Edition 26: 2 August 2016
Editorial Team:
Dr. E. Seyfi Moroğlu, LL.M., Işık Özdoğan, LL.M. and Bora İkiler, LL.M.
Turkey Amends Application, Extension and Qualification Aspects of Government Investment Aid Scheme

Turkey has amended various application, extension and qualification aspects of its government investment aid scheme. Supporting documents required during incentive certificate applications have been updated and certified copies are no longer necessary for some registry documents. Foreign solar panels are now excluded from the incentive scheme. Finally, incurring investment expenses is no longer a pre-condition for applying for a time extension. 

The Ministry of Economy introduced changes via the Communique Regarding Changes on the Communique Regarding Application of Government Aid in Investments Decision (“Communique”), published in Official Gazette number 29753 on 25 June 2016, entering into effect on the same date.

Changes introduced by the Communique include:

– During applications for incentive certificates, previous regulations required original, notarized or certified copies of the Turkish Trade Registry Gazette or Turkish Tradesmen and Craftsmen Registry Gazette, indicating the applicant’s current shareholding structure. The Communique states that a non-certified copy of these documents is sufficient.

– “solar panels obtained from abroad” are added to a list of expenses which are not eligible for an incentive certificate.

– Incurring investment expenses is no longer required as a pre-condition for making time extension applications.

– The information and documents which must be obtained from other state institutions and organizations before applying for an incentive certificate (according to the type of the investment listed in Annex-2 of the Communique) have been updated.

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

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Turkey Introduces Database for Electronic Communication Infrastructure Information

Turkey has introduced a new database called the Electronic Communication Infrastructure Information System (“System”), as well as related regulatory requirements for data entry, data auditing, and electronic communication infrastructure. The related Regulation applies to companies which are authorized to provide electronic communication services, networks, or operate related infrastructure. Companies must record their infrastructure, network and service information to the System, as well as ensure the information is accurate and current.

The Information and Communication Technologies Authority (“Authority“) published the Regulation on Infrastructure and Information Systems of Electronic Communication (“Regulation”) in Official Gazette number 29769 on 13 July 2016, effective three months after publication.

Companies exercising rights to lay cables (through public or private property) and networks established for fixed and mobile lines must also comply with Authority’s Reference Document for Electronic Communication Infrastructure Facilities.

The Authority can audit the accuracy of data, as well as companies’ compliance with the Reference Document for Electronic Communication Infrastructure Facilities. At the Authority’s request, companies must enable remote access to their information systems.

Administrative sanctions apply for violations of the Regulation, according to the Regulation on Information and Communication Technologies Authority Administrative Sanctions published in the Official Gazette no. 28914 date 15 February 2014.

The Authority is empowered to issue secondary legislation regarding the System.

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

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Effective Date for Turkish Mining Waste Regulation Extended to July 2017

The effective date for mining waste-management regulation has been postponed in Turkey from 15 July 2016 to 15 July 2017. The Mining Waste Regulation introduces principles for mining waste-management relating to exploration, extraction, enrichment and mine storage activities. It was published in Official Gazette number 29417 on 15 July 2015. Please see this link for further discussion of the Mining Waste Regulation.

More recently, the Regulation Amending the Mining Waste Regulation was published in Official Gazette number 29772 on 15 July 2016. The Amendment Regulation extends the effective date by a further 12 months, to become 15 July 2017.

Please see this link for the full text of Mining Waste Regulation and this link for the full text of the Amendment Regulation on Mining Waste Regulation (both only available in Turkish).

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Turkey Extends Fees for Smart Phones and other Electronic Devices

Turkey has extended the fee payable to the Radio and Television Council to now include all devices which receive radio or TV transmissions via the internet. Previously, the fee only applied to devices which contained internal radio or TV broadcast receivers. Accordingly, 6% banderol fees now apply for cell phones and tablets which receive transmissions via the internet.

The Amendment Decision on Decision (“Decision”) of Law No. 3093 on Radio And Television Council’s Revenue regarding the Decision on Collecting Banderol Fee from Radio, Television, Video and Combined Devices and other Related Devices that Receive Radio Television Transmission (“Amendment Decision”) was published in the Official Gazette on 28 June 2016 with the Council of Minister’s decision No. 2016/8972.

Changes made by the Amendment Decision include:

– Previously, banderol fees only applied to devices which contain internal radio – TV broadcast receivers. The Amendment Decision extends this to include all devices which can receive radio or TV transmission via the internet.

– Cell phones and tablets which can receive radio and television broadcasting via the internet are added to the list announced in the Decision.

– Banderol fees rose from 6% to 7% for cell phones which have an internal receiver.

– 6% Banderol fees apply for cell phones and tablets which receive transmissions via the internet.

– 2% of banderol fees collected by the administration of customs must be transferred from the TRT to the Ministry for Customs and Trade. Previously, the fees were transferred upon the Ministry’s request, via a protocol between TRT and the Ministry.

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

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Turkey Announces e-Government Strategy and Action Plan for 2016-2019

Turkey’s High Development Agency has approved the national e-Government Strategy and Action Plan for the 2016-2019 period (“Strategy and Action Plan”). It aims to enhance the efficiency of e-Government and impove society’s quality of life. The Strategy and Action Plan intends to establish highly integrated, efficient and reliable government and public services.

The Strategy and Action Plan outlines four strategic aims, 13 goals to fulfill these strategic aims and 43 actions to achieve these aims,. These all comply with the e-Government ecosystem overview, which is identified as a strategic focus. Strategic aims and sub-categories include:

– Ensuring the Efficiency and Sustainability of the e-Government Ecosystem

– Increasing coordination efficiency within e-Government operations

– Improving the corporate e-Transformation capacity

– Follow-up of innovative approaches and adopting these to the e-Government ecosystem

– Adopting Common Systems For Infrastructure and Administrative Services

– Developing common IT infrastructures

– Developing disseminating common solutions for e-Government services

– Ensuring unity and sustainability within administrative services information systems.

– Ensuring e-Transformation in Public Services

– Ensuring early and efficient electronic submission of corporate information.

– Enhancing industrial integration in information systems.

– Increasing the maturity level of e-Government services.

– Improving the service procurement channels and enhancing diversity.

– Increasing Use, Participation and Transperancy

– Increasing the use of e-Government services

– Increasing use areas for open data

– Enhancing e-Participation mechanisms

The Strategy and Action Plan was published in Official Gazette number 29775 (second duplicate) on 19 July 2016. Please see this link for full text (only available in Turkish).

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Turkey Introduces Tender Procedures and Limits for Electricity Distribution Companies

Turkey’s energy regulator has introduced regulations for sale-purchase and tender procedures for electricity distribution companies. These include a TRY 20 million upper limit for tenders conducted through a single contract regarding purchases of goods and services, or asset sales. The regulations outline four tender methods for sale-purchase transactions, as well as tender processes for goods, services and sale of assets and services within the framework of electricity distribution activities which are not covered by the Public Procurement Law.

The Energy Market Regulatory Authority (“Authority”) published the Regulation on Preparing and Implementing Sale-Purchase and Tender Procedure for Electricity Distribution Company (“Regulation”) in Official Gazette number 29722 on 25 May 2016, entering into effect on the same date.

The Regulation aims to implement principles such as transparency and reliability for electricity distribution companies during trade.

Key aspects introduced by the Regulation include:

– Four tender methods for purchase and sale transactions, as well as the tender processes for procurement of goods, services and sale of assets and services within the framework of distribution activities. Within this scope:

– Open Tenders: Applicable to all works which do not exceed the upper limit.

– Negotiated Tenders: Applicable to all works which cost less than TRY 1 million and applicants on the short list have been notified at least 7 working days before the tender.

– Direct Supply Method and Sales out of the Scope: Distribution companies can use these methods in case of natural disasters, epidemics, urgent and unexpected situations which may cause loss of property or mortality and these require urgent purchase. Distribution companies make the purchase via market investigation, without a tender process.

– A TRY 20 million upper limit is set for 2016 regarding tenders made through a single contract regarding purchases of goods and, services, or asset sales. The limit will be update annually according to the consumer price index.

– Works which form part of an economic or technical unit cannot be separately tendered.

– Except for construction work, contractors or suppliers who are awarded a tender cannot hire sub-contractors. Additional work increases or decreases cannot exceed 25% of the contract amount.

– Existing framework agreements with terms of more than two years must be terminated by 31 December 2017. Distribution companies must also update their contactor and supplier shortlists by 25 June 2016.

The Regulation does not apply to:

– Rental and purchase of real estate.

– Purchase of goods and services such as electricity, water, gas, phone, meetings, training, accommodation, transportation, medical expenses, advertising.

– Procurement of services within the scope of research and development.

– Purchase of goods and services worth less than TRY 100,000, taking into account the financial and technical integrity of the construction and construction methods.

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

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Turkish Constitutional Court: Expropriated Property Not Used for Expropriation Purposes Violates Property Rights

The Turkish Constitutional Court recently held that property rights had been violated where a Municipality expropriated private property to build a playfield, but later re-zoned the property to become a commercial area and sold the site to a third party via tender. The Court held this to be an unlawful interference with property rights and the prior property owner was entitled to initiate a new trial to rectify the violation’s outcomes.

The prior property owner initiated an action against the municipality, claiming compensation for the difference between the Municipality’s expropriation payment and the land value on the date of filing the lawsuit. The First Instance Court and Court of Appeal dismissed the case. Accordingly, the applicant escalated the matter to the Constitutional Court, claiming violations to his property rights, the right to a fair trial, as well as the principle of equity.

The Constitutional Court considered the merits of the case and ruled that the property rights have been violated and the property owner could initiate a new trial to rectify the results of these violations. The Constitutional Court ruled:

– The expropriated land was not used for the initial expropriation purpose (to build a playing field).

– The expropriated land was not used for the purpose of public interest.

– The process of the land’s conversion to a commercial area and sale to third parties should be assessed as added value. Post-appropriation sale to third parties deprived the applicant of the added value resulting from these sales.

– The area was expropriated within the framework of expropriation transactions and zoning regulations established by the Constitution and other legislation. Accordingly, the Court ruled the expropriation process was conducted without any concrete realization of the public interest, and the expropriation only lead to the property transfer for income generation.

The Constitutional Court gave the decision on 21 April 2016 (application number 2013/6151) published in Official Gazette number 29752 on 24 June 2016. Please see this link for full text of the Constitutional Court’s decision (only available in Turkish).

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Turkish Constitutional Court: Determining Expropriation Values Based on Actual Expropriation Date Violates Property Rights in Price Determination Lawsuits

The Turkish Constitutional Court recently considered which date should be used to assess a property’s expropriation value. It held that for price determination lawsuits, it is unconstitutional to determine a property’s expropriation value based its location and conditions at the actual expropriation date, since the property’s qualities may change between the expropriation date and the lawsuit. Therefore, it held that the phrase “…on the expropriation date…” in the Expropriation Law numbered 2942 (“Expropriation Law”) should be struck out because it violated property rights under Articles 35 and 46 of the Constitution.

In the case at hand, the Court of First Instance filed a complaint to the Constitutional Court, claiming the Expropriation Law violated Articles 35 (property rights) and 46 (expropriation) of the Constitution.

The Constitutional Court ruled that the phrase “…on the expropriation date…” (used to determine expropriation value) violated constitutional property rights and expropriation rules granted under Article 35 and 46. The court held that during expropriations, the period when the administration can bring a lawsuit is ambiguous and the qualities of a land may change between the expropriation date and the lawsuit. Therefore, for price determination lawsuits, it is unconstitutional to determine a property’s expropriation value based its location and conditions at the expropriation date.

Therefore, the Constitutional Court held that legislation should take into account the time difference between the administrative and judiciary processes when determining the expropriation value. Therefore, legislators must remove the phrase “…on the expropriation date…” to accurately determine the date for assessing a property’s expropriation value.

