Antitrust Practices: Clearances, Unfair Competition, and Enforcement in Turkmenistan

1) What types of unfair competition are prohibited in your jurisdiction?

In Turkmenistan jurisdiction below actions are prohibited:

1. setting up and maintaining monopolistically high or low prices;
2. collusion or concerted coordinated actions aimed at market sharing;
3. restraint of market entry;
4. removing other participants from the market;
5. setting up or maintaining uniform prices;
6. abuse of dominant position;
7. the creation of an enterprise for the manufacture of any product of higher demand in the territory of Turkmenistan, and then terminating this activity for the purpose of the promotion of similar foreign products in the market;
8. concluding agreement on prices or on the distribution of trading areas;
9. restricting rights of other economic agents in Turkmenistan;
10. government monopoly in the tourist market;
11. infringement of company name and trademark rights;
12. stealing trade secrets;
13. taking actions that undermine the reputation of a competitor;
14. concluding agreements to limit production, divide markets, maintain monopolistically high or low prices;
15. appropriation of other people's trademarks, information that allows copying of products of other manufacturers;
16. restriction of competition through agreements or concerted actions aimed at setting or maintaining single prices.

2) What types of bid rigging exist, and how are they classified?

In Turkmenistan jurisdiction types and classifications of bid rigging are not described directly with regulations. There is only one Law that addresses two types of bid rigging, which is Law “On Holding Competitions for the Supply of Goods, Performance of Works, and Provision of Services for State Needs” mentioning Information Sharing / Market Manipulation and Bid Suppression / Withdrawal in Articles 14 and 30.

3) How do antitrust authorities detect and investigate cartels and anti-competitive agreements?

In Turkmenistan, there is no designated antitrust authority. Instead state bodies within the scope of their duties can detect that there is a cartel or an anticompetitive agreement on the basis of:

1. direct detection by the official himself, in particular as a result of planned and special official investigation;
2. receipt of materials from state bodies, local self-government bodies and public organizations;
3. information provided by individuals and legal entities, their applications, as well as information disseminated through the mass media.

4) What measures can companies take to mitigate antitrust risks?

Companies should implement robust internal controls to meticulously avoid any actions that could be interpreted as:

• Price manipulation (both excessively high or predatory low pricing);
• Market-sharing agreements;
• Acts that “restrict market entry” for competitors;
• Attempts to “eliminate competitors”.

They should also establish a system for the continuous monitoring and review of company’s commercial strategies and practices in Turkmenistan to ensure ongoing compliance with established conduct prohibitions and to promptly identify and address any potentially non-compliant conduct.

5) What are the specific rules governing undertakings with a dominant market position?

Turkmen law includes many rules that indicate prohibition of actions which lead to unfair competition. Specific actions prohibited by Code of Administrative Offences, Criminal Code, Law of Turkmenistan "On Entrepreneurial Activity" can be considered as specific rules governing undertakings with a dominant market position in Turkmenistan. Said prohibited actions are:

1. setting and maintaining monopolistically high and monopolistically low prices;
2. market sharing, restricting access to the market;
3. excluding other economic entities from it;
4. restriction of competition through agreements or concerted actions aimed at setting or maintaining single prices.

Turkmen law also mentions that benefits obtained by undertakings as a result of anti-competitive activities are subject to confiscation in accordance with the established procedure.

6) What powers do antitrust authorities have when conducting inspections?

In Turkmenistan, there is no single specialized antimonopoly body that would deal exclusively with competition issues. However, the functions related to monitoring compliance with antimonopoly legislation are distributed among several state bodies as Cabinet of Ministers of Turkmenistan, The Ministry of Finance and Economy of Turkmenistan, State Service for Intellectual Property, Supreme Audit Institution of Turkmenistan, State Committee of Turkmenistan for Statistics.

These state bodies have the right to conduct audits within the scope of the tasks assigned to them. If the action detected by these authorities constitutes a criminal act under the Criminal Code, the authorities may appeal to the prosecutor's office; if the action is an administratively prohibited act, the authorities have the right to initiate administrative proceedings.

If an inspection of a licensed enterprise reveals violations, the licensing authority may suspend the license in accordance with the procedure established by law.

Authors: Serdar Amanov (Senior Associate), Kerim Balkanov (Senior Associate), Gulenar Akmyradova (Paralegal).