Newsletter & Legal Alerts

Turkish Residents to Notify The Central Bank of their FX Positions

In line with the recent amendments to the Decree No. 32 on Protection of the Value of Turkish Currency (“Decree No. 32”), the Central Bank of the Republic of Turkey (“CBRT”) has enacted the Regulation on the Principles and Procedures regarding the Monitoring of Transactions Affecting Foreign Exchange Position by the Central Bank of the Republic of Turkey (the “Monitoring Regulation”) (published in the Official Gazette dated February 17, 2018 and numbered 30335) with a view to enable the CBRT to monitor the foreign exchange positions (“FX Positions”) of Turkish resident individuals and legal entities.

Published on: February 2018
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Regulation on Data Controllers’ Registry has entered into force and the Board of Protection of Personal Data subsequently announced expected next steps with respect to establishment of Data Controllers’ Registry and data controllers’ obligation to register

As is known, Article 16/2 of Law on Personal Data Protection (Law No. 6698) (published in the Official Gazette dated April 7, 2016 and numbered 29677) (“Data Protection Law”) stipulates that real or legal persons, who process personal data, shall be registered before the data controllers’ registry (“Data Controllers’ Registry”) prior to commencing personal data processing and Article 16/5 provides that procedures and principles regarding Data Controllers’ Registry will be determined by a regulation.

Published on: February 2018
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New Restrictions in the Turkish Foreign Exchange Legislation on Foreign Currency Loans

A decree and a communiqué amending the Decree No. 32 on Protection of the Value of Turkish Currency (published in the Official Gazette dated August 11, 1989, No. 20249) issued by the Council of Ministers under the Law No. 1567, (the “Decree No. 32”) and the Communiqué on Decree No. 32 on Protection of the Value of Turkish Currency (published in the Official Gazette dated February 28, 2008 and numbered 26801) (“Communiqué No. 2008-32/34”), are published by the Council of Ministers in the Official Gazette dated January 25, 2018.

Published on: January 2018
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Türk Yabancı Para Mevzuatında Döviz Kredilerine İlişkin Yeni Sınırlamalar

Bakanlar Kurulu tarafından 1567 sayılı Kanun uyarınca düzenlenen Türk Parası Kıymetini Koruma Hakkında 32 Sayılı Karar’da (11 Ağustos 1989 tarihli ve 20249 sayılı Resmi Gazete’de yayınlanmıştır) (“32 Sayılı Karar”) ve Türk Parası Kıymetini Koruma Hakkında 32 Sayılı Karara İlişkin Tebliğ’de (28 Şubat 2008 tarihli ve 26801 sayılı Resmi Gazete’de yayınlanmıştır) (“2008-32/34 Sayılı Tebliğ”) değişiklik yapılmasına ilişkin Bakanlar Kurulu kararı ve buna ilişkin tebliğ 25 Ocak 2018 tarihli Resmi Gazete’de Bakanlar Kurulu tarafından yayınlanmıştır.

Published on: January 2018
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Q4/2017 Increase in the Monetary Thresholds Regarding the Jurisdiction of Consumer Arbitral Committees

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 “Communiqué”) was published in the Official Gazette dated December 31, 2017 and numbered 30287 and entered into force on January 1, 2018.

Under the Communiqué, consumers are obliged to apply to the consumer arbitral committees regarding disputes arising from the purchase of goods or services other than for commercial or professional purposes if the subject matter of the dispute is inferior to the thresholds provided under Article 3;

  • The threshold for applying to district consumer arbitral committees is TRY 4,570.00.-,
  • The threshold for applying to provincial consumer arbitral committees in metropolitan municipalities is from TRY 4,570.00.- to TRY 6,860.00.-,
  • The threshold for applying to provincial consumer arbitral committees in the provinces which do not have the status of metropolitan municipality is TRY 6,860.00.-,
  • 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 from TRY 4,570.00.- to TL 6,860.00.-

Under 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 about 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 the lawsuits (where the amount of subject of the dispute is less than the above thresholds) filed before consumer courts and request a 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: December 2017


Q4/2017 Energy & Natural Resource

  • Regulation on Natural Gas Market License (published in the Official Gazette dated October 7, 2002 and numbered 24869) (“Regulation”) has been amended. The amended articles have been published in the Official Gazette dated October 31, 2017 and numbered 24869. Under Article 3 of the Regulation, the minimum share capital amounts for a legal entity to obtain license have been revised. Please see below for the license type and the minimum share capital amount now required for a license:
     

