Dawn Raids In M&A: The TCA's Use Of On-Site Inspection Powers To Police Pre-Closing Conduct In The Dgpays/Provision Transaction

A. Introduction

Two recent decisions of the Turkish Competition Authority ("TCA") offer a window into how competition authorities can deploy their full investigative arsenal in the context of merger control enforcement. Taken together, the decisions concern the proposed acquisition of Provision Bilgi İşlem Sanayi ve Ticaret AŞ ("Provision") by Dgpays Bilişim Hizmetleri AŞ ("Dgpays") acting through its wholly owned subsidiary Dgpaysit Bilişim Teknolojileri AŞ ("Dgpaysit"), and they raise two distinct but closely related questions: Whether the parties engaged in gun jumping prior to obtaining the TCA's clearance, and whether Provision obstructed an on-site inspection conducted in order to gather evidence relevant to that assessment.

What makes these decisions particularly noteworthy is the investigative sequence that underlies them. The on-site inspection was conducted in the context of the same merger control file in which Provision's acquisition had been notified, and followed complaints received during the review process. Acting on these complaints, the TCA exercised its powers under Articles 14 and 15 of Law No. 4054 against Dgpays, Dgpaysit, Provision and their affiliates. On-site inspections are rarely seen in merger control proceedings, where the typical tools are information requests. The deployment of dawn raid powers to investigate pre-closing conduct signals that the TCA is prepared to use its broadest investigative tools when gun jumping is suspected.

The parties operate in the financial technology market. Provision is a software company that develops card management, POS/merchant management, SoftPOS and HCE-based digital wallet solutions for banks and payment institutions, providing software licensing and maintenance/support services. Dgpays, for its part, is an integrated service provider in financial technology and payment systems that offers both software development and real-time operational process management on behalf of clients, providing comprehensive, end-to-end infrastructure services. The two businesses are described in the notification as operating in a complementary manner within the same value chain.

B. The On-Site Inspection Decision

The subject matter of the on-site inspection decision is the obstruction of an inspection conducted at Provision’s premises in the context of merger control proceedings concerning Dgpays’s intended acquisition of sole control over Provision. The TCA had authorised the exercise of its inspection powers under Articles 14 and 15 of Law No. 4054 in connection with this process.

The case handlers arrived at Provision's premises at 10:36 on 27 October 2025 and presented their authorisation documents and TCA identity cards to the company's representatives. Upon entry, the team informed the undertaking's representatives of the subject matter and scope of the inspection and issued an express warning that no emails, information, documents or correspondence should be deleted from computers, electronic mail accounts or any other data storage devices until the inspection was completed, noting that any such deletion would constitute obstruction of the inspection regardless of the content deleted.

The inspection was carried out on the computers and email accounts of several named employees across various functions. A separate episode then arose in relation to a senior employee who was not present on site at the outset of the inspection. Multiple attempts were made to contact this individual by phone during the morning; the inspection team was eventually informed that the individual had entered a meeting in the European part of Istanbul and would attend Provision's offices afterwards. The individual arrived at 16:21, after which the inspection team began examining the individual's email accounts and Teams messages and also requested access to the individual's mobile telephone.

The relevant individual stated that the single telephone was used both personally and for business purposes, that it contained personal information, and that for this reason the individual did not wish to permit its inspection. After being informed of the applicable fines under Turkish Competition Act, the individual maintained the refusal and requested that a formal record be drawn up.

The TCA assessed this conduct in light of previous TCA and judicial decisions and concluded that what occurred constituted obstruction or impediment of the on-site inspection, the TCA unanimously decided that the on-site inspection had been obstructed and imposed an administrative fine on Provision equal to five per thousand (0.5%) of its 2024 gross revenues.

C. The Gun Jumping Decision

The gun jumping decision concerns the assessment of whether Dgpays's acquisition of sole control over Provision, had been implemented without the prior approval of the TCA. The notification was registered with the TCA. During the assessment process, two confidential complaints were received, alleging that Dgpays had begun conducting the sales and marketing process for Provision's card acquiring infrastructure services, had submitted a commercial proposal to a named customer in relation to Provision’s services, and that Provision's officials had made public statements suggesting the transfer had already taken place, in circumstances where TCA clearance had not yet been obtained.

Provision qualifies as a "technology undertaking" within the meaning of the Merger Regulation, being active in financial technology and software. The applicable rules provide that transactions involving the acquisition of technology undertakings are subject to mandatory notification even in the absence of the individual turnover thresholds that would otherwise apply.

The documents obtained during the on-site inspections were assessed against the complaints made. The TCA organised its analysis across three thematic categories: investor-related communications, business partnership communications, and acquisition-related communications.

On the investor-related communications, the TCA found that Dgpays had sought operational data from Provision, including transaction volumes and customer numbers, for use in presentations to overseas investors, and that this fell within the ordinary scope of investor relations activity during an acquisition process.

