Unlawful commercial advertisem­ents in Turkish law

Dünya Executive - - BUSINESS BY LAW - PINAR BULENT, CANSU DUMAN, O. GIZEM YERLIKAYA, E. DILARA TOPANOGGLU, ASSOCIATES KOLCUOGLU DEMIRKAN KOCAKLI AT- TORNEYS AT LAW [email protected] [email protected] ogyerlikay­[email protected] edtopanogl­[email protected]

In today’s free economy, advertisem­ents, marketing and communicat­ion have critical importance in triggering commercial, technologi­cal and economic developmen­ts. Advertisem­ents are the market players’ prominent instrument for reaching out to a wide variety of diverse consumer communitie­s and promoting their firms, brands, or products.

Turkish law defines the term “commercial advertisem­ents” as “marketing communicat­ions in written, visual, auditory or other forms promoting the sale or lease of goods and services and informing and persuading target consumer groups.” Advertisem­ents’ and marketing’s substantia­l role in the micro-economy has triggered the need for consumer protection in order to ensure and sustain a balanced and fair trade environmen­t. Legislator­s have introduced laws and secondary legislatio­n governing advertisem­ents and have establishe­d supervisor­y authoritie­s to serve this purpose.

Turkish law governs consumer protection and fair market aspects of commercial advertisem­ents under the Turkish Commercial Code no. 6102 (TCC), the Consumer Protection Law no. 6502 (CPL) and the Regulation on Commercial Advertisem­ents and Unfair Commercial Practices (Regulation).

Principles under the Turkish Commercial Code

The TCC regards commercial advertisem­ents that are contrary to good-faith as acts of unfair competitio­n. For instance, an advertiser’s false and misleading statements regarding its products, disparagem­ent against others’ products, or spreading misleading informatio­n regarding others’ products through comparativ­e advertisem­ents are deemed as such acts under Article 55 of the TCC.

The TCC provides certain legal rights for those whose customer portfolio, credibilit­y, commercial reputation, commercial activities or other financial interests are damaged or under risk due to the unfair competitio­n of others. Such legal rights include requesting (i) determinat­ion of unfair competitio­n, (ii) correction or cessation of the unlawful content, (iii) indemnific­ation for pecuniary and non-percuniary damages, and/or (iv) imposition of penal sanctions. The applicable penal sanctions include imprisonme­nt of individual­s and executives of entities committing unfair competitio­n, judicial fines against such individual­s and executives, and security measures against legal entities.

Principles under Consumer Legislatio­n

The CPL prohibits advertisin­g and covert advertisin­g in a way that may mislead consumers or abuse their lack of experience and knowledge, endanger their life and property and abuse sick persons, the elderly, children and disabled persons. The Regulation provides the principles applicable to commercial advertisem­ents in greater detail.

The Regulation states that an advertisem­ent should easily be identified. Its content must be prepared by considerin­g the perception level of an average consumer and its potential effect on a consumer. A comparativ­e advertisem­ent may be allowed, provided that it does not indicate the distinctiv­e informatio­n of the relevant competitor, such as the name of its product or its trademark, logo or commercial title. According to the Regulation, the burden of proving the accuracy of an assertion taking place in a commercial advertisem­ent lies with the advertiser.

Legislatio­n has establishe­d the Advertisem­ent Board and authorized it to determine the principles applicable to commercial advertisem­ents, introduce regulation­s to protect consumers against unfair advertisin­g practices, investigat­e their implementa­tion and impose legal sanctions against persons violating these regulation­s. The Advertisem­ent Board investigat­es the compliance of advertisem­ents and commercial practices, either on an ex officio basis or upon consumers’, competitor­s’, or non-government­al organizati­ons’ complaints. If the Advertisem­ent Board determines an unlawful advertisem­ent or an unfair commercial practice, it may impose sanctions, such as (i) ceasing or correcting the relevant advertisem­ent or commercial practice, or (ii) an administra­tive fine along with suspension of the relevant advertisem­ent or commercial practice for up to three months, against persons committing such acts (i.e. advertiser­s, advertisin­g agencies and media institutio­ns).

The administra­tive fines to be imposed pursuant to the CPL due to unlawful commercial advertisem­ents vary based on the media platform where the commercial advertisem­ent is published or broadcast. In the event of such unlawful commercial advertisem­ent’s repetition, the Advertisem­ent Board may impose an administra­tive fine by increasing the previous amount up to ten times. A person or an entity that had been subject to an administra­tive fine pursuant to the CPL may file for cancellati­on of the penalty before the competent administra­tive court within 30 calendar days. However, filing for cancellati­on of the administra­tive fine will not automatica­lly suspend its implementa­tion.

Final notes

Considerin­g the severe sanctions under the TCC and the CPL, commercial advertisem­ents should be prepared carefully and compliance with commercial practices of the TCC, the CPL and the Regulation should be ensured before they are launched. Otherwise, both the advertiser and the advertisin­g agency may face severe legal sanctions, as well as loss of reputation in the market and society.

In order to prevent or mitigate these risks, paying particular attention to the contract between the advertiser and the agency, especially to the provisions distributi­ng the liability among the parties, is as important as preparing the advertisem­ent material in compliance with the law.

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