Newsletter & Legal Alerts

Q1/2017 Amendment to the Commercial Advertisement and Unfair Commercial Practices Regulation

The Regulation on Commercial Advertisement and Unfair Commercial Practices, which is the primary resource under which companies willing to advertise in Turkey have to abide by, has been amended through a new regulation published in the Official Gazette dated January 4, 2017 and numbered 29938.

A number of changes have been introduced through the new regulation. One of the key changes the regulation has brought concerns the burden of proof. The amendment requires that all advertisements need to be proven of their truth through “scientific data”. Previously, the content of advertisement and its statements were required to be proven with scientific reports. These reports could be obtained from various organizations, independent accredited institutions and/or universities. The amendment requires that only comparative advertisements need to be proven of their truth through documents obtained from such institutions. However, when deemed necessary this requirement can also apply to non-comparative advertisements.

The new regulation has introduced a couple of material changes and prohibitions to the rules regarding comparative advertising. Any declaration made regarding health benefits or food supplements cannot be subject of comparative advertising. Declarations regarding nutritional benefits can only be the subject of comparative advertising when this is suitable with the relevant legislation. In addition, comparative advertisements cannot be contradicting to the principles set out by the Advertisement Board. This way, the government hopes to set principles for companies to which they have to abide by when preparing an advertisement. Lastly, testimonies by persons or institutions are no longer allowed for comparative advertisements. In other words, comparative advertisements can only show its competitors through trademarks, logos etc.

Furthermore, the regulation has added an obligation to disclose regarding electronic communication. The advertiser must disclose that the connection speed and scope, if stated in the advertisement, can be subject to change due to infrastructure, geographical conditions, network density etc. In addition, if the alleged speed is reached in a testing environment, it must be stated in the advertisement that not all consumers can obtain that level. Lastly, consumers must be fully informed on any fair usage quota, speed quota or any other limitations.

Consequently, it is noted that the advertising practice for advertising in Turkey has been materially altered through this amendment of the Commercial Advertisement and Unfair Commercial Practices Regulation.

Published on: April 2017


Q4/2016 The Expert Law Entered into Force

The Expert Law was published in the Official Gazette dated November 24, 2016 and numbered 29898 (Law No. 6754). Expert opinion is widely used as a tool in courts throughout different justice systems and is also a very important part of the Turkish judicial system. However, according to the Turkish Ministry of Justice, the previous system of experts was an obstacle to the efficiency and effectiveness of the judicial system since the laws and provisions on experts have been spread out throughout many different laws and regulations. Law No. 6754 aims to develop and improve the current judicial system and bring together all the provisions that apply to expert opinions. Therefore, introducing a law that brings a coherent system regarding this field is a significant step for development of the judicial system. Limiting the scope of the mission of an expert is one of the most important points of Law No. 6754. In the new law, the scope of the mission of an expert is limited to questions of fact. This means that experts can no longer be used to answer or examine questions of law which is an issue at the sole discretion of judges.

Furthermore, Law No. 6754 establishes the rules concerning the qualifications for experts, their education, and how they will be audited. This way, it hopes to form an effective and active organizational structure. Law No. 6754 is divided into three sections:

The articles of the first part are primarily focused on the guiding principles for experts. Their duty should be guided by principles such as righteousness, independence, impartiality, confidentiality and objectiveness.

The second part of the Law establishes the organizational structure. This organizational structure concerning experts is an entire new level for the development of the court proceedings in Turkey. Embedded within the Ministry of Justice, the new structure includes a Department of Experts, an advisory committee for experts and numerous regional committees for experts. These units focus on issues regarding experts; their registry, acceptance, fees etc.

The final part of the Law focuses on the conditions required to be accepted or banned as an expert; these include but are not limited to educational conditions, technical expertise, five years’ experience etc. The Law No. 6754 also introduces an opportunity for legal entities to produce expert opinions meaning that not only real persons but also legal entities shall serve as experts to assist the Courts concerning the legal proceedings.

Published on: February 2017


Q3/2016 Amendments in the Cheque Law

The Law regarding the Amendment of Several Laws for the Improvement of Investment Environment was published in the Official Gazette dated August 09, 2016 and numbered 29796 (Law No. 6728) (the “Law No. 6728”). Under this Law, amendments were made to Cheque Law (Law No.5941) (published in the Official Gazette dated December 20, 2009 and numbered 27438) (the “Cheque Law”). The motive behind these amendments was to enhance the trust and the confidence in cheques since in recent years there has been a decline in this payment method which is considered as a remarkable payment method in business life.

