Edition 16: 17 February 2016
Editorial Team:
Dr. E. Seyfi Moroğlu, LL.M., Işık Özdoğan, LL.M. and Bora İkiler, LL.M.
Changes to Environmental Impact Assessment Processes and Timelines in Turkey

A time limit of one year has been introduced for the additional period which can be granted to project owners in Turkey to rectify failures to fulfill requirements and undertakings under the Environmental Impact Assessment (“EIA”) process. Also, an ongoing review requirement is introduced for organizations authorized by the Ministry of Environment and Urban Planning who must now provide an update report at certain interval regarding the status of certain projects. The Regulation Amending the Regulation on Environmental Impact Assessment (“Amendment Regulation”) was published in Official Gazette number 29619 on 9 February 2016, entering into force on the same date.

Significant changes introduced by the Amendment Regulation include:

– If the Ministry of Environment and Urban Planning (“Ministry”) finds that a project owner does not fulfill its requirements under the EIA Report or Project Identification File upon obtaining an “affirmative EIA report” or receiving an “EIA is not required” decision, the Ministry can grant additional time to fulfill these requirements. The Amendment Regulation limits this period to one year maximum. Only one such extension is permitted. If undertakings are not fulfilled within the additional time, the investment will be ceased.

– The definition of “organizations authorized by the Ministry of Environment and Urban Planning” has changed. At certain intervals, these organizations must review the compliance of the project owners with their obligations under their “affirmative EIA report” and inform the Ministry about the developments in the projects within their construction period.

– Related municipalities and headmen will make loudspeaker announcements about the EIA process for prospective projects at the place(s) where the potentially affected persons live.

– A written announcement about a prospective project’s EIA process must be put on the wall of the building of the related municipality, headman or village council, located at the place(s) where the persons which will/might be affected by such project.

– The Article 24(1)(f) in relation to capacity increases has been cancelled. A new Article 27/A has been introduced. The new article states that a communiqué will be issued to determine procedures and principles in relation to extensions and capacity increases for projects which have been granted an affirmative EIA report or received an “EIA is not required” decision.

Please see this link for full text of the Amendment Regulation (only available in Turkish).

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Changes to Cosmetics Regulations in Turkey

Changes have been made to Turkey’s cosmetics regulations. In particular, the amendments ban use of benzylidene camphor, as well as change requirements for non-oxidant hair dyes and the relationship between local and European Union legislation with regard to vivisection. The Regulation Amending the Cosmetic Regulation was published in Official Gazette number 29506 on 26 January 2016 (“Amendment Regulation”).

The Amendment Regulation amends certain parts of the Cosmetic Regulation (published in Official Gazette number 25823 on 23 May 2005):

– Additional Article 2 of the Regulation relates to vivisection and previously stated that updates in European Union legislation should be taken into consideration. The Amendment Regulation changes this article so that only updates in related legislation and in scientific and technologic developments should be taken into consideration.

– Benzylidene camphor is banned from use in cosmetics. It is removed from Annex 6 (List of UV Filters that are Permitted for use with Cosmetics) and added to Annex 2 (List of Materials that are Banned from Cosmetics), effective from 18 February 2016.

– Amendments are made for hair dye substances in non-oxidant hair dyes, effective from 10 August 2016 (Annex 3 – List of Materials which Should Not Be Included into Cosmetics, Except Noted Limitations).

Any products which are not compliant with the Cosmetic Regulation must be removed from the market, effective from 16 April 2016.

Please see this link for the full text of the Amendment Regulation (only available in Turkish).

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Procedural Change to Accessing Files Held by Turkish Competition Authority in Ongoing Investigations

A procedural change has been made in Turkey regarding access to files held by the Competition Authority for an ongoing investigation. The Investigation Committee now assesses applications to access such information based on the information supplied in a specific form. The Communique Amending the Communique on Regulation of Right to Access File and Preservation of Trade Secret (“Communique”) was published in Official Gazette number 29610 on 31 January 2016, entering into effect on the same day.

Applicants seeking to access files held by the Competition Authority in an ongoing investigation must accurately and completely complete a form titled “Application Form for Access the File”. The form includes information about persons who will attend the examination, method and reasons for examination, as well as identification of the documents which will be examined.

From now on, the Investigation Committee will evaluate these applications, based specifically on the information submitted in the form (Article 2 of the Communique).

Please see this link for the full text of the Communiqué (only available in Turkish).

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From February 2016, the Official Trademark Bulletin will be Published Twice Per Month in Turkey

From February 2016 onward, the Official Trademark Bulletin (“Bulletin”) will be published twice per month in Turkey. The Bulletin contains new trademark applications. It was previously published in the first half of each month, on the Turkish Patent Institute’s website.

Trademark oppositions must be filed within three months of the date which a trademark application is published in the Bulletin. Therefore, due to the recent changes, opposition deadlines will now fall into the first or second half of the month, according to the relevant Bulletin’s publication date. Interested parties will need to carefully follow deadlines to avoid confusion or loss of rights due to the increased regularity of Bulletin publications.