License Type

Minimum Share Capital (TRY)

Storage / Transmission

27,100,000

Importation

5,410,000

Wholesale

5,410,000

Exportation

2,850,000

Distribution

1,360,000

 

  • Regulation on Electricity Market Ancillary Services has been published in the Official Gazette dated November 26, 2017 and numbered 30250. Under Article 5 of the Regulation, services used by the system operator to provide operational security and system integrity services are to be informed to Turkiye Elektrik Iletim A.S.
     
  • Regulation on the Audit of Electricity Distribution Companies has been published in the Official Gazette dated December 2, 2017 and numbered 30258. The regulation sets forth the principles and obligations of relevant parties in relation to auditing electricity distribution companies.
     
  • Regulation on the Electricity Market (published in the Official Gazette dated November 2, 2013 and numbered 28809) has been amended. The amended articles have been published in the Official Gazette dated December 15, 2017 and numbered 30271 (“Regulation”). According to Article 43 of the Regulation, for the extension of the completion period of the electricity generation facility, the amount of the license purchase fee is to be taken as the license amendment fee.
     
  • Regulation on Petroleum Market License (published in the Official Gazette dated June 17, 2004 and numbered 25495) has been amended. The amended articles have been published in the Official Gazette dated December 20, 2017 and numbered 30276 (“Regulation”). Under Article 50 of the Regulation, the income share is to be paid to the oil refinery's income share account and owners of the refinery license are obliged to collect income share from fuel-oil sales. In addition, license owner companies are obliged to notify their registered electronic mail address (“KEP”) and to ensure that KEP addresses are valid and active.

    Regulation on Packaging Waste Control has been published in the Official Gazette dated December 27, 2017 and numbered 30283 (the “Regulation”). According to 15 of the Regulation, it is prohibited to produce, supply or import packaging that is not suitable for recycling. Additionally, suppliers are obliged to choose the right package for recovery, to register to Package Information System to be established and to make notifications about package.

Published on: December 2017


Q4/2017 Amendment to the Regulation on the Procedures and Principles Regarding Fees to be Collected from Financial Consumers

The Banking Regulation and Supervision Agency (“BRSA”) amended the Regulation on the Procedures and Principles regarding the Fees to be Collected from Financial Consumers (published in the Official Gazette dated October 3, 2014 and numbered 29138) on December 23, 2017.

The amendment provides for an upper limit for fees charged (“Service Fee”) in return for transactions performed by financial consumers via third party ATMs (i.e. ATMs that belong to any financial institution in Turkey other than the respective financial consumer’s contracted institution at which the financial consumer’s relevant bank account is held (“Account Institution”). As such, the Service Fee is not to exceed 115% of the amount paid by the Account Institution to the third party institution, in return for the services provided via third party ATMs. The amendments also stipulate that the Service Fee will (i) be determined and specified under the framework agreement between the Account Institution and the financial consumer or (ii) be collected with the financial consumer’s consent during the transaction.

Published on: December 2017


Q4/2017 Increase of the Invoice Value to be taken as a Basis for the Determination of a Loan Amount to the Vehicle Value Ratio

For the purpose of revising the limitations in loan amount to be extended to consumers under vehicle loans, asset backed loans secured with vehicles or financial leasing transactions related to vehicles (“Vehicle Financing”), the BRSA amended the Regulation on Loan Transactions of Banks (published in the Official Gazette dated November 1, 2011 and numbered 26333) and the Regulation on the Principles for the Incorporation and Operations of Financial Lease, Factoring and Financing Companies (published in the Official Gazette dated April 24, 2013 and numbered 28627) on December 12, 2017 with immediate effect.

Due to these amendments, the maximum loan under Vehicle Financing will be determined based on the invoice amount for the relevant vehicle. As such, the loan amount is not to exceed 70% of the final invoice amount of the respective vehicle if the final invoice amount is equal to or less than TRY 100,000. If the final amount is over TRY 100,000, the loan amount will not exceed the sum of 70% of the portion amounting to TRY 100,000 and 50% of the remaining portion exceeding TRY 100,000 under the respective invoice amount.