However, the Constitutional Court held that the phrase about not considering the “increase in value and revenue to be generated in the future considering the future use” does not violate the Constitution. It reasoned that property rights protected by Article 35 of the Constitution do not include changes that could occur for immovable property in the future or future expectations that have not yet occurred yet. Therefore, when determining expropriation value, increases caused by zoning and service providers, or possible future revenue, should not be taken into account.

The Constitutional Court’s decision (dated 26 May 2016, with application number 2015/55 and decision number 2016/45) was published in Official Gazette number 29756 on 28 June 2016. Please see this link for the full text of the Constitutional Court’s decision (only available in Turkish).

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Turkish Constitutional Court: Reasoned Decisions Must Include Accurate and Complete Information about Appeal Rights

The Turkish Constitutional Court recently held that Courts must indicate the right to appeal in reasoned decisions, including an accurate validity period. A Commercial Court incorrectly indicated the appeal time as fifteen days, rather than ten days. The Supreme Court subsequently rejected an appeal on the basis that more than ten day has elapsed. The Constitutional Court held that the applicant’s right to access the Court were violated and sent the appeal back to the local court for retrial.

In general, the time available for appeal is fifteen days from receipt of the relevant decision. However, decisions related to administration of bankruptcy’s decisions are an exception, where the time period becomes ten days (Article 164(2), Enforcement and Bankruptcy Law).

In this case, the Commercial Court failed to indicate the time for appeal in its short decision, then indicated an inaccurate time in its later reasoned decision (incorrectly stating 15 days, rather than ten).

The Constitutional Court held that the applicant’s right to access courts was violated and the matter should be sent back to the lower court for retrial. The Constitutional Court noted:

– Courts must indicate the right to appeal and its validity period accurately in decisions.

– It is rational and acceptable for applicants to trust the appeal period indicated in the Court’s decision.

– Strict interpretation of the complicated and disorderly legislation which regulates appeal terms can violate the right to access courts.

– Given the obligation to accurately indicate the right to appeal and validity period, then subsequent strict approach by the Supreme Court, the applicant’s appeal request was unjustly rejected.

The Constitutional Court’s decision (dated 9 June 2016, with application number 2014/819 was published in Official Gazette number 29757 on 29 June 2016.Please see this link for the full text of the Constitutional Court’s decision (only available in Turkish).

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Turkey Amends Livestock Incentives for 2016, Removes Carnivorous Species

Turkey has amended regulatory livestock incentives for 2016, increasing the amount available for calves and removing incentives previously available for carnivorous species. Ongoing incentive applications which were made before 1 January 2016 will be considered according to a prior Communique (No: 2015/17), which has now been abrogated.

The Ministry Of Food, Agriculture And Livestock published the Communique on Application Principles of Livestock Incentives (No: 2016/26) in Official Gazette number 29752 on 24 June 2016.

The incentive scheme generally aims to encourage Turkey’s agriculture and livestock policies by:

– Developing the livestock sector.

– Improving healthy breeding and maintaining sustainability.

– Protecting and improving local breeds’ genetic resources.

– Improving accuracy and actuality of recording systems for the livestock sector.

– Improving the efficiency of livestock policies.

– Supporting local breeders against animal diseases.

The Communique enters into effect from 1 January 2016. Please see this link for the full text of the Communiqué (only available in Turkish).

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Turkey Agrees to Commit $4 Million Annually Towards Supporting Food, Agricultural and Forestry Issues in Central Asian Countries

Turkey has ratified a supplementary agreement to strengthen the Food and Agriculture Organization Subregional Office for Central Asia (“Subregional Office”) on 6 June 2016 (“Agreement”). Under the new commitments, Turkey will provide a total of USD 4 million annually to trust funds addressing hunger, poverty, sustainable agriculture, food safety and forestry issues in specified Central Asian countries. Beneficiary countries are Azerbaijan, Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan and Uzbekistan. The Agreement strengthens and extends the Subregional Office’s scope, as well as aims to reinforce Turkey’s partnership with both the Food and Agriculture Organization and beneficiary countries.

