletme Hukuku, 14. Edition, İstanbul 2012, p. 311; Arkan, Sabih, Ticarî İşletme Hukuku, 18. Edition, Ankara 2013, p. 316-317.
4 Yasaman / Poroy, p. 311; Arkan, p. 317.
5 Erdil, Engin, Haksız Rekabet Hukuku, İstanbul 2012, p. 455.
6 Dinç, Serhan, Türk Ticaret Kanununa Göre Haksız Rekabet Halleri ve Buna İlişkin Davalar, 2017, p. 144.
7 Erdil, p. 455.
8 Yasaman / Poroy, p. 355; Arslan / Özdemir, p. 269.
9 İtişgen, Rezzan, Türk Ticaret Kanununda Düzenlenen Gerçek Dışı veya Yanıltıcı Açıklamada Bulunma Suçu, TBB Dergisi 2016 (122), p. 363.
10 Arslan / Özdemir, p. 269; İtişgen, p. 339; Erdoğan, p. 459.
11 “Article 62 – The article has been formed by updating the wording of Article 64 of fTCC no. 6762. In addition, the article has been adapted to the New Turkish Penal Code’s system. In paragraph (a) of the article 62 of the TTC, punishment is provided for those who commit intentionally the unfair competition acts contained in article 55. But, it must be stated that, by virtue of the principle of legality, only the acts enumerated following the expression “in particular” contained in the article 55 are to be punished and that those cases that are not enumerated in the article but may constitute wrongful act are not to be punished.”
12 İtişgen, p. 339.
13 Aydın, Hüseyin, Türk Ticaret Kanunu’nda Haksız Rekabet Suçları, Doktora Tezi, Ankara 2008, p. 139-140; Arslan / Özdemir, p. 270.
14 Erdoğan, p. 443.
15 İtişgen, p. 338-339.
16 Erdil, p. 455-456; İtişgen, p. 340
17 Arslan / Özdemir, p. 269.
18 Arslan / Özdemir, p. 269.
19 Erdil, p. 456; Erdoğan, p. 444.
20 Arslan / Özdemir, p. 270.
21 Erdoğan, p. 444-445; Erdil, p. 459-460.
22 Erdoğan, p. 445.
23 Aydın, p. 68; Erdoğan, p. 445.
24 Arslan / Özdemir, p. 270; Erdoğan, p. 446.
25 Arslan / Özdemir, p. 270.
26 Erdoğan, p. 447-448.
27 Erdoğan, p. 448; Arslan / Özdemir, p. 270-271.
28 Erdoğan, p. 448.
29 Arslan / Özdemir, p. 271.
30 Aydın, p. 91; Erdoğan, p. 449-450; Arslan / Özdemir, p. 271; İtişgen, p. 360; Erdil, p. 472-475.
31 Erdoğan, p. 450.
32 İtişgen, p. 362.
33 Erdoğan, p. 450.
34 Erdil, p. 478.
35 Aydın, p. 103.
36 Erdil, p. 478; Erdoğan, p. 450; İtişgen, p. 362; Aydın, p. 105.
37 Aydın, p. 106.
38 İtişgen, p. 362-363.
39 Erdoğan, p. 452.
40 Erdil, p. 480.
41İtişgen, p. 364; Erdoğan, p. 452; Arslan / Özdemir, p. 271.
42 İtişgen, p. 364.
43 Erdil, p. 480.
44 Erdoğan, p. 453.
45 Arslan / Özdemir, p. 271; Erdoğan, p. 454-455.
46 Erdoğan, p. 455; Erdil, p. 476; Arslan / Özdemir, p. 271.
47 Erdoğan, p. 456; Erdil, p. 475.