Published on: December 2017


Q4/2017 Amendments to Central Bank Law and Cheque Law

The Law Amending Certain Tax Laws and Other Laws (Law No. 7061) (published in the Official Gazette dated December 5, 2017 and numbered 30261) (the “Law No. 7061”) has introduced certain amendments to the Law on the Central Bank of the Republic of Turkey (Law No. 1211) (published in the Official Gazette dated January 26, 1970 and numbered 13409) (the “CBRT Law”) and the Cheque Law (Law No. 5941) (published in the Official Gazette dated December 20, 2009 and numbered 27438) (“Cheque Law”).

Under the amendments to the CBRT Law, the Central Bank of the Republic of Turkey (the “CBRT”) is granted the authority to request any kind of information and documentation from individuals and legal entities, to be determined at the sole discretion of the CBRT, in order to monitor transactions that would impact the FX positions of the same. The Law No. 7061 stipulates that persons acting in violation of the procedures to be determined by the CBRT for these purposes shall be subject to judicial monetary penalty.

Furthermore, Law No. 7061 has also amended Provisional Article 3 of the Cheque Law.  which prohibits the submission of future-dated cheques to banks for payment. The amendment aims to extend the duration of the prohibition on submission of future dated cheques until December 31, 2020.

Published on: December 2017


Q4/2017 Crowdfunding: a Funding Alternative for Projects and Business Ventures

Crowdfunding is a tool for entrepreneurs to collect funds from a large number of individuals through crowdfunding platforms to finance their projects or business ventures.

Law No. 7061 (published in the Official Gazette dated December 5, 2017 and numbered 30261) which amended the Capital Market Law (Law No. 6362) (published in the Official Gazette dated December 30, 2012 and numbered 28513) (the “Capital Market Law”) paved the way for collecting funds from crowdfunding without being subject to the Capital Markets Board regulations regarding public offerings.

The recently introduced crowdfunding provisions of the Capital Market Law are as follows:

  • “Crowdfunding” is fund-raising from the public by means of crowdfunding platforms in order to obtain funds necessary for a project or a venture company within the scope of the rules to be determined by the Capital Markets Board. The Capital Market Law does not include the definitions of a “project” or a “venture company”. However, it should be noted that, pursuant to the Capital Markets Board Communiqué Regarding Venture Capital Investment Companies No. (III-48.3) (published in the Official Gazette dated October 9, 2013 and numbered 28790) any companies established (or to be established) in Turkey, with a potential of development and need funds, are to qualify as a “venture company”.
  • Fund collection is to be conducted through crowdfunding platforms, which shall intermediate for crowdfunding and are to provide services in an electronic environment.
  • The incorporation and operation of crowdfunding platforms is to be subject to the permission of the Capital Markets Board.
  • The collectors of funds through crowdfunding platforms are excluded from the definitions of “publicly-held company” and “issuer” even in the case where number of shareholders exceeds the 500 limit.
  • Collection of funds through crowdfunding platforms is not subject to the Capital Market Law provisions regarding the compensation of investors and preparation of a prospectus or issuance document.
  • The Capital Markets Board has the power to take all kinds of measures as per Article 96 of the Capital Market Law for unlawful operations and transactions of the crowdfunding platforms.
  • Fund collection is not to be regarded as an investment service or an ancillary service as per Articles 37 and 38 of the Capital Market Law and is not to be subject to Capital Market Law provisions regarding exchanges, market operators, and other organized market places.
  • If fund-raising is conducted with the intermediation of crowdfunding platforms without obtaining the Capital Markets Board’s permission, or cross-border leveraged transactions (or derivative transactions that are determined to be subject to the same provisions as leveraged transactions) are carried out with Turkish residents through the internet, the Information Technologies and Communications Authority is to prevent access to the relevant web-sites upon the request of the Capital Markets Board.
     

Crowdfunding might be a viable funding alternative for new projects and developing businesses since the Capital Market Law Amendments provide a safe harbor for the collection of funds from capital markets without being subject to the heavier regulations of the Capital Markets Board regarding public offerings.

It should also be noted that the regulatory environment would be clearer when the relevant Capital Markets Board communiqué is published and crowdfunding transactions start after crowdfunding platforms become operational upon the permission of the Capital Markets Board.

Published on: December 2017