The Competition Board’s Approach to Electric Vehicle Charging Stations

Evaluations Related to the Sector

The Board, in the BP Europa/Daimler decision^[2] -although the decision pertains to an acquisition- examined the market dynamics related to e-charging stations by considering the conditions at the time of the decision. It revealed that both the electric vehicle production market and the public electric vehicle charging station operation market in Türkiye are still in development. While market developments have progressed rapidly since the BP Europa/Daimler decision, it can still be said that the current market saturation level remains low.

In this context, public charging services are expected to evolve in parallel with the development of electric vehicles. The increase in demand for electric vehicles is likely to be proportionally reflected on the supply side. However, addressing the market entry barriers caused by regulatory and operational factors when making these evaluations is also important.

Evaluations on Barriers to Market Entry 

In its Decision, the Board highlights the financial and operational barriers to entering the electric vehicle charging market, which are encountered globally due to high investment costs. For instance, the absence of transformers with sufficient power capacity or the need for power upgrades can double investment costs. Moreover, the rapid advancement in charging station technology and software necessitates continuous investment, underscoring that the market constantly demands financial input and solutions to operational challenges, making market entry potentially challenging.

In addition to these financial and operational barriers, regulatory obligations also play a critical role. Specifically, undertakings wishing to operate in the public electric vehicle charging station market must obtain a license from the Energy Market Regulatory Board (EMRA). To secure a charging network operator license, businesses must comply with the criteria set forth under the Turkish Commercial Code. Furthermore, under the Charging Service Regulation, charging network operators must establish a charging network within six months of the license's effective date. This network must consist of at least 50 charging units across a minimum of five districts^[3] . Additionally, at least 5% of the charging units in the network and at least 50% of the charging units located on highways and state roads under the responsibility of the General Directorate of Highways must be DC units with a power of 50 kW or above^[4] .

Sector-Related Evaluations in the Product Market Definition

According to the findings in the Decision, electric vehicle charging stations are categorized into two main types based on their usage: "public" and "private or restricted use."^[5] Public charging stations are located in areas accessible to everyone, such as gas stations, shopping mall parking lots, and similar public spaces. In contrast, private or restricted-use charging stations are only accessible to specific user groups^[6] . For example, a charging station located within a residential complex, available only to the residents, is not considered a public station^[7] .

In its evaluation of the technical specifications of charging devices, the Board identified two main types of charging units: slow charging (AC) and fast charging (DC/HPC)^[8] . AC units deliver power up to 22 kW, while stations delivering power above 22 kW are classified as DC, and those providing power above 50 kW are referred to as HPC^[9] . It was noted that the charging time for electric vehicles depends on the power capacity of the charging device, and consequently, charging time is a key factor influencing consumer preferences^[10] .

Although there are differences between AC and DC units regarding structural features and cost factors, the relevant regulations, technical requirements, and commercial conditions allow enterprises to offer both AC and DC stations^[11]. From the demand side, it was found that electric vehicle users can benefit from both AC and DC units depending on their location, time, and personal/technical needs^[12] .

As a result, the Board concluded that the electric vehicle charging services market is an emerging market, which can be subdivided into categories such as "fast charging station installation and operation" and "slow charging station installation and operation."^[13] 

Exemption Assessment of the Cooperation Agreement

The Cooperation Agreement between Trugo and Shell aims to establish and operate electric vehicle charging stations at Shell-branded fuel stations, with Shell and Trugo separately covering their costs. The Agreement also includes providing services to customers needing electric vehicle charging via both parties' applications. Additionally, the expected outcomes of the collaboration include cost advantages, increased customer satisfaction, and promoting environmental benefits. The cooperation, which merges Shell's broad dealer network with Trugo's technical know-how, contains horizontal and vertical components. The possession of charging network operator licenses by the parties and their competitive position in the market makes the Agreement a horizontal arrangement. At the same time the accompanying Network Operation Agreement (to be signed among Trugo, Shell, and the location owner dealer) incorporates vertical elements.

In conducting the Cooperation Agreement exemption assessment, the Board conducted an in-depth review. As a result of this review, the Board stated that the growth in both electric vehicle and charging station numbers in Turkey and globally supports each other. This growth was seen as critical in light of Turkey's commitments under the Paris Agreement and its net-zero emission goals, and the planned cooperation was considered to significantly contribute to achieving the 2030 targets and combating climate change^[14] . The increase in alternative fuels was expected to reduce emissions, improve air quality, and support the infrastructure necessary to transition to clean energy^[15] . The Board determined that this cooperation meets the first condition for exemption, which is the promotion of economic or technical progress, by improving the efficiency of the services provided^[16] .

Moreover, considering the benefits provided to consumers and the contribution to developing the charging services market, the Board concluded that the cooperation fulfills the consumer benefit condition stipulated in Article 5 of the Competition Law No. 4054^[17] .

In assessing whether competition would not be significantly eliminated in a substantial portion of the relevant market, it was noted that, as of the decision date, 152 undertakings held licenses, and 77 of them entered the market in 2023^[18] . The Board concluded that this indicates no significant entry barriers in the market. It was also pointed out that various collaborations had been made between fuel distribution companies and charging network operators^[19] . However, considering the presence of other undertakings with significant market shares, the increase in the number of new entrants, and the fact that charging stations can be installed in various locations, the Board assessed that the impact of the notified cooperation on the market would be limited and that competition would not be eliminated in a substantial portion of the relevant market^[20].

Regarding the condition of not restricting competition more than necessary, the competition restrictions introduced by the Cooperation Agreement between Trugo and Shell were examined. Under these restrictions, Trugo will not establish charging stations at fuel stations located along the same routes where Shell has established charging stations, within cities and intercity routes within a certain distance. However, this limitation does not prevent Trugo from installing charging stations at hotels, restaurants, shopping centers, and vehicle maintenance services, which are not fuel stations but are suitable for electric vehicle charging stations^[21] . Furthermore, during a specific period after the implementation of the Cooperation Agreement, Trugo committed not to enter into any cooperation agreements with another fuel distribution company, while Shell agreed not to form any agreements with other charging network operators for electric vehicle charging station installation[22] . This exclusivity period is limited to a specific duration as mutually agreed by the parties^[23] . On the other hand, even if Trugo is under an obligation not to enter into a central agreement with a fuel distribution company other than Shell within the scope of the cooperation, it will still be able to conclude individual agreements with other fuel stations operating under a fuel distribution company other than Shell^[24] .

Considering other contractual details, it was also determined that the final exemption condition was met. The Board decided to grant individual exemption for the Cooperation Agreement, as it satisfied all the conditions under Article 5 of the Competition Law No. 4054.

Conclusion

The Board’s decision regarding the Trugo-Shell cooperation plays a significant role in preserving and promoting competition in the electric vehicle charging stations market. Considering the increasing prominence of electric vehicles in our lives, addressing charging station operations from a competition law perspective is critical for maintaining market balance and supporting the transition to sustainable energy. This decision serves as a valuable guide on how collaborations between charging station operators and fuel stations should be assessed within the competition law framework. Notably, one of the standout aspects of the decision is the emphasis on balancing exclusivity arrangements introduced under the cooperation to ensure they benefit consumers without excessively restricting competition. Furthermore, the Board’s emphasis on the necessity of expanding charging infrastructure not only to establish a competitive market structure but also to provide higher-quality and more sustainable services highlights the importance of this decision.