The Political Economy of Regulation in Turkey

The Political Economy of Regulation in Turkey

Preface

Contents

Contributors

Chapter 1: Introduction: Regulation and Competition in Turkey

1.1 Regulatory Governance and Commitment

1.2 Competition or Regulation?

1.3 The Turkish Experience

1.3.1 A General Outlook

1.3.2 Lessons from the Markets

References

Chapter 2: The Place of Regulation Within the Public Law in Turkey

2.1 Introduction

2.2 How Does the Turkish Public Economic Law Perceive the Regulation?

2.3 The Constitutional Framework of the Regulation in Turkey

2.4 The IRA in Turkey

2.4.1 The Appearance of IRA in the Legal Environment

2.4.2 The Reactionary Points of the Conventional Administrative Structure Toward IRA

2.5 Conclusion

References

Chapter 3: The Political Economy of Privatization in Turkey: An Evaluation

3.1 Introduction

3.2 Historical Background

3.2.1 Interventionist State Policy and Establishment of SEEs

3.2.2 Liberal Economic Applications and Privatization Policies

3.3 Privatization Policy in Practice

3.3.1 Institutional and Legal Factors

3.3.2 Economic Factors

3.3.3 Political Factors

3.4 Conclusion

References

Chapter 4: Regulatory Diffusion in Turkey: A Cross-sectoral Assessment

4.1 Introduction

4.2 Varying Perspectives on the Diffusion of Regulatory Reforms

4.3 Regulatory Reforms in Turkey

4.3.1 Competition Authority

4.3.2 The Banking Regulation and Supervision Agency

4.3.3 Information Technology and Communications Authority10

4.3.4 Energy Market Regulatory Authority

4.3.4.1 Regulation of the Electricity Industry

4.3.4.2 Regulation in the Gas Industry

4.3.5 Anomalies in Regulation: Turkish NRAs in Unusual Sectors

4.3.5.1 Sugar Agency

4.3.5.2 Tobacco and Alcohol Market Regulatory Agency

4.4 Conclusion

References

Chapter 5: The Legal Structure of Competition Policy in Turkey

5.1 Introduction

5.2 Background and the Sources of the Antitrust Law

5.3 Main Concepts

5.3.1 Scope of Application

5.3.1.1 Relevant Market

5.3.1.2 Territorial Reach

5.3.1.3 Special Industries

5.3.2 Undertakings and the Associations of Undertakings

5.4 Overview of Substantive Provisions

5.4.1 Restrictive Agreements

5.4.1.1 Collusive Behavior

The Agreement

Concerted Practices

Decisions of Associations of Undertakings

5.4.1.2 Test of Illegality: Restriction of Competition

Horizontal and Vertical Restraints

Per Se Prohibitions and Rule of Reason

Leniency

5.4.1.3 Exemption

5.4.2 Abuse of Dominant Position

5.4.2.1 Dominant Position

5.4.2.2 The Concept of Abuse

Exploitative Abuses

Exclusionary Abuses

Concentrations

The Concept of Concentration

Merger Test: Creating or Strengthening Dominance and Thereby Lessening Competition

Procedural Issues

5.5 Consequences of Violations and Enforcement Institutions

5.5.1 Administrative Enforcement

5.5.1.1 The Turkish Competition Board

Formation and Composition

Investigative Powers

5.5.1.2 Administrative Fines

5.5.1.3 Administrative Injunctions

5.5.1.4 Interim Measures

5.5.2 Civil Enforcement

5.5.2.1 Nullity

5.5.2.2 Damages

5.6 Conclusion

References

Chapter 6: Regulation in the Turkish Electricity Industry

6.1 Introduction

6.2 Reform in the Turkish Electricity Industry

6.2.1 Historical Development of Market Structure

6.2.2 Present Structure of the Turkish Electricity Industry

6.2.3 Current State of Privatization in Distribution Companies

6.3 Regulatory Framework for the Turkish Electricity Industry

6.3.1 Composition and Regulation of End Users’ Tariff

6.3.2 Determination of Revenue Requirements2

6.3.3 Incentive Regulation in Turkish Electricity Distribution

6.3.4 Service Quality Measures

6.3.5 Reward/Penalty Schemes for Service Quality

6.4 An Application of DEA on the Turkish Electricity Distribution Industry

6.4.1 DEA Methodology in a Nutshell

6.4.2 Data, Variables, and Findings

6.5 Conclusion

References

Chapter 7: The Regulation of Natural Gas Industry in Turkey*

7.1 Introduction

7.2 Background to Turkish Natural Gas Market

7.3 General Regulatory Framework in Turkish Natural Gas Market

7.4 Turkish Gas Release Program

7.5 The Auctions in Turkish Gas Distribution Market

7.5.1 Theoretical Foundations

7.5.2 Auctions in Practice

7.6 Turkish Reforms Within EU Framework

7.7 Discussion and Guidelines for Policy Makers

7.8 Conclusion

References

Chapter 8: Regulation and Competition in the Turkish Telecommunications Industry

8.1 Introduction

8.2 General Background and the New Legal Framework

8.3 Developments in Major Segments

8.3.1 Competition and Regulation: Fixed Versus Mobile

8.3.2 Developments in Fixed Telephony

8.3.3 Developments in Broadband

8.3.4 Developments in the Mobile Segment

8.3.4.1 Retail and Wholesale Tariff Controls

8.3.4.2 Mobile Number Portability

8.3.4.3 Mobile Call Termination Rates

8.4 Conclusion

References

Chapter 9: Regulation, Deregulation, and Competition in the Turkish Airline Industry

9.1 Introduction

9.2 Historical Setting

9.2.1 Regulatory Institutions in the Industry

9.2.1.1 DGCA

9.2.1.2 GDSAA

9.2.2 The Relevant International Institutions

9.2.2.1 ICAO

9.2.2.2 EUROCONTROL

9.2.3 Privatization Attempts and the Build-Operate-Transfer Model

9.3 The Pre-2003 Industry Structure

9.3.1 Barriers to Entry

9.3.2 Pricing Policy and Potential Competition

9.4 The Post-2003 Market Structure: Results of Deregulation

9.4.1 Entry and Route Restructure

9.4.2 Other Developments

9.4.3 Quality of Service and Ground Handling

9.4.4 Turkish Airlines as a Monopoly Power in the Industry

9.5 Conclusion

References

Chapter 10: Political Economy of Water Regulation and the Environment in Turkey

10.1 Introduction

10.2 Endowments

10.3 Forces Driving Water Policies

10.4 Institutions and Organizations

10.5 Environmental Laws and Organizations

10.6 Water Consumption and Irrigation Development

10.7 Environmental Effects

10.7.1 Aksehir Gölü

10.7.2 Tuz Gölü

10.7.3 Beysehir Gölü

10.7.4 Seyfe Gölü

10.7.5 Avlan Gölü

10.8 Conclusion

References

Index