The Subregional Office was established in Ankara within the scope of the Food and Agriculture Organization Reform Program, under the Host Nation Agreement signed between Turkey and the United Nations in 2006.

According to the Agreement:

– Turkey will now annually provide USD $2 million to a newly established trust fund focused on eliminating hunger and poverty in Subregion Countries, as well as supporting sustainable agriculture and food safety and Turkey’s obligations for these issues. Other countries can also be included, if necessary.

– Turkey will now annually provide USD $2 million to a newly established trust fund focused on forestry issues in the Subregion Countries, such as promoting and supporting sustainable forest, forage and terrains, management of the natural resources, preventing desertification, rural development and Turkey’s obligations for these issues.

The law ratifying the Agreement was published in Official Gazette number 29752 on 24 June 2016. Please see this link for the full text of the Agreement (available in Turkish and English). 

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Turkey Approves 2013 Agreement with Palestine for Mutual Assistance on Customs

Turkey’s Council of Ministers has approved a customs agreement executed between Turkey and Palestine in April 2013. The Agreement Between the Government of the Republic of Turkey and the Government of the State of Palestine on Co-operation and Mutual Assistance in Customs Matters (“Agreement”) was approved on 6 June 2016. It aims to increase compliance with customs legislation and prevent customs crime.

The Agreement was executed to co-operate and assist in preventing, investigating and combating customs offences, on the basis that such offences are prejudicial to the economic, commercial, financial, social and cultural interests of both countries.

The Agreement is made in accordance with the international conventions encouraging bilateral mutual assistance and Recommendations by the Customs Co-operation Council (World Customs Organization). Key provisions include:

– Upon request, either country’s Customs Administration must provide all available information which could help in enforcing customs legislation.

– Upon request, either country’s Customs Administration must provide copies of customs and shipment documents, as well as information on actions which constitute/may constitute an offence against the other country’s customs legislation.

– If a country does not have the requested information, it must take the necessary steps to obtain such information.

– Upon request, a country’s Customs Administration must (within competence and available resources) conduct checks of

– Persons who are known or suspected to have committed offences against customs legislation

– Goods which are known or suspected to be subject to customs offences

– Transport methods known or suspected of being used for committing customs offences.

– Customs Administrations must (in cooperation with related ministries) provide each other with all relevant information on action which constitutes (or may constitute) an offence against the other country’s customs legislation regarding illicit traffic of sensitive goods such as weapons, missiles, explosive and nuclear materials. Transferring this information to third parties is prohibited.

– Upon request, a country’s Customs Administration shall investigate acts which constitute (or may constitute) an offence against the other country’s customs legislation.

– Information and documents received under this Agreement can only be used during administrative, investigative and judicial proceedings and must not be used for purposes other than those specified under the Agreement.

– A Customs Administration can refuse to cooperate if it believes that such assistance would infringe upon the sovereignty, security or any other essential interest of its state, or would be inconsistent with domestic laws.

– The Customs Administrations, by a mutually agreed program, will provide each other with technical assistance for training of customs officials and exchange of experts in customs matters.

– The Agreement is executed for an indefinite period. Either Party may terminate this Agreement by written notice through diplomatic channels.

Please see this link for the full text of the Agreement.

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Turkey Expands Air Transport Agreements to Include Five More Countries

Turkey has ratified Air Transport Agreements with the Republic Of Côte d’Ivoire, Republic of Benin, Republic of Rwanda, Central African Republic and Jamaica (“Agreements”). Turkey’s president adopted relevant decisions on 6 June 2016, expanding the scope of existing air transfer arrangement between Turkey and each of these countries.

The Agreements expand and ease opportunities for international air transfer services, as well as address safety and security in international air services. The agreements acknowledge that effective and competitive international air transport services create economic growth and increase trade, tourism, investments and welfare of consumers. The Agreements also address cargo flights and collