Turkey: The Role And Liabilities Of The Private Sector In Combatting Foreign Bribery In Turkey

Last Updated: 28 January 2015
Article by Burcu Tuzcu Ersin, LL.M. and Bora İkiler, LL.M.

The OECD Convention on Combatting Bribery of Foreign Public Officials in International Business Transactions (the "OECD Anti-Bribery Convention") establishes legally binding standards to criminalize bribery of foreign public officials in international business transactions and provides for a host of related measures that make this effective. It is the first and only international anti-corruption instrument focused on the 'supply side' of bribery transaction. 34 OECD member countries and 7 non-member countries, namely Argentina, Brazil, Bulgaria, Colombia, Latvia, Russia, and South Africa, have adopted the OECD Anti-Bribery Convention1.

Turkey signed the Convention on 17 December 1997 and deposited the ratification instrument with the OECD on 1 January 2000. On 2 January 2002, Turkey enacted implementing legislation in the form of the "Amendment to the Law regarding Prevention of Bribery of Foreign Public Officials in International Business Transactions" No: 4782 of 2 January 2003, which entered into force on 11 January 2003. In order to meet the requirements of the OECD Anti-Bribery Convention, Turkey established criminal liability for the active bribery of a foreign public official through amendments to its legislation, including amendments to the Turkish Criminal Code, Public Procurement Law and Law on Prevention of Money Laundering.

The Working Group on Bribery of the OECD (the "Working Group") evaluated Turkey's performance regarding both legislative compliance and implementation, then submitted its recommendations in three phases which each focused on a different aspect of the OECD Anti-Bribery Convention and involved preparation of a detailed report for each phase. Phase 1 Report (dated November 2004) evaluated the adequacy of Turkey's legislation to implement the OECD Anti-Bribery Convention. Phase 2 Report (dated December 2007) assessed whether Turkey is applying its legislation effectively. In addition to that, a Phase 2bis Report (dated June 2009) and a Follow-up Report on Phase 2 and Phase 2bis Report (dated March 2010) have been published as well. Most recently, Phase 3 Report (dated October 2014) focused on enforcement of the laws implementing the OECD Anti-Bribery Convention and associated instruments.

Phase 4 will focus on detection, enforcement and corporate liability, as well as other major topics relevant to adequate implementation of the obligations arising from the OECD Anti-Bribery Convention. Phase 4 will obviously take a more tailored approach, focusing more closely on the specific enforcement situation in each country.

Beyond the shadow of a doubt, the Turkey's progress shown in the Phase 3 Report is far from satisfactory. Although the Working Group welcomes Turkey's efforts to improve its foreign bribery offence, it remains seriously concerned about Turkey's low level of enforcement of foreign bribery, as well as certain aspects of Turkey's corporate liability legislation.

This Article focuses on the liabilities and role of private sector legal entities and enterprises vis-à-vis the requirements of the OECD Anti-Bribery Convention on the brink of Phase 4. It also aims to provide these entities and enterprises with the necessary nuts and bolts for compliance programs and other good practices which are set forth in international guidelines and key recommendations.

Liabilities of the Private Sector Actors

Article 1 of the OECD Convention defines foreign bribery as offering, promising or giving any undue pecuniary or other advantage, whether directly or through intermediaries, to a foreign public official, for that official or for a third party, in order that the official act or refrain from acting in relation to the performance of official duties, in order to obtain or retain business or other improper advantage in the conduct of international business. Foreign bribery offence is regulated under Article 252 of the Turkish Criminal Code numbered 5237 and dated 12 October 2004 ("TCC") as follows:

In the event that (a) the elected or appointed public officials in a foreign state, (b) the judges, jurors or other officials working for international or supranational courts or foreign courts, (c) international or supranational parliamentarians, (d) the persons carrying out a public activity for a foreign country including public institutions and public enterprises, (e) the national or foreign arbitrators assigned within the framework of the arbitration procedure applied for the settlement of a legal dispute, (f) the officials or representatives of international or supranational public organizations established on the basis of an international agreement directly or through intermediaries, are provided, offered or promised any undue advantage, or request or accept such undue advantage in order to act or refrain from acting in the exercise of their duties or to secure or preserve a business activity or any undue advantage due to international commercial transactions, the provisions of the Article 252 of the TCC which regulate penalties for bribery shall be applied.

Liability of legal persons in Turkey regarding foreign bribery is established by the Article 43/A of the Code of Misdemeanors numbered 5326 and dated 31 March 2005 (the "CM"), which also applies to civil legal persons. Civil legal persons include private law legal persons, which include associations, foundations, unions, confederations, political parties, commercial companies (collective, limited, commandite and joint stock companies) and attorney partnerships. However, companies that are over 50% state-owned are audited by the Court of Accounts and fall outside the remit of Article 43/A of the CM.

As per Article 43/A of the CM, where the act does not constitute a misdemeanor which requires more severe administrative fines; in case that an organ or a representative of a civil legal person; or; a person, who is not the organ or representative, but undertakes a duty within the scope of that legal person`s operational framework commits the foreign bribery offence to the benefit of that legal person, the legal person shall also be penalized with an administrative fine of TL 10,000 to TL 2,000,000.

Since legal persons cannot be held criminally liable under Turkish law, they can only be held administratively liable. In addition to the abovementioned administrative fine, other sanctions may also be applied to legal persons in case of a foreign bribery, such as (i) confiscation of the bribe (property used for committing an intentional offence) regulated under Article 54 of the TCC, (ii) proceeds of bribery (material gain obtained through the commission of an offence) regulated under Article 55 of the TCC, (iii) debarment and prohibition from receiving public subsidies regulated under Article 11 of the Public Procurement Law numbered 4734 and dated 22 January 2002 and (iv) dissolution of the entity by revoking the operating license of a legal entity as a special security measure regulated under Article 60 of the TCC.

The level of authority of the natural person whose conduct may trigger corporate liability should be interpreted broadly. Therefore, any employee of a company may trigger corporate liability, regardless of his/her position, seniority, type of functions, part time/full time employee status, etc.

It is also noteworthy to mention the Working Group's concern, emphasized in the Phase 3 Report, that a criminal procedure must be initiated against a natural person for the case to be brought before the criminal courts. The Turkish criminal courts are unable to hear a case solely seeking to establish the administrative liability of a legal person, as provided under article 43/A of the CM2.

Accounting Requirements for Companies

Through integration of the international standards on auditing and financial reporting into the Turkish national legislation and establishment of the Public Oversight, Accounting and Audit Standards Authority (Kamu Gözetimi Kurumu - the "KGK") in 2011, Turkish law introduced a reporting obligations on external auditors to report not only up the management chain, but also directly to law enforcement authorities under certain situations.

Moreover, Article 359 of the Tax Procedure Code numbered 213 and dated 10 January 1961 (the "TPC") regulates the false accounting offence and the sanctions imposed for false accounting. Furthermore, the Capital Market Board set additional criteria which independent auditors must meet for auditing publicly held joint stock companies and capital market institutions. The sanctions for accounting offences under Turkish law target the accountants more than the companies. However, integration of the international standards on auditing and financial reporting into the legislation now require accountants as well as companies to be more careful on foreign bribery issues. This is because auditors are now obliged to directly inform law enforcement authorities about any foreign bribery matters.

The Role of Companies in Combatting Foreign Bribery

The government is the primary authority responsible for improving Turkey's ability to fight foreign bribery is the government. The government has the executive power to amend legislation in compliance with the OECD Anti-Bribery Convention, as well as the authority to provide training resources to the police, prosecutors and judges. However, companies themselves should shoulder some portion of this responsibility as well.

Private sector actors may both take initiatives on an individual basis, by establishing and implementing proportionate and solid corporate compliance programs within their own organizations and by planning and taking part in collaborative efforts between government, private sector and civil society to leverage and improve corruption standards and practices, identified as weak, and to cultivate a business culture to fight corruption. Under Turkish laws, none of the abovementioned initiatives are compulsory. There is no statutory obligation for companies to establish compliance programs. A notable exception is the requirement to create a compliance program imposed primarily on financial institutions, which must comply with anti-money laundering and counter-terrorist financing obligations within the scope of the Regulation of Programme of Compliance with Obligations of Anti-Money Laundering and Combating the Financing of Terrorism dated 16 September 2008 ("RoC"). Not surprisingly, this is among the areas which the Phase 3 Report criticizes Turkey and recommends the jurisdiction to increase its awareness-raising activities in the private sector about the importance of developing and implementing internal controls and corporate compliance programs regarding anti-bribery.

I. Establishing and Implementing Corporate Compliance Programs

For an effective fight against corruption, it is important to establish a clearly articulated, visible and proportionate corporate compliance policy, which prohibits any and all kinds of corruption, including foreign bribery. Incorporation of a system for financial and accounting procedures is also essential for accomplishing the expectations of an established corporate compliance program. The system should include internal controls and be reasonably designed to ensure the maintenance of fair and accurate books, records, and accounts, to prevent these being used for the purpose of foreign bribery, or hiding such bribery.

The Good Practice Guidance on Internal Controls, Ethics and Compliance adopted on 18 February 2010 by the OECD Council (the "OECD Compliance Guidance") is an integral part of the Recommendation of the Council for Further Combatting Bribery of Foreign Public Officials in International Business Transactions (dated 26 November 2009). The OECD Compliance Guidance is intended to serve as a non-legally binding guide for companies regarding establishment of effective internal controls, ethics, and compliance programs, or measures for preventing and detecting foreign bribery3. The OECD Compliance Guidance is one of the most comprehensive and systematic guidelines publically available.