 

In order to increase the trust and the confidence in cheques, the criminal liability is introduced again for the drawers of dishonored cheques which is considered as the most remarkable amendment made to the Cheque Law under Law No. 6728.

 

Furthermore, transparency in cheque transactions is increased since regulations are made with respect to the components of cheques and third parties are allowed access the data regarding the cheque, chequing account holder, and the drawers of such cheques through an information system. Provisions regarding cheques entered into force on the date of publication of Law No. 6728 except for the amendment to Article 3 of the Law on Cheques, which will enter into force on 31.12.2017.

 

Regarding the criminal liability for the drawers of dishonored cheques, pursuant the amendments made to Article 5 of the Law on Cheques, the person responsible of a dishonored cheque shall be subject to a judicial fine up to one thousand and five hundred days for each dishonored cheque on condition that the bearer files a complaint.

 

Such monetary fine cannot be inferior to the total of the dishonored amount of the cheque, the accrued interest and litigation expenses. In case of non-payment, this judicial fine shall be directly converted into imprisonment with no provision for community service. Pursuant to the amendment made in Article 6 of the Cheque Law, if the amount of the dishonored cheque and the accrued interest are paid or in case of withdrawal of the complaint during the proceedings, the lawsuit shall be dropped and in case of payment after finalization of the imprisonment judgment, the judgment shall be removed with all of its consequences. 

Published on: October 2016


Q2/2016 Establishment of Regional Courts of Appeal

The Law regarding the Establishment, Duties and Authorities of Courts of First Instance and Regional Courts of Appeal was published in the Official Gazette dated October 07, 2004 and numbered 25606 (Law No. 5235) (the “Law No. 5235”). Despite the Law No. 5235 in effect, its enforcement has been postponed for 12 years, to July 20, 2016 due to several inadequacies faced in establishment of Courts and appointment of judges. The Law No. 5235 has introduced the establishment of Regional Courts of Appeal which implements Regional Appeal, a new legal institution in the Turkish Legal System.

Regional Courts of Appeal started operating as from July 20, 2016 and the Turkish Legal System adopted one more instance to its two-instance system, being transformed to a three-instance system. In the new system, Regional Courts of Appeal will operate as the second instance, and the Supreme Court of Appeal will be the third instance.

In principle, the legal period for submission of regional appeal is 2 weeks in Civil Courts, 10 days in Execution Courts, 8 days in Labor Courts and 7 days in Penal Courts from the date of service or rendering the judgment depending on the specific provisions of the relevant lawsuit. In the same direction, local Court judgments which were not concluded before July 20 shall be considered within the scope of two-instance system.

Pursuant to Article 341 of the Civil Procedural Code (Law No.6100) (published in the Official Gazette dated January 12, 2011 and numbered 27836) (the “CPC”) the matter in dispute must be higher than 1.500 Turkish Lira in order to be subject to regional appeal. Pursuant to Article 272 of the Penal Procedural Code (Law No.5271) (published in the Official Gazette dated December 17, 2004 and numbered 25673) (except the judicial monetary fines converted from imprisonment sanction) judgments which require payment of judicial monetary fine amounting at least (and including) three thousand Turkish lira, judgments of acquittal rendered for crimes that require a judicial fine not exceeding five hundred days as the upper level of the punishment and judgments for which the way of legal remedy had been closed by law are exempted from the regional appeal.

Submission of appeal in the legal period to Regional Courts of Appeal prevents the decision to become final. Nonetheless, exceptions reserved, it does not prevent execution of the decision. In principal, decisions given by the Regional Courts of Appeal can be appealed to Supreme Court of Appeal unless there is a provision in the Law asserting the contrary.

Lastly, together with establishment of Regional Courts of Appeal, the legal remedy of “Correction of Judgment” which was specific to the Turkish Legal System has been abolished. 

Published on: July 2016


Q1/2016 Constitutional Court’s Decision Regarding the Partial Annulment of Article 20 of the Code of Civil Procedure Numbered 6100

Published in the Official Gazette dated February 23, 2016 and numbered 29633, the Constitutional Court partially annulled Article 20 of the Civil Procedural Law (Law No. 6100) (Published in the Official Gazette dated February 4, 2011 and numbered 27386) (“CPL”) regulating “the procedure with respect to the decision of incompetence or non-jurisdiction”.

As per Article 20 of the CPL, in case a lawsuit is rejected by the Court due to incompetence or non-jurisdiction, the parties to a lawsuit must apply to the Court by requesting that the file be sent to the competent Court/the Court which has jurisdiction within two weeks starting from the date when the decision became final and if the decision is final when rendered by the Court, as from the date of decision. In case there is no application within two weeks, the lawsuit shall be deemed as it has never been filed as per the same Article.