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Turkish Constitutional Court Rules Right to Fair Trial Breached Where Decision Given Without Addressing Compensation Claims for Gender Discrimination

The Turkish Constitutional Court ruled that a local court breached a petitioner’s right to fair trial by giving a decision, in an employment termination case, without specifically evaluating and discussing the petitioner’s compensation claims regarding gender discrimination. The court ruled that a retrial should be held to eliminate the effects of the breach. The Constitutional Court’s decision was dated 5 November 2015 and published in Official Gazette number 29612 on 2 February 2016.

In the case at hand, the petitioner filed a criminal complaint asserting that her manager at a private company had insulted her. The court upheld the compliant and imposed a judicial fine.

Two days after the criminal complaint, the petitioner’s employment contract was terminated for being incompatible with her manager. The petitioner filed a reemployment lawsuit against her employer.

The local court ruled in favour of her reemployment and the Court of Appeals approved the local court’s decision. The employer chose to pay compensation to the petitioner, rather than reemploy her.

The petitioner filed another lawsuit against the employer, this time claiming compensation on the basis that her employment was terminated due to gender discrimination. She claimed the male manager’s insults had been determined by a court decision, yet his employment had not been terminated while her employment had. The petitioner argued that the sole reason for this was that she is a woman.

The local court dismissed the lawsuit and the decision was approved by the Court of Appeal. The local court ruled that the reemployment lawsuit already removed the action causing inequality and the petitioner is not entitled to claim further compensation based on the same action.

The petitioner filed an application to the Constitutional Court requesting a retrial and claiming breaches of the equality principle and right to fair trial.

The Constitutional Court rejected the claimed breach of equality principle (Article 10 of the Constitution) on the grounds that:

– The petitioner did not submit evidence to prove the termination took place based on gender discrimination

– It was not established how similar the situations of the petitioner and her manager were

– It was not proven whether the employer’s motives in terminating the petitioner’s employment was indeed gender discrimination.

The Constitutional Court accepted the petitioner’s claim regarding breach of her right to fair trial (Article 36 of the Constitution). The Constitutional Court ruled that the local court and the Court of Appeals:

– Failed to evaluate and discuss the petitioner’s claims regarding termination of her employment solely based on gender discrimination in terms of discrimination compensation.

– Failed to establish whether the employer indeed acted contrary to his equal treatment obligation.

– Failed to consider the petitioner’s claims pointing to a specific law stipulating the requirement to pay discrimination compensation independently from other compensation (such as salaries and other deprived benefits) and her claims as to not being reemployed despite the reemployment judgment rendered in her favour.

Accordingly, the Constitutional Court held that, when the trial process is evaluated as a whole, the petitioner’s right to a reasoned decision had been breached. The Constitutional Court ruled that the local court should conduct a retrial should be held to eliminate the effects of the breach.

The full text of the Constitutional Court’s reasoned decision can be found at this link (only available in Turkish).

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Turkish Supreme Court Rules on Continuing Use of Registered Trademark After Termination of Franchise Agreement

The 11th Civil Chamber of the Turkish Supreme Court’s recently published a decision in which it considered a claim that the plaintiff’s trademark was infringed because a retailer continued to use of the trademark after termination of the franchise agreement. The Supreme Court held that such use of the trademark constitutes trademark infringement and an expert’s report is necessary to assess the amount of compensation.

At the First Instance Court, the plaintiff claimed the defendant continued to use its trademark, despite termination of the franchise agreement. It also claimed the defendant’s actions constitute unfair competition, sought prevention of this violation, as well as compensation for pecuniary and non-pecuniary damages.

The defendant claimed its use of the trademark was permitted by the fair use exception (Article 12 of Decree Law No. 556 Pertaining the Protection of Trademarks).

The Court of First Instance accepted the plaintiff’s claims. It ruled that the defendant had continued to use the plaintiff’s trademark as if there was a continuous organic link between parties and the defendant has failed to act as a prudent merchant by failing to make efforts to discontinue use of the trademark. The lower court noted that the defendant’s continuing use of the trademark after termination of the franchise agreement constitutes trademark infringement and unfair competition, even if sale of the remaining original goods is legal. The defendant appealed the decision to the Supreme Court.

The Supreme Court held that sale of remaining goods, which were obtained within the scope of the franchise agreement, does not constitute trademark infringement nor unfair competition. Accordingly, it held that the profit obtained through such infringing use of the trademark should be determined with an expert witness report.

The Supreme Court overturned the lower court’s decision on the basis that the Court of First Instance’s examination was incomplete due to the absence of the expert witness report. Accordingly, the Supreme Court held that the Court of First Instance must re-consider the amount of pecuniary and non-pecuniary compensation once such a report is obtained.

Case reference: Yarg. 11. HD. 16.12.2014, 2014/911 E., 2014/19859 K.

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Turkish Supreme Court Rejects Legal Challenge to Omnibus Bill Amending Tax Procedure Code and Social Security Code

The Turkish Supreme Court has rejected a claim by 121 Members of Parliament, seeking to cancel the Omnibus Bill, numbered 6518, amending Ministry of Family and Social Policies’ Statutory decree and some acts and statutory decrees, enacted on 19 February 2014. The Supreme Court’s decision (dated 8 December 2015, numbered 2014/87 E., 2015/112 K.) rejects the cancellation request regarding the Omnibus Bill, which introduced changes to the Tax Procedure Code and Social Security Code, among others.

Tax Procedure Code 

The Omnibus Bill amended Article 257 of the Tax Procedure Code. The article requires tax payers to have no outdated debt in order to obtain the necessary barcode, stamp, clippings and alike for maintaining commercial activity. The claimant requested cancellation of this article on the basis that it restricts the rights of private enterprise, which are protected by the Turkish Constitution. It also claimed that granting discretion to the Ministry of Finance to decide the thresholds for applying or waiving the obligation is a transfer of legislative power.

The Supreme Court rejected the claims, ruling that the restriction under Article 257 is not unconstitutional and the Ministry of Finance is entitled by law to make such arrangements.

Public Procurement Code 

The Omnibus Bill amended Article 38 of the Public Procurement Code. The claimant requested cancellation of this article on the basis that it unconstitutionally grants discretion to public procurement commissions to determine the criteria for “extremely low bids”.

The Supreme Court rejected the claims, ruling that public procurement commissions are competent to determine the criteria for extremely low bids.

Social Security Code 

The Omnibus Bill adds a new clause to Article 30 of the Social Security Code. The new clause states that assistant general managers in the central organization and as provincial directors who work for the provincial directors for at least three years may be appointed as Social Security Specialists.

The claimant requested cancellation of this article on the basis that the new clause might cause inequality. The claimant argued that the government may abuse this power by making biased appointments, causing inequality in the legal appointments and harming vested rights.

The Supreme Court rejected the claim, ruling that the article is not biased and will not generate inequality.

Code Regulating Internet Publications and Suppression of Crimes Committed by Means of Such Publication 

The Omnibus Bill amends various articles in the Code Regulating Internet Publications and Suppression of Crimes Committed by Means of Such Publication.

The claimant requested cancellation of these amendments on the basis that the articles are unconstitutional because they violate the right of privacy and the restrictions do not comply with democratic society. The Supreme Court rejected the claim, ruling that the restrictions not unconstitutional.

Please see this link for the full text of the Supreme Court’s decision (only available in Turkish). 

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Turkish Court of Appeal Rules Damages Arising From Bad Faith Trademark Registration Must be Compensated After Invalidity Decision

The Turkish Court of Appeal’s 11th Chamber recently published a case in which it considered a claim about the enforceability of rights arising from a bad faith trademark registration (2013/17104 E. 2014/14018 K.). The court held that if a trademark registration was clearly made in bad faith and the trademark has been invalidated by a court decision, the invalidity decision will have retroactive effect. Therefore, it held that all pecuniary damages which accrued due to the bad faith registration must be compensated.

In the case at hand, the plaintiff is a foreign company which operated in Turkey through an exclusive agency agreement with the defendant. After the commercial relationship failed, the defendant registered the plaintiff’s commercial name as a trademark with the Turkish Patent Institute.

At the First Instance Court, the plaintiff claimed invalidity of the trademark registrations. It also claimed the defendant’s actions constitute unfair competition, sought prevention of this violation, as well as compensation for pecuniary and non-pecuniary damages.

The First Instance Court rejected the plaintiff’s claims, stating the rights arising from a trademark registration are legally valid. Therefore, the court held that the defendant’s actions did not constitute unfair competition.

The plaintiff appealed the decision to the Court of Appeals. The higher court overturned the First Instance Court’s decision in the plaintiff’s favor.

The Court of Appeal noted previous decisions exist which state that trademark usage after their due registration will not constitute unfair compensation. However, the Court of Appeal gave decisive weight to a decision (considering industrial designs) which stated (Assembly of Civil Chambers, No.11-209/399, 27 March 2013):

– Invalidity decisions have a retroactive effect.

– A legal order does not protect misuse of a right.

– A person must not claim that he was acting with good faith, if he has not shown the attention which was expected from him.

The Court of Appeal noted that under Article 44 of the Decree Law No. 556 on Protection of Trademarks, if a trademark has been invalidated by a court decision, the invalidity decision has retroactive effect.

Accordingly, the Court of Appeal held that the legal rights acquired from the registered trademark cannot be protected due to the defendant’s bad faith. As a result, the defendant was required to compensate the plaintiff’s damages which accrued from the invalid trademark registration.

Case Reference: Yargıtay 11. HD 2013/17104 E. 2014/14018 K.

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