The OECD Compliance Guidance underlines the importance of addressing a company's individual circumstances (such as its geographical and industrial sector of operation and the vulnerability of these to corruption) during creation of effective internal controls, ethics, and compliance programmes or measures. A good corporate compliance program should involve regular monitoring and re-assessment of its circumstances. It should also adapt itself as necessary to ensure its sustainable effectiveness at achieving its purpose.

Strong commitment from senior management to the company's corporate compliance program encourages the compliance of employees and business parties involved with the company. Such commitment has a major effect on the overall success of the program through-out the organization.

In accordance with the OECD Compliance Guidance, a solid corporate compliance program destined to fight corruption is recommended to include the following processes, among others:

  1. Dissemination of clear and to-the-point written policy materials vis-à-vis persons within and outside the organization,
  2. Systematic and regular trainings,
  3. Creation of contractual obligations in employment contracts, as well as contracts entered into by business partners and counterparts,
  4. Establishing self-reporting and whistleblowing mechanisms,
  5. Performing a risk based4 due diligence while entering into and maintaining relations with business partners and counterparts. These include third parties such as agents and other intermediaries, consultants, representatives, distributors, contractors and suppliers, consortia, and joint venture partners,
  6. Performing a risk based due diligence while establishing joint-ventures and acquiring business entities outside the organization.

Corporate compliance programs should also ensure compatibility with the relevant and applicable laws. Due to the intricacies of any relevant applicable law, the suggestions in a non-binding compliance program require detailed and diligent legal review and analysis before being put in place. Accordingly, to avoid complications during the implementation process it is essential to explicitly state a compliance program in detail, within the framework of the requirements and restrictions of the applicable law. 

Having that said, any corporate compliance program implemented by any entity doing business in Turkey must conform with Turkish laws. It is also critical for companies which have connections with the United States and which fall within the scope of the United States' Foreign Corrupt Practices Act ("FCPA") as well as those which have connections to the United Kingdom and falls under the scope of application of the UK Bribery Act ("UKBA"), to give due regard to the requirements of these pieces of legislation while establishing and implementing their corporate compliance programs. These are the two major national legislative instruments which has extra-territorial application. The law enforcement authorities in relation to both the FCPA and the UKBA consider the existence of corporate compliance programs as a factor while bringing charges against companies, including as a mitigating factor in reducing any penalties imposed.

II. Taking Part in Collective Action

The individual efforts of companies in fighting against corruption within their own organizations are precious. However, these efforts alone are insufficient to successfully win a whole nation's fight against corruption. In order to ensure an effective fight against corruption, companies should combine their forces, thereby contributing to the solutions required for the fight against corruption.

In the "Collective Action in the Fight Against Corruption", a joint publication produced by members of the World Bank Institute Working Group, collective action is defined as a process of cooperation between various stakeholders, with the aim to jointly counter corruption. It means that companies, governments and civil society organizations join forces in order to guarantee transparency in business; for example, during public procurement processes. The ultimate aim of these joint efforts is to create fair and equal market conditions – a "level playing field" – for all market players, as well as to eliminate the temptations of corruption for all of them5.

Collective action can be initiated and driven through various channels. The available methods range from integrity pacts for individual procurement transactions, to industry specific codes of conduct and compliance pacts. It could also include joint measures implemented as part of a long-term initiative to raise a country's public awareness and tighten up its regulatory system and procurement guidelines. For collective action to be as effective as possible, such activities should involve companies, the public sector, non-governmental organizations and other interest groups working jointly in an industry specific or a country specific context. It is also crucial to examine potential anti-trust aspects in each individual case6.

Companies as well as non-business organizations can be a part of the collective action by becoming members of platforms which bring companies together with other companies, agencies, labour and civil society such as the United Nations Global Compact.


1 http://oecd.org/daf/anti-bribery/oecdantibriberyconvention.htm

2 http://www.oecd.org/daf/anti-bribery/TurkeyPhase3ReportEN.pdf

3 Good Practice Guidance on Internal Controls, Ethics and Compliance, February 2010, OECD Council

4 A higher level of diligence could be required for third parties that are dealing directly with governmental agencies or with business units that are in high-risk industries or highrisk countries.

5 Collective Action in the Fight Against Corruption, Joint publication of the members of the World Bank Institute Working Group

6 United Nations Global Compact, UN Global Compact 10th Principle, 22 August 2011

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Burcu Tuzcu Ersin, LL.M.
Bora İkiler, LL.M.
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions