Abuse of a Superior Bargaining Position: The Japanese Antimonopoly Law’s Supply-Chain Approach and Its Adaptability to Turkish Law

A. The place of the provision and its historical development

The Japanese Antimonopoly Act treats unilateral conduct under two separate categories. The first is “private monopolization” (shiteki dokusen), regulated in Article 3 and requiring a substantial restraint of competition. The second is “unfair trade practices” (fukōsei na torihiki hōhō), prohibited by Article 19 and defined in Article 2(9). Abuse of a superior bargaining position belongs to the second category. That choice is not accidental, and it determines the character of the rule: the legislature chose to conceive the conduct through fairness in the commercial relationship, not through harm to the structure of competition.

Until 2009 the provision stood not in the Act itself but in the JFTC’s general designation (ippan shitei). The 2009 amendment moved abuse of a superior position into the statute as Article 2(9)(v) and, from 1 January 2010, attached an administrative surcharge (kachōkin). The amendment had two consequences. The first is a heavier sanction: for other types of unfair trade practice a surcharge is available only in the case of repetition, whereas for abuse of a superior position a surcharge may be imposed on a first infringement. The second, and less noticed, consequence is that the base of the surcharge is tied not to the size of the market on which the infringement occurred but to the volume of transactions with the counterparty that suffered it. That confirms, at the level of the sanction, the relationship-based rather than market-based character of the rule.

A heavier sanction inevitably brought with it a demand for certainty. On 30 November 2010 the JFTC published the “Guidelines Concerning Abuse of a Superior Bargaining Position under the Antimonopoly Act”, and there gave concrete form to the elements of the provision and to the typical forms of infringement.

B. The elements

The Guidelines and settled practice distinguish three elements of the infringement.

The first element is the existence of a superior bargaining position. This is the most original point of the provision and, for comparative law, the principal object of inquiry. Superiority does not require dominance on the relevant market; the test is the dependence of the counterparty (B) on the first undertaking (A). If B cannot refuse A’s disadvantageous demands because the cessation of the commercial relationship would seriously disrupt B’s business, A is taken to be in a superior position. The assessment looks together at the degree of B’s transactional dependence on A, A’s position on the market, B’s possibility of changing its trading partner, and the necessity, for B, of dealing with A.

Doctrine has expressly accepted that this element can exist independently of market power. A superior bargaining position means either market power or relative superiority vis-à-vis a particular trading partner, and JFTC practice includes cases in which the infringer was not even among the leading firms on the relevant market.

The second element is the use of that position. The mere existence of superiority is not enough; the undertaking must exploit it by making a demand of the counterparty or by imposing an obligation. In JFTC practice this element is established by indicia such as notice that retaliation will follow if the demand is refused, actual retaliation in the past, or the counterparty’s knowledge that other suppliers have been treated in the same way.

The third element is unfairness contrary to normal business practice. The Guidelines list, by way of illustration, the conduct that constitutes an infringement: forcing the purchase of goods or services that the other party does not wish to buy; demanding an economic benefit without consideration (under names such as a participation fee or a listing fee); unilaterally imposing return conditions; unilaterally reducing the price after the event; and having the counterparty’s staff work without payment. It should be stressed that the measure of “normal business practice” refers not to what has in fact become settled in the sector, but to what is acceptable from the standpoint of a fair competitive order. Otherwise a widespread practice of abuse would legitimate itself.

C. Enforcement practice and sanctions

The enforcement history of the provision has been written largely through the retail sector. Between 2006 and 2010, the Valor, Eco’s, Yamada Denki and Royal Home Center decisions found that large retail chains had infringed the rule by demanding unpaid consideration from suppliers and by having suppliers’ staff work without payment.

The first case after the surcharge regime entered into force was the JFTC’s decision of 13 December 2011 concerning Toys“R”Us-Japan. The decision treated the return of goods taken from suppliers, and the subsequent reduction of their prices, as an infringement. Following the undertaking’s objection, the decision was partly set aside at the end of the hearing procedure; the surcharge was reduced because, in respect of certain suppliers, abuse of a superior position was found not to have occurred. That was an early sign that criticism of the provision’s uncertainty was not merely theoretical.

