Usufruct and utilization - competition relation in fuel sector

The changes in the energy markets of EU need to be followed as they affect our country. There is importance of the relationship of price and demand as a result of competition which occurred in especially fuel oil sector. But the major problem for competing is usufruct which is used in Turkey as well as in EU. The right of usufruct is mostly used in fuel oil sector. Generally In this sector the process is carried between owners and fuel oil companies based on long term contrast and contracts between distributors and suppliers.Fuel oil distributor companies firstly make contracts with suppliers and get commercial bill as they sell the products and also bank guarantee letter in case of unpaid bill and frequently look for right of usufruct for real estate of fuel oil station.It is an expensive to make a working fuel oil station because of prices of area, built materials, establishing of technologic basis and etc... Generally stations are made by the fuel oil distributors. To get the investments back distributor companies have to force those stations to sell their products. That is why the distributor company searches the warranty by usufruct or the rights of veto.That is why distributor companies will use the right of usufruct and reduce their risk during planning long term sale strategies. Despite that this way is very natural and right it can create other problems.With the exemption arrangements made by the Competition Authority in relation to the vertical agreements, distributorship agreements from the aspect of fuel sector has been reduced to 10 years and by this time an evaluation being done by the Authority about the utilization agreements is requested by the distributors. In this study the reflections of the developments in the EU Countries are also analyzed along with those discussed in Turkey.The best sample of utilization-competition relation in fuel sector is the decision pertaining to the Spanish oil company REPSOL that determine EU Commission's approach to this issue.The EU Commission has reached the concision that the agreements made by REPSOL with their fuel distributors, those agreements that contained long time non-competition would emerge problems within the framework of Article 81 of Rome Convention. The fundaments of the European Union Competition Law are based on the legal framework which comprises basis for the foundation of the European Economic Community (ECC) and the Rome Convention that was signed in 1956 with six members.The EU Commission found REPSOL's commitments as satisfactory. in this contest, REPSOL will avoid signing Long tame exclusive agreements with stations they had made Long time supply agreements with, that would financially make a reasonable proposal for terminating these agreements. Consequently, it is stated that these commitments were considered satisfactory since the mentioned commitments would provide possibility for working with another distributor for all stations not owned by REPOSL yet supplied with fuel by them and would prevent REPSOL from binding more stations to themselves.Acting from Commission's REPSOL decision, it is understood that it is not considered possible conclude results by making comparison with REPSOL decision. However, due to the fact that the decision is one made by the EU, it is an explicit fact that the decision will generate effective results at all EU countries' level and will be effective in the Commission's approach in the event of similar complaints in the other countries.The objective of creating competition in the vertical business relations in fuel sector, by securing specific business freeness between the firms operating in the same business line, creating competition at a specific level, securing the reflection of this to the other levels mean enforcement of the entire market to competition.According to the alternate "Announcement of group Exemption Relating Vertical Agreements" numbered 200/2 along with Competition Authority's Announcement numbered 2003/3, the period of non-competition foreseen in the agreements is limited to five years. Since the distribution - franchise relationship as arranged by Act No. 5015 contains purchase/distribution terms and conditions from a monopoly, this limitation in the fuel sector has generated the result that the franchise time is reduced to five years and this aspect was notified to the distribution .companies.This application is still valid. However, we believe that implementation of the condition of five year limitation applicable to the agreements signed between distribution companies and vendors to the utilization agreements signed between the parties will be in contrary to both the currently effective regulations and equity.