Dear Business Partners,
The Law numbered 7099 on the Amendments in Certain Laws for the Purpose of Improvement of Investment Environment ("Law") was published in the Official Gazette dated 10.03.2018 and numbered 30356. The Law introduced important amendments regarding fifteen laws, especially regarding the Turkish Commercial Code numbered 6102 ("TCC") and the Law on Movable Pledge in Commercial Transactions numbered 6750 ("Law on Pledge of Movables").
Amendments on TCC, essentially aims to facilitate establishment proceedings of corporations by introducing opportunity of conducting certain transaction before trade registries. Accordingly, the requirement of notary public approval for the signature declarations to be provided by authorized signatories of the companies is abolished. A new requirement introduced foresees that first opening approval of commercial books of joint stock and limited liability companies during incorporation shall be conducted by the trade registries and the opportunity of conducting such transaction before public notaries is abolished. For the incorporation process, the requirement notarial approval for articles of associations is abolished and the principle of execution of such articles of associations before the trade registries is introduced. Additionally, the requirement concerning payment of one fourth of the subscribed capital is abolished for incorporations of limited liability companies.
Amendments on Law on Pledge of Movables introduced certain alterations. It has been regulated that pledges under on Law on Pledge of Movables shall be subject to general provisions concerning immovable pledge in the event that there is no provision under Law on Pledge of Movables on a certain matter. The scope of the assets that can be subject to pledge is expanded; the method of analogy is adopted instead of numerus clausus principle.
Provisions concerning merger and consolidation of the pledged movable assets are abolished and it is stipulated that legal revenues of the movable assets such as interest, insurance and outputs and substitute goods shall be included in the scope of the pledge. The provision regulating the possibility to collect the receivable under the general provisions in the event that secured receivable could not be collected by proceedings stipulated under the Law on Pledge of Movables is abolished. The new regulation stipulates that the receivable may be collected under the general provisions even before applying to the proceedings under the Law on Pledge of Movables. The period of three business days stipulated for revocation of the pledge upon termination of the receivable is expanded to fifteen business days for the creditors of pledge that are subject to foreign law, and to ten business days for the creditors of pledge that are subject to Turkish law.
For detailed information concerning the amendments introduced to the Law on Pledge of Movables, please refer to our Newsletter article named " Certain Amendments Projected for the Code on Pledges of Movables in Commercial Transactions".
Please find the full text of the Law here.
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.