The highest surcharge imposed to date is the approximately 4 billion yen administrative fine applied to the white-goods and electronics retailer EDION by the JFTC’s decision of 16 February 2012. What is striking is that this amount is the highest not only within the category of unfair trade practices but across unilateral conduct as a whole, for no administrative surcharge has ever been imposed under the private-monopolization provision. The finding that, in Japan, the supervision of unilateral conduct in practice runs through the superior-bargaining-position rule rests on that figure.

The entry of the commitment procedure into the Antimonopoly Act at the end of 2018 changed the character of enforcement once again. The most distinctive feature of the commitment procedure is that it makes possible an outcome that a cease-and-desist order cannot: repayment to the suppliers who have suffered harm. The JFTC accepted the commitment plans submitted in respect of Genky Stores on 5 August 2020 and Amazon Japan on 10 September 2020 precisely because they included repayment to suppliers. In the Amazon Japan file, price reductions and unpaid contributions had been demanded of suppliers, together with unfair return practices; the undertaking paid some 1,400 suppliers a total of around 2 billion yen. That sum would not have been obtained had the cease-and-desist route been followed.

The point should be underlined for Turkish law. The commitment mechanism in Article 43 of Act No. 4054 is directed, in essence, at removing the competitive concern; compensation for the person harmed is the subject of a separate private action under Articles 57 and 58. Japanese practice shows that providing compensation inside the administrative procedure is technically possible.

D. The second layer: subcontracting legislation

To read the Japanese model only through the Antimonopoly Act would be incomplete. Beneath the superior-bargaining-position rule lies a second layer, specific to manufacturing supply chains and much more detailed: the 1956 legislation commonly called the Subcontract Act (Shitauke Hō). In relations between large ordering undertakings, identified by a capital criterion, and subcontractors, that Act provides for a duty to issue written documents, limits on payment periods, and prohibitions on price reductions and unfair returns. Its difference from the Antimonopoly Act is that superiority need not be proved separately; once the capital threshold is crossed, the rules apply directly. In other words, the elements that make the general provision heavy to prove have been turned, for a defined type of relationship, into a statutory presumption.

That second layer was fundamentally renewed by an Act adopted on 16 May 2025 and entering into force on 1 January 2026. The amendment changed even the name of the statute. The term “subcontractor” (shitauke) was removed from the text on the ground that it evoked an unequal relationship, and the parties were renamed “the ordering undertaking” and “the small or medium-sized undertaking receiving the work”. A choice that looks terminological also shows the political will behind the reform.

The substantive changes fall under four heads. The first, and the most important, is the prohibition on fixing the price unilaterally without a proper negotiation; failing to respond to price negotiations, or failing to provide the explanation and information required during them, is itself an infringement. The second is the prohibition of payment by promissory note and of methods of payment that make it difficult for the creditor to collect the whole price on the due date. The third is an extension of scope: transport work was brought within the Act, and a headcount criterion was added alongside the capital criterion. The fourth is the strengthening of the competent authorities’ powers of information-sharing and guidance, and of the regime of protection against retaliation.

The reason for adding the headcount criterion is particularly instructive. Where only a capital criterion is used, undertakings that are large in fact but thinly capitalised remain outside the scope; moreover, ordering undertakings could avoid the Act by requiring the counterparty to increase its capital. The example shows how open threshold-based rules are to avoidance, and it is relevant to the scale definitions in Act No. 6585 in Türkiye.

The expressly declared aim of the amendment is that increases in labour, raw-material and energy costs should be passed up the supply chain (tenka). This is the Japanese version of the role competition law assumes in an inflationary setting, and it bears directly on the debate in Türkiye.

The third and newest layer is the regulation of transactions with freelancers. The guidance the JFTC has published in that field shows the logic of superiority extended to sole traders who are not legal persons. Protection against power asymmetry in Japanese law thus forms a three-ring structure: a general provision (the Antimonopoly Act), a detailed regime for a type of relationship (the subcontracting legislation), and a regime for a type of person (freelancers).

E. Extension to digital markets

The most striking development of the superior-bargaining-position rule over the past decade is its extension to digital platforms and even to the platform–consumer relationship. In December 2019 the JFTC published a separate set of guidelines on transactions between digital-platform operators and consumers who provide their personal data. The theoretical claim of the guidelines is this: to the extent that the consumer provides personal data in exchange for the service, the consumer is a “party to a transaction”; if the platform is in a superior position vis-à-vis that consumer, unilaterally imposing the conditions on which the data may be used can amount to abuse of a superior position.

The approach has been criticised for blurring the boundary between competition law and data-protection law. Doctrine has argued that most of the abuses listed in the guidelines overlap with the Japanese Act on the Protection of Personal Information, while the superiority regime may still have a distinct function for profiling activities that data-protection legislation does not effectively capture. The same writers treat the possibility of extending the concept of a “superior bargaining position” without limit, and the scarcity of surcharge cases, as the weak points of the approach.

For Turkish law the counterpart of that debate is direct. The intersection of Act No. 6698 and Act No. 4054, together with the question of how the line of competence between the Competition Authority and the Personal Data Protection Authority is to be drawn, is a discussion that has not yet matured.

A. Article 6 of Act No. 4054 and economic dependence: the course of the Board’s case law

The Competition Board met the question of economic dependence at an early stage, and its case law has followed a two-stage course.

In the first stage the Board used language that was receptive to the concept. In the BETA decision of 21 December 2000 it said that a situation arising from customers’ dependence on a supplier, even where the supplier is not dominant on the whole of the market on which it operates — the situation the literature calls economic dependence — could be treated as another form of abuse in respect of a refusal to supply. The decision stated that, in establishing economic dependence, it is necessary to examine whether the customer has other sources of supply, and that if there is no adequate source and an interruption of supply would cause lasting and significant disadvantages to the dependent undertaking’s competitive strength, the supplier’s cutting off of supply may be prohibited in competition law even if the supplier is not dominant. Likewise, in the Karbogaz and Habaş decisions, economic dependence was described as a very important criterion in the finding of dominance, and in some cases as sufficient on its own for that finding.

Those statements must be read carefully. The Board positioned economic dependence not as a substitute for dominance but as a criterion used in finding dominance. The MEPA decision of 16 May 2000 drew the line expressly. It stated that the definition of dominance in Article 3 of Act No. 4054 requires the supplier to be dominant in respect of the whole relevant product market, not merely in respect of its commercial relationship with its customer, whereas economic dependence arising from the supplier–customer relationship supports only the claim of significant market power against that customer. The conclusion was stated plainly: if the supplier is not dominant on the market as a whole, it is not possible to claim that it is dominant against the customer on the basis of economic dependence alone.

In the second stage the Board did not merely confirm that line; it expressly referred the dispute to another branch of the courts. The Koçtaş decision of 13 October 2011 is decisive in this respect. The allegation was that a DIY-retail chain had made its supplier’s business more difficult by pressing it into consignment sales — that is, the typical pattern of fact in the Japanese practice. The Board said that, under Turkish competition legislation, economic dependence can be considered only within Article 6 of Act No. 4054, and that the dominance condition required by that article corresponds to a situation beyond economic dependence. It concluded that the matter arose from the agreement between the retailer and its supplier, in proportion to the parties’ bargaining power, and could be addressed by the standards of the commercial codes. The decision expressly noted that the supplier could apply to the commercial courts in respect of demands contrary to commercial practice and/or the contract, and unanimously found no ground to open an investigation.

A finding in the same decision is important for the economic dimension of the question. The Board recorded that, in the literature on buyer power in retail, it is generally accepted that a retailer accounting for ten per cent or more of a supplier’s sales has asymmetric power over that supplier and can use that power in negotiations to dictate commercial practices to the supplier’s disadvantage. The Board also noted, however, that in the practice of countries that have written economic dependence into competition and/or commercial legislation, and having regard to freedom of contract and the requirements of a market economy, what is required, alongside a scarcity of alternative sales channels, is dependence in the form of a sales ratio above the level of twenty to thirty per cent. That means not that the Board failed to see the problem, but that it had no instrument under the legislation then in force.

A similar result emerged in the Metro Grosmarket decision of 9 August 2012. The allegation was that the undertaking, by reason of its buyer power, demanded payments from suppliers under various names and imposed a consignment condition. Referring to the conclusions of the 2012 Final Report of the Sector Inquiry into Fast-Moving Consumer Goods Retailing, the Board accepted that the increase in buyer power — arising from retailers’ scale, their ownership of shelf space, and their position as competitors of their suppliers through private-label products — affects the imbalance of power between supplier and retailer, at times to the supplier’s disadvantage. It held, however, that no retailer group could be assessed as having buyer power at a level that would distort the competitive structure of the procurement market.