The expression “One of the parties must apply to the Court which rendered the decision within two weeks as of the date of decision if the decision is definitive when rendered by the Court…” provided under Article 20 of the CPL was brought before the Constitutional Court claiming that it is conflicting with Article 36 of the Constitution. Pursuant to Article 43 of the Establishment of the Constitutional Court and Trial Procedures (Law No. 6216) (Published in the Official Gazette dated April 4, 2011 and numbered 27894), the provision is also examined in accordance with whether it conflicts with Article 13 of the Constitution.

The Question of Unconstitutionality

Article 13 of the Constitution provides that “Fundamental rights and freedoms may be restricted only by law and in conformity with the reasons mentioned in the relevant articles of the Constitution without infringing upon their essence. These restrictions shall not be contrary to the letter and spirit of the Constitution and the requirements of the democratic order of the society and the secular republic and the principle of proportionality”.

In its decision, the Constitutional Court emphasized that in democratic societies, in terms of fundamental rights and freedoms, liberty is the rule, restraint is exception. Article 13 specifies to what extent fundamental rights and freedoms might be restrained.

Under Article 36 of the Constitution, it is stipulated that “Everyone has the right of litigation either as plaintiff or defendant and the right to a fair trial before the courts through legitimate means and procedures.” This article secures the right to legal remedies in the widest sense.

The Constitutional Court indicated in its decision that it is clearly seen that there is a violation of right to a fair trial thus of right of access to Court under Article 20 as it provides that the two weeks period shall begin running “as of the date of decision if the decision is definitive when rendered by the Court…”. Based on the rule, the time period would start just from the date of the definitive decision without a need to announcement or notice. Hence right to legal remedies of the parties is violated by this time limitation which results that there is a violation of Article 13 and Article 36 of the Constitution.

Based upon the above, the Constitutional Court annulled the expression “as of the date of decision if the decision is definitive when rendered by the Court…” provided under Article 20 of the CPL. However, it was also decided by the Constitutional Court that the annulment decision shall enter into effect 9 months after its publication in the Official Gazette due to a possible legal gap creating a violation of public interest. 

Published on: April 2016


Q4/2015 Monetary Thresholds Regarding the Jurisdiction of Consumer Arbitral Committees Have Been Increased

The Communiqué on Increasing the Monetary Thresholds Provided under Article 68 of the Consumer Protection Law and Article 6 of the Consumer Arbitral Committees Regulation (the “Communique”) was published in the Official Gazette dated December 20, 2015 and numbered 29568 and entered into force on January 01, 2016.

As per the Communiqué, consumers are obliged to apply to the consumer arbitral committees for disputes arising from the purchase of goods or services other than for commercial or professional purposes in the event the subject matter of the dispute is in accordance with the below thresholds provided under Article 3;

The threshold for applying to district consumer arbitral committees is TL 2,320.00.-, The threshold for applying to provincial consumer arbitral committees in metropolitan municipalities is TL 2,320.00.- to TL 3,480.00.-, The threshold for applying to provincial consumer arbitral committees in the provinces which do not have the status of metropolitan municipality is TL 3,480.00.-, The threshold for applying to provincial consumer arbitral committees in the districts of the provinces which do not have the status of metropolitan municipality is TL 2,320.00.- TL 3,480.00.-

Pursuant to Article 68 of the Consumer Protection Law (Law No. 6502) (Published in the Official Gazette dated November 28, 2013 and numbered 28835), consumers cannot apply to the Consumer Courts for disputes arising from consumer law of which the disputed matter is inferior to the above monetary limits.

Consequently, companies providing goods or services to consumers may raise an objection against lawsuits (where the amount subject to dispute is inferior to the above thresholds) filed before consumer courts and request rejection of the lawsuit on a procedural basis since as per sample judgment of Court of Appeals, the obligation to apply to consumer arbitral committees is considered to be a pre-condition for filing a lawsuit.

Published on: January 2016


Q3/2015 Regulation on Service Providers and Intermediary Service Providers in Electronic Commerce

Regulation on Service Providers and Intermediary Service Providers in Electronic Commerce (“Regulation”) was published in the Official Gazette dated August 26, 2015 and numbered 29457 and will enter into force on its publication date.

As per Article 4 of the Regulation, the service provider is defined as “the individual or legal entity which performs electronic commerce activities” while the intermediary service provider is defined as “the individual or legal entity which provides the electronic commerce platform for the commercial activities of third parties”.

Article 5 of the Regulation regulates the obligations of service providers to provide information. Pursuant to the first paragraph of the said Article, the service provider shall provide the below information on its own electronic commerce platform prior to commencing electronic commerce activities;

registered electronic mail address, e-mail address, and phone number, its company name, or registered trademark, professional organization and sectoral institutions of which it is a member, if any, together with its professional rules and information regarding how such rules may be accessed, if the service provider is a business man, its commercial name, central registry record number (MERSIS) and headquarters address.

As per the fourth paragraph of Article 5, the service provider which performs sales through an intermediary service provider shall provide the information below on the platform provided by the intermediary service provider prior to commencing electronic commerce activities;

at least one of its commercial name, company name or registered trademark, registered electronic mail address, central registry record number (MERSIS), its headquarter address and approved phone number are maintained by the intermediary service provider.

As per Article 6 of the Regulation, the intermediary service providers are also obliged to provide information as set forth under Article 5 (mentioned above).

Pursuant to Article 6 of the Regulation, the intermediary service providers shall ensure that the service providers comply with their abovementioned obligations prior to commencing electronic commerce activities. However, the intermediary service providers are neither obliged to supervise the content provided by the service providers, nor obliged to check whether there is any illegal activity in relation to the content or goods or services subject to the content.

The obligations of service providers and intermediary service providers as to providing technical information regarding the order process are set forth under Article 7 and 8 of the Regulation.

With respect to the protection of personal data, Article 10 of the Regulation provides that the service providers and intermediary service providers are obliged to protect the personal data obtained by them in relation with their services and to ensure that such personal data cannot be reached illegally.

In conclusion, the Regulation sets forth the obligations of service providers and intermediary service providers as to general information and information to be provided to the consumers prior to the execution of agreement and during the order process on the electronic commerce platform.

Published on: October 2015


Q2/2015 THE CONSTITUTIONAL COURT RULED: “BEING A WELL-KNOWN TRADEMARK IN THE CONTEXT OF ARTICLE 6bis OF THE PARIS CONVENTION DOES NO LONGER CONSTITUTE AN ABSOLUTE GROUND FOR REFUSAL OF REGISTRATION”.

As is known, under Turkish legislation, provisions on protection of trademarks are regulated by the Decree-Law numbered 556 (Published in the Official Gazette dated June 27, 1995 and numbered 22326).

In that regard, pursuant to the abolished Article 7/I(i) of the Decree-Law, if a written sign subject of trademark registration application was a well-known trademark in the context of Article 6bis of the Paris Convention that has not been authorized by its owner, it was an absolute ground for refusal of registration meaning that the Turkish Patent Institute would ex officio take into consideration this issue without need for an objection and would refuse the registration of the relevant sign as a trademark.

Recently, Ankara 3rd Intellectual and Industrial Rights Court applied to the Constitutional Court by alleging that Article 7/I(i) of the Decree-Law is in contradiction with Article 91 of the Turkish Constitution due to the reasons that (i) Pursuant to Article 91 of the Constitution, the fundamental rights listed in the Constitution shall not be regulated by Decree-Laws (ii) There is no doubt that the right of ownership is a fundamental right and pursuant to Article 35 of the Constitution, the right of ownership can only be limited by Law with the aim of public interest (iii) Since the intellectual property rights are also among the rights of ownership as an intangible ownership right, it is not possible to limit the trademark registration right with a Decree-Law (iv) Thus, Article 7/I(i) of the Decree-Law should be abolished.

Further to this application and following its examination on the merits, also the Constitutional Court unanimously ruled by its decision dated May 27, 2015 and numbered 2015/33 E. 2015/50 K. (Published in the Official Gazette dated June 02, 2015 and numbered 29374) that Article 7/I(i) of the Decree-Law is contrary to Article 91 of the Constitution since intellectual property right is an intangible right of ownership; hence, cannot be limited by a Decree-Law. Accordingly, the Constitutional Court abolished Article 7/I(i) of the Decree-Law.

The mentioned decision of the Constitutional Court entered into force as of the date of its publication in the Official Gazette, on June 02, 2015 and being a well-known trademark in the context of Article 6bis of the Paris Convention does no longer constitute an absolute ground for refusal of registration since the decisions of the Constitutional Court are legally binding for all of the real and legal persons including Courts and Official Institutes.

Nonetheless, it must also be noted that the right of the trademark owner to file an objection based on Article 8 of the Decree-Law remains the same and even though the Turkish Patent Institute does not take this matter into consideration ex officio, the trademark owner is entitled to file an objection based on the allegation that his trademark is a well-known trademark and therefore cannot be used in other goods and services.

Published on: July 2015


Q1/2015 The Communique Regarding the Tariff of Fees in the International Arbitration

The Communique Regarding the Tariff of Fees in International Arbitration (the “Communique”) was published in the Official Gazette dated March 4, 2015, numbered as 29285 and entered into force on March 15, 2015.

Pursuant to Article 1, the provisions of the Communique shall apply in cases where the parties and the arbitral tribunal cannot agree on the determination of the fees or if the arbitration agreement does not contain any provisions concerning the determination of the fees or if no reference has been made by the parties in this respect to the established international rules or institutional arbitration rules.

In the event the mandate of one of the arbitrators or the arbitrational tribunal is terminated due to the following reasons specified under Article 7 of the International Arbitration Law (Law No. 4686) (O.G. July 5, 2001), the relevant arbitrator or the arbitrational tribunal shall not be entitled to an arbitrator fee:

if the arbitrator is challenged due to the fact that (i)he does not possess the qualifications that were agreed to by the parties, or (ii) there exists a reason for challenge in accordance with the arbitration procedure agreed by the parties, or (iii) the existing circumstances give rise to justifiable doubts as to his impartiality or independence, if the arbitrator fails to perform his duties without a justifiable reason, if the arbitrator becomes de jure or de facto unable to perform his functions and withdraws from his office or if the parties agree on the termination of his mandate.

The arbitrators are entitled to an arbitrator fee upon the termination of arbitration proceedings and the amount of fee to be paid to the arbitrators shall be determined as follows from the Communique which is in force as of the date of the arbitral award.

The amount of the arbitrator fee shall be determined according to table below and apportioned amongst the arbitrators provided that the chairman’s fee shall be 10% more than the other arbitrators:

Amount   in Controversy

Fee   for Single Arbitrator

Fee   for Three or More Arbitrators

For the first TRY   500,000.00

5   %

8   %

For the following   TRY 500,000.00

4   %

7   %

For the following   TRY 1,000,000.00

3   %

6   %

For the following   TRY 3,000,000.00

2   %

4   %

For the following   TRY 5,000,000.00

1   %

2   %

For the amount   exceeding TRY 10,000,000.00

0,1 %

0,2 %

Published on: April 2015


Q4/2014 The Law Regarding Electronic Commerce

The Law on Regulation of Electronic Commerce numbered 6563 (“E-Commerce Law”) was published in the Official Gazette dated November 5, 2014 and numbered 29166 and will enter into force on May 1st, 2015.

As per Article 1/2, the purpose of the E-Commerce Law is to regulate the developing electronic commerce in Turkiye with provisions regarding the:

commercial communication, liabilities of service providers, agreements made by electronic means, obligations to provide information on electronic commerce, and sanctions.

The service provider (which is described under Article 2 as the individual or legal entity carrying out electronic commerce activities) has an obligation to provide information before the execution of an agreement by means of electronic communication. With this regard, the service provider shall present certain information specified under Article 3 of the E-Commerce Law, which include:

introductory information which shall be up-to-date and comprehensible for the recipients, information on the technical steps necessary for the execution of the agreement, information as to whether the agreement will be preserved by the service provider and whether it will be accessible by the recipient, information on the technical means for the determination and correction of incorrect data entries and the confidentiality rules and information on alternative dispute resolution methods, if any. 

Pursuant to Article 4 entitled “Order”, the service provider shall ensure that the terms and conditions of the agreement, including the total price to be paid could be seen by the recipient at the time of confirmation of the order and prior to the entry of payment information. The service provider shall also confirm the recipient's order through the means of electronic communication without any delay.

As per Article 5 entitled “Guidelines for Commercial Communication”,

the information, which explicitly clarifies (i) the commercial communication and (ii) the individual or legal entity which such communication was conducted on its behalf, shall be submitted and the promotional commercial communications shall contain the indication that such communications are transmitted for promotional purposes and the terms and conditions and participation rules to these promotions shall be accessible and comprehensible.

It should also be noted that,

commercial electronic messages can only be sent with the recipient’s prior consent which may be obtained in writing or via any electronic communication means, the content of the commercial electronic messages shall be in compliance with the consent of the recipient, the recipient can at any time refuse to receive commercial electronic messages without providing any reason, both the service provider and the intermediary service provider are responsible for the preservation and protection of the recipient's personal information obtained within the electronic commerce activities and they are not entitled to use such data for any other purposes and to disclose the same to any other third party without the recipient's consent.

The E-Commerce Law also provides administrative fines under Article 12 amounting up to TRY 15,000 to be imposed on the service providers and the intermediary service providers breaching their obligations under the law.

Published on: January 2015