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With the Communiqué amendment entering into force in February 2026 (Communiqué No: 2026/2), the baseline turnover thresholds in the Turkish M&A market were substantially evaluated upwards to mirror current inflationary dynamics. While this surge exempts numerous mid-market company acquisitions from the mandatory approval of the Competition Board, the lawmaker explicitly preserved the customized "lower threshold exception" specifically mapped out for "Technology Undertakings"—albeit with a newly refined geographical scope.
What are the explicit new bounds of this exception for technology ventures, start-ups, and digital operators? For investors drafting Shareholder Agreements (SHA) and Share Purchase Agreements (SPA), what legal landmines must be anticipated to prevent procedural bottlenecks with the Competition Authority?
How Does the Excepted Ecosystem Operate?
As a general rule in Turkish Competition Law, for a transaction to trigger mandatory Board approval, the distinct Turkish turnover of at least two parties must individually exceed 1 Billion TRY. However, globally and within Turkey, there is immense regulatory anxiety regarding "Killer Acquisitions," wherein colossal tech incumbents buy out emerging, innovative start-ups before they generate significant turnover, solely to neutralize future competitors.
To thwart these Killer Acquisitions, the "1 Billion TRY" lower threshold is bypassed when acquiring Technology Undertakings; instead, an exceptionally low threshold of 250 million TRY is applied.
For instance, if a biotech start-up only has a 350 Million TRY turnover in Turkey, its acquisition will still mandate a Competition Board filing (assuming the acquiring party hits the 9 Billion TRY worldwide threshold), precisely because it triggers the technology exception. Alternatively, a traditional logistics firm with identical turnover metrics could be acquired seamlessly without any notification.
Which Firms Qualify as "Technology Undertakings"?
According to the strict definition in the Communiqué, a technology undertaking operates in:
Categorizing these explicit sectors signifies that not every tech-adjacent firm qualifies. Yet, grey areas persist: Is an e-commerce logistics delivery company a digital marketplace? The operating legal doctrine is that if the firm "creates technology as its core product or manages a platform as a digital marketplace," it falls under the purview. Traditional businesses merely leveraging technology as an operational tool are excluded.
The Paramount 2026 Change: The "Resident in Turkey" Requirement
Under the prior framework, the exception possessed vast extraterritorial reach. It inherently captured any technology undertaking "operating in Turkey, OR conducting R&D, OR providing services to Turkish users"—irrespective of where the company was physically established.
For instance, if an Ireland-headquartered SaaS provider generated 500 Million TRY from Turkish user accounts, its acquisition by a US tech giant was previously subject to the Turkish Competition Board's mandatory review.
The New Paradigm (2026): Through the revised Communiqué, the geographical overreach has been substantially narrowed. The exceptional low threshold now applies exclusively to technology undertakings "Resident" in Turkey.
To trigger the technology exception mechanisms:
Precedent Scenarios in M&A Transactions
Scenario 1: Turkish Startup - Foreign Fund (Exception Triggered)
A financial technology company, established in Turkey with a Turkish turnover of 400 Million TRY, is targeted for acquisition by a French Private Equity fund generating 15 Billion TRY globally. Since the acquired target is a "Technology Undertaking" resident in Turkey, the standard 1 Billion TRY lower threshold collapses to 250 Million TRY. The transaction unequivocally mandates Competition Board authorization.
Scenario 2: Foreign Firm - Turkish Acquirer (Exception Bypassed)
A US-based cybersecurity firm generates a global turnover of 12 Billion TRY, of which 300 Million TRY comes from its corporate client base in Turkey. A Turkish holding intends to acquire this firm (Holding turnover: 8 Billion TRY).
Although the cybersecurity target provides services "into" Turkey, it is legally NOT "resident" in Turkey. Therefore, the 250 million technology exception is voided. The general clause dictating a 1 Billion TRY lower threshold reigns. Since 300 Million < 1 Billion, the transaction is totally exempt from notification.
Legal Action Plan for Executives and PE Investors
1. Clarify During Due Diligence: If your target company generates turnover hovering between the new limits (e.g., between 250 Million and 1 Billion TRY), specialized competition counsel must decisively determine whether the target’s core business aligns precisely with the Communiqué’s technology undertaking definitions.
2. Defend Your Contract Timeline (Closing Adjustments): Although the preliminary review phase (Phase 1) is statutorily 30 working days, inquiries and Requests for Information (RFIs) frequently drag the process out to two months. The "Long-Stop Date" within the SPA must be constructed broadly enough to absorb regulatory lags.
3. Remember the Risk of Ex Officio Scrutiny (Law No. 4054, Art. 7): Do not fall under a false sense of security. Even if a transaction numerically ducks below all turnover thresholds, if the acquisition tangibly creates or strengthens a dominant position that significantly lessens competition in the Turkish market, the Competition Authority eternally holds the prerogative to launch retroactive investigations and unilaterally nullify the transaction.
4. Leverage Form Flexibility: Venture Capital (VC) and Private Equity (PE) entities—assuming their portfolio baskets hold no direct horizontal competitors or vertical links to the target—can now exploit uniquely streamlined short-form filing procedures newly embedded in the system.
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This article intends to offer a generalized analysis of dynamic M&A regulations and does not substitute for dedicated legal opinion or operational counsel.