The structure of that reasoning is the crux of the comparative analysis. The Board accepts that an imbalance of power exists and that it produces results to the supplier’s disadvantage, yet it requires, as the threshold of intervention, a distortion of the competitive structure of the market. The Japanese provision does not require that threshold at all. The difference between the two systems lies not in the finding of the facts, but in the threshold at which the fact so found produces a legal consequence.

Finally, buyer power can itself prevent a finding of dominance. In the Tirsan Kardan decision the Board found elements indicating that the undertaking was dominant by market share and by its position on the market, but also found that, as a supplier of products to global automotive manufacturers, it sold into a market of powerful buyers. Taking those reasons together, including the existence of buyer power, it concluded that the undertaking was not dominant. Power asymmetry in the supply chain thus functions, under Act No. 4054, not only as something that is unprotected, but also as a factor that reduces the other party’s responsibility.

B. The draft amendment and the opportunity missed

The only serious attempt in Turkish law to pass beyond the dominance threshold was the Draft Act Amending the Act on the Protection of Competition, prepared in 2022 and shared with the public. Draft Article 6/A would have prohibited fourteen separate acts in respect of undertakings with “significant market power”; the prohibited acts could be grouped under information asymmetry, interoperability, tying, exclusivity, and data-based and discrimination-based obligations and prohibitions.

The draft was not enacted. What is striking is not that it failed, but its scope: the provision was conceived for digital platform services. Türkiye’s only attempt to move past the dominance threshold was specific to digital markets and did not cover the classical asymmetry of the supply chain. Among the criticisms directed at the draft in the literature was that the scope of the new purpose, expressed as “establishing a fair and contestable market”, had been left open, and that it could not be seen whether that purpose fitted the spirit of Act No. 4054. That criticism is the exact Turkish counterpart of the “mismatch of purpose” criticism directed at the Japanese model, and it would apply equally to a proposal for a general provision.

C. Act No. 6585: a sectoral and administrative solution

Turkish law’s principal answer to supply-chain asymmetry lies outside competition law, in Article 6 of Act No. 6585 on the Regulation of Retail Trade, as amended, together with its heading, by Act No. 7435, which entered into force on 1 February 2023.

The provision is headed “Unfair commercial practices in the supply chain” and builds a two-layer structure. The first paragraph gives a general definition: in commercial relations among producers, suppliers and retail businesses, activity by one party that significantly disrupts the other party’s commercial activity, reduces its ability to take a reasonable decision, or causes it to become a party to a commercial relationship it would not have entered on normal terms, is an unfair commercial practice. The second paragraph lists the cases that are always unfair commercial practices: forcing any person to obtain goods or services, other than conditions included in the contract in order to secure quality standards; passing campaign costs on to a party that does not wish to sell on promotion; failing, in the supply of agricultural and food products, to determine the conditions of the commercial relationship by a written or electronic contract; including in the contract terms that confer a unilateral right of amendment to the other party’s disadvantage, or that are not clear and intelligible; taking a payment, under the name of store opening and refurbishment, a turnover gap, a bank and credit-card participation fee, or any other name, without providing a service that directly affects demand for the product, or taking a premium or payment without specifying in the contract the type of service provided and the amount or rate of its price; cancelling, within the thirty days before the delivery date, orders for agricultural and food products that can spoil within thirty days; and passing on costs such as spoilage or loss after delivery of those products or after transfer of their ownership.

This catalogue overlaps, to a surprising degree, with the typical infringements listed in the JFTC Guidelines. A demand for consideration without return, a unilateral right to amend the contract, the passing on of cost to the other party, and unfair returns are the same conduct in both systems. The Act also sets upper limits on payment periods in Article 7: in relations between a small creditor and a medium or large debtor, and between a medium creditor and a large debtor, thirty days for quickly perishable agricultural and food products, forty-five days in other cases, and sixty days for other agricultural and food products. The burden of proving that payment was made on time lies on the debtor.

The sanctioning regime is set out in Article 18 and is notable for two technical features. First, a substantial part of the fines is proportional: a fine in the amount of the campaign cost passed on, in the amount of the premium and payment wrongfully taken, and in the amount of the cancelled order. Second, infringements of the payment period attract a daily-rate fine. Annual upper limits by scale are nonetheless imposed, and those amounts are increased by the revaluation rate. The power to impose the fines belongs to the Ministry of Trade.

The limits of the regime are equally clear. First, its scope is confined to the retail supply chain; relations in manufacturing subcontracting, a large part of service procurement, and a large part of dealership relations remain outside it. Manufacturing, which is the heart of the Japanese subcontracting legislation, is unregulated in Turkish law in this respect. Second, the competent administration is not the competition authority, so the Competition Authority’s capacity for economic analysis, its investigative tools and its knowledge of markets are not carried into this field. Third, and most important, the general definition in the first paragraph of Article 6 is in practice operated only within the limits of the catalogue in the second paragraph; no widespread practice has developed of using the general clause as an independent basis for intervention.

D. The private-law route: TCC Articles 54–55 and TCO Articles 20–25

The route to which the Competition Board directed the parties in Koçtaş is the private-law route. Its capacity should not be underestimated.

The second paragraph of Article 54 of the Turkish Commercial Code treats as unfair and unlawful deceptive conduct, and conduct otherwise contrary to the rule of good faith, and commercial practices, that affect relations among competitors or between suppliers and customers. The Grand Chamber of the Court of Cassation has stated expressly that the unfair-competition provisions protect not only competitors but also suppliers, customers, consumers, buyers and parties to the contract; that the cases listed in Article 55 are not exhaustive; and that every act and practice falling within the general rule may constitute unfair competition. For the general rule, a competitive relationship between the parties, a benefit to the infringer, fault, or the occurrence of damage is not required; the only condition is that the act be contrary to law or to the rule of good faith.

That is, in theory, an extremely wide door. Moreover, Article 55(1)(f) of the Commercial Code expressly treats as unfair competition the use of transaction terms contrary to good faith — in particular pre-formulated standard terms that depart significantly from the statutory scheme, or that provide for a distribution of rights and obligations significantly contrary to the nature of the contract. Given that retailer–supplier contracts are typically printed forms prepared by one side, the reach of the provision is plain.

The provisions of the Turkish Code of Obligations on standard terms work in the same direction. In a decision of the 19th Civil Chamber of the Court of Cassation, a standard term on a service fee in a contract between a buyer and a supplier was held to be a term of unfair content, imposing a disproportionate burden on the supplier, aggravating its position, and stipulated solely for the buyer’s benefit in a manner contrary to good faith, and therefore to be absolutely void. The decision also stated expressly that the parties’ status as merchants did not change the result.

That last sentence is critical for the comparative analysis. Turkish private law does not refrain from reviewing content even in relations between merchants. The problem of “ineffective enforcement of contract law”, offered as the reason for the Japanese model’s existence, does not have the same weight in Turkish law, at least at the normative level.

The difference between normative possibility and actual enforcement is nonetheless decisive here. The private-law route has three structural weaknesses. The first is the cost and duration of bringing an action, which deter a supplier that obtains most of its turnover from the defendant. The second, and the heavier, is the risk of retaliation: suing inside a continuing commercial relationship means the end of the relationship, so actions are typically brought only after the relationship has already ended and do not serve a preventive function. That the Japanese system is administrative, and that it provides specific protection against retaliation, is precisely an answer to this problem. The third is that the private-law route resolves an individual dispute; it does not bring a systemic and widespread practice to an end.

E. Reading the picture

Read together, the four headings above produce the following picture. Power asymmetry in the Turkish supply chain is not a legal vacuum; on the contrary, it is partly captured by more than one regime. The problem is less a gap in coverage than the dispersion of that capture.

• The Competition Authority has the capacity to identify the phenomenon and a stock of economic analysis, but it has no power to intervene because of the dominance threshold.
• The Ministry of Trade has the power to intervene, but its power is confined to the retail sector and does not draw on the stock of competition law.
• The civil courts have a wide normative framework, but they are little used in practice because of the risk of retaliation and the structure of the individual action.

A. Structural differences in the way of a transplant

Three structural differences make a direct transplant of the Japanese model difficult.

The first is a difference of institutional culture. The JFTC is an authority that conducts its practice predominantly through dialogue, guidance and commitments; cease-and-desist orders are few by comparison with warnings and cautions. That allows an uncertain provision, such as superior bargaining position, to operate as an instrument of behavioural change rather than as a threat of punishment. The Competition Authority’s enforcement culture in Türkiye is more decision-oriented; it cannot be assumed that the same provision would operate in the same way in Türkiye.

The second is the structure of judicial review. In Japan, review of surcharge decisions was for a long time conducted through the hearing procedure inside the JFTC, and decisions were corrected at that stage, as in Toys“R”Us. In Türkiye, review of Board decisions belongs directly to the administrative courts — the 13th Chamber of the Council of State — and case law forms more slowly. The predictability of an uncertain provision depends on the speed and intensity of judicial review.

The third, and the most important, is the state of contract law. The strongest theoretical justification of the Japanese model is that it compensates for the ineffective enforcement of contract law. In Turkish law, as shown above, both Articles 54–55 of the Commercial Code and Articles 20–25 of the Code of Obligations are open to a review of content in relations between merchants, and they are applied in that direction by the Court of Cassation. The same gap is not of the same size in Türkiye.

B. The arguments that nevertheless support a transplant

The finding above does not lead to the conclusion that a transplant is unnecessary. There are three counter-arguments.

The first is the difference between normative possibility and actual enforcement. The door of Turkish private law is open, but suppliers are not seen to pass through it. The risk of retaliation and the cost of litigation make the normative possibility unusable in fact. A legal system has to measure the difference between protection on paper and protection actually provided.

The second is that the Competition Authority’s institutional capacity is left idle. In Koçtaş and Metro Grosmarket the Board identified the phenomenon and could not intervene. For an authority to refer a problem it has identified to another body is a waste of institutional resources.

The third is the macroeconomic importance of the supply chain. The expressly declared aim of the 2026 amendment to the subcontracting legislation is that cost increases should be passed up the chain. In an inflationary setting, a powerful buyer’s loading of a cost increase onto the supplier is not only a question of contractual fairness; it is a phenomenon that produces a loss of investment and employment on the supplier’s side and therefore also affects the long-term structure of competition. This is the most defensible way of relating a superior-bargaining-position rule to the purposes of competition law.

C. A proposal: not a general clause, but a graduated structure

On the balance above, adding to Act No. 4054 a broad and uncertain general clause in the Japanese style does not appear defensible. Such a provision would risk conceptual blurring in the purpose of the Act and, given the speed of judicial review in Türkiye, would produce a long period of uncertainty. A three-tier structure can be proposed instead.

The first tier is a limited opening in Act No. 4054. What may be added is not a general concept of “superior position” standing in place of dominance, but a provision that prohibits a defined, limited and typified set of acts in a relationship of economic dependence. Scope should be confined by objective criteria, such as a dependence threshold (for example, that a given share of the counterparty’s turnover is obtained from a single undertaking) and the absence of an alternative channel of dealing. The comparative threshold of twenty to thirty per cent to which the Board referred in Koçtaş is a reasonable starting point for the discussion.

The second tier is an extension of the scope of Act No. 6585. The existing catalogue in Article 6 is essentially well aimed; the problem is that its scope is confined to retail. A parallel regime for manufacturing subcontracting and for the procurement of services would perform the function of the Japanese subcontracting legislation. A warning from the Japanese experience should be taken into account: thresholds based only on capital or turnover are open to avoidance, and criteria that are harder to manipulate, such as headcount, need to be added.

The third tier is procedural. If it is accepted that the real bottleneck is procedure rather than substantive law, the interventions with the highest return are these: (i) protection of the identity of a complaining supplier, together with an express prohibition of retaliation and an easing of proof; (ii) clarification that the commitment mechanism in Article 43 of Act No. 4054 can be operated, as in the Japanese practice, so as to include repayment to the person harmed; and (iii) a mechanism for information-sharing and referral between the Competition Authority and the Ministry of Trade.

The difference between this three-tier structure and the Japanese model is that it rests on typified conduct and objective thresholds rather than on a general concept. What it takes from the Japanese model is that it addresses the problem inside an administrative regime, rather than referring it to private law, and that it places the compensatory dimension inside the administrative procedure.