In the third article of the series on Regulatory Traps, we examine the developments after a parliamentary commission’s work at the Grand National Assembly of Turkey (TBMM). Although the first few paragraphs may seem technical, the continuation of the article explores how an intervention by the relevant commission, driven by aesthetic concerns, resulted in unintended consequences.
In 1994, Article 16 of Law No. 4054 on the Protection of Competition was enacted, stipulating that a fine of 100 million Turkish Lira would be imposed for providing “false, misleading, or incomplete information.” However, since there was no clear provision regarding fines in the case of “not providing any information at all,” this lack of clarity led to potential misuse and, subsequently, the preparation of a proposed amendment to the law.
Moreover, due to the loss of the deterrent effect of fines in the face of inflation, a change was made in the Turkish Penal Code (TCK) to introduce a “revaluation” system. Under this system, laws published in specific years are adjusted by a specific multiplier to ensure the continued deterrent effect of fines. For example, according to the relevant article of Law No. 5252 on the Implementation and Application of the Turkish Penal Code, fines were increased by 29 times by the end of 2005. Therefore, as of the moment the amendment draft was prepared, the fine in question amounted to 2,900 Turkish Lira.
Consequently, if the entire clause were to be changed, the fine would correspond to a penalty issued in 2005, not in 1994, even if it remained the same. This would render it ineligible for revaluation, leading to a result worse than intended rather than enhancing deterrence. If the fine as it was in 2005 were incorporated into the clause, including a 2,900 Turkish Lira fine in an article that also contained fines of 20, 50, and 100 Liras, would disrupt the balance of the article. Therefore, the phrase “not providing any information” was added instead of changing the entire clause. The content of the clause was effectively frozen as of 1994 for the purpose of revaluation. A similar change was made to another clause.
The draft passed through the relevant authorities and began being discussed in various TBMM committees. Following a committee’s deliberations, the Competition Authority received notification that the 5-clause law had been transformed into 12 clauses. Consequently, some officials from the Competition Authority went to the TBMM. When the Committee Chairman shared the text that had passed through the Committee with the Competition Authority officials, it was noticed that the entire clause had been changed.
In this context, the first question from the Competition Authority expert was: “Mr. Chairman, why did you reduce the fines in the amended clauses?”
– “We didn’t reduce them; look, they’re the same.”
– “But Mr. Chairman, since the fine in those clauses had been published in 1994, it was subject to revaluation according to the TCK. We announce this every year. Look, that hundred lira fine is now applied as 2,900 lira.”
– “Okay, then you can still apply it as such.”
– “But now that the fine has been revised this year, there won’t be an opportunity to use the multiplier anymore. So the fine will be as low as dust from now on. This not only fails to increase deterrence but leads to a worse result; now we won’t get any information at all.”
– “Come on, that can’t be right…”
– “Mr. Chairman, if the Commission decided to reduce the fines, we would say, ‘It’s our Parliament’s will, there’s nothing we can do.’ But if there is no such intention in that direction, then there is a serious mistake. Therefore, if a decision has been made to reduce the fines, I won’t waste any more breath.”
– “No way. This wasn’t even discussed. Why would we want to reduce the fines? It’s just that your institution’s text was very complicated, and you’ve crammed words into the clause, making it look messy. Instead, we thought we’d just write the clause as it was for clarity. So, we have no objections to the content of the text that your Authority provided, but we felt the need for some correction because it was written badly. In the end, look, it’s perfect like a pearl, now!“
– “Mr. Chairman, even if the draft law looks perfect like a pearl now, the fines have been compromised in the process. If there is no intention in the Commission to the contrary, this needs to be corrected.”
– “I still don’t understand this. Anyway, okay, sit down at the computer, and you write how the clauses should be.”
Then, the Competition Authority expert sits in front of the computer and writes the text as it should be. When the Chairman reviews the text, he is surprised:
– “But this text you wrote on the computer is exactly the same as the one sent by the Authority.”
– “I wrote that myself, sir. We had to think so much to solve this revaluation issue; this was the only way we could achieve it.”
At this point, the Commission Chairman instructs the Commission Clerk:
– “Let’s take this text from the computer and format it to fit our style, replace the signed report with this, and have it signed.”
– “Oh, sir, the signatures have been completed, and the meetings are over. It’s not possible to make changes at this stage. Besides, who will explain this to the members of the committee? And after the debates have concluded, how will so many people come together now?”
Now, the Chairman insists: “Look, my friend, this young man has been trying to convince me for half an hour. If he’s working so hard and saying you’re making a mistake, I can’t just ignore that. What did we say in the Committee? We thought the Authority’s request was appropriate, but it became too convoluted; didn’t we say let’s write it properly? But it seems that mistakes are made when we write it this way… So, we’ll stick to the text the Authority sent. Say to the other members, ‘Let’s consider the text in the form the Authority sent. If anyone hasn’t signed or has questions, they can call me, and I’ll explain it to them.'”
The expert expresses his gratitude and leaves. The part of the draft related to fines is brought back to the form initially proposed by the Authority, and the legislative process is completed, with the amendment becoming law.
In conclusion, the lesson I draw from this is that even a draft carefully considered and prepared to solve a problem can sometimes lead to unintended consequences, especially through well-intentioned interventions. Therefore, from the preparation of any legislative draft to its publication in the Official Gazette or on the relevant website, at every stage, the slightest impact of any change should be thoroughly analyzed, and the effects of such changes should be consulted with the draft’s owner.
Furthermore, unless supported by necessary and sufficient technical analysis, aesthetic changes can pose serious risks and become a kind of trap.
In the following article, we will examine a law that imposes the obligation of having committed a heinous crime to become a president or a general secretary to the chambers of commerce.
P.S: You can access the previous articles from the following links:
- PITFALLS OF REGULATION – PART 1: CONFUSING THE GOAL WITH THE MEANS…
- PITFALLS OF REGULATION – PART 2: “A” STORY OF REGULATORY IMPACT ANALYSIS
(*) The views and suggestions presented in this article are entirely personal and not binding on any individual, institution, or organization.