On the business partnership communications, the TCA assessed a large volume of documents showing joint customer meetings, shared pricing work, joint proposals and coordinated product presentations between Dgpays and Provision. The TCA considered Dgpays's activities in the context of its complementary relationship with Provision: Dgpays provides end-to-end operational infrastructure while Provision supplies specific software components, and this arrangement may require technical coordination, integration planning and communication for the purpose of delivering coherent solutions to shared customers.

The TCA ultimately assessed these communications as reflecting ordinary coordination between two independent service providers within a complementary business partnership delivering technical integration to common customers, rather than as evidence that Dgpays had acquired control over Provision ahead of clearance.

The TCA also considered a statement by a Provision official indicating that, as a result of the merger process, Provision had not made and could not make approaches to third parties without the knowledge of Dgpays. However, the TCA concluded that this was a single one-off statement unsupported by other evidence in the file and did not, standing alone, constitute a determinative indicator of de facto control.

The TCA further noted that the parties had actively tracked the clearence process and had even amended their share purchase agreement to extend the long-stop date to accommodate the clearence timeline, which was inconsistent with any intention to close the transaction without TCA approval.

The TCA unanimously concluded that the transaction was subject to mandatory clearance, but that the transaction had not been implemented without the TCA's clearance and therefore there were no grounds for the imposition of an administrative fine. Relevant complaint was dismissed.

D. The Link Between the Two Decisions

The procedural architecture of these two decisions is as instructive as their substantive conclusions. Both arise from the same case file and share the same casehandlers. The decision to conduct on-site inspections was taken at the TCA meeting of 23 October 2025 and concerned not only Provision but Dgpays, Dgpaysit and their affiliates. Inspections were carried out on 27 October 2025 at the headquarters of Dgpay, Dgpaysit and Provision.

We consider that this sequence reflects a deliberate strategy. Rather than relying solely on the complainants' allegations and publicly available information, the TCA elected to use its most powerful information-gathering tool to obtain documentary evidence of the parties' pre-closing conduct. The result was a file of 48 separate documentary findings, consisting of email chains and WhatsApp conversations between employees of Dgpays, Dgpaysit and Provision, covering a period from as early as November 2024 through to October 2025. The breadth and chronological depth of this evidence base would have been difficult to assemble through information requests alone.

The decision to launch a dawn raid in a merger control context is unusual in itself. The TCA's willingness to escalate to on-site inspections suggests that the complaints it received were regarded as sufficiently credible and the risk of evidence loss or destruction as sufficiently acute to warrant immediate action. For practitioners, this is an important signal: the TCA does not treat merger control as an area in which its coercive investigative powers are unavailable.

E. Practical Implications

These two decisions, read together, carry implications for parties to M&A transactions with a Turkish dimension.

Gun jumping remains a live enforcement risk throughout the pre-closing period. The TCA's gun jumping enforcement record is substantial. The total number of gun-jumping decisions in the TCA's enforcement history stands at around 60. The Dgpays/Provision case shows that the TCA will investigate pre-closing conduct not only when parties fail to notify a transaction altogether, but also when there are indications that commercial integration or operational coordination may have begun before clearance.

Against the foregoing, we understand that dawn raids are not a tool reserved for cartel or unilateral conduct investigations. Practitioners tend to prepare clients for the possibility of a dawn raid primarily in the context of antitrust investigations. The Dgpays/Provision case demonstrates that the TCA is willing to authorise and deploy on-site inspection powers during the assessment of a pending merger notification. Companies dealing the pre-closing period in Turkey should now treat the risk of an unannounced inspection as real and should ensure that their records of pre-closing interactions are well-documented, clearly ring-fenced from integration planning, and consistent with any publicly stated rationale.

Obstruction of inspections carries a standalone financial cost and reputational risk. Under Turkish Competition Act, obstruction or impediment of an on-site inspection attracts a fine equal to five per thousand of an undertaking's gross revenues. It further provides for a daily fine of five ten-thousandths of gross revenues for each day the obstruction continues. A refusal to grant access to a mobile device, even on personal privacy grounds, will not be accepted as a justification. Employees who are likely to be present during a dawn raid should be trained in advance on their obligations under Turkish competition law.

The technology undertaking exception requires particular vigilance in deal planning. For transactions involving technology undertakings, Merger Regulation disapplies the individual turnover thresholds that would otherwise apply to the target, meaning that the aggregate Turkish turnover test can be met by the acquirer's revenues alone. This makes it easier for a transaction to cross the notification threshold without the parties fully appreciating it. The TCA actively monitors technology sector transactions and is willing to sanction late or absent notifications.

E. Conclusion

The Dgpays/Provision decisions represent an important data point in the evolution of the TCA's merger control enforcement. In sum, the Dgpays/Provision decisions illustrate the TCA’s readiness to deploy its full investigative toolkit, including dawn raids, within the merger control framework where pre-closing conduct raises concerns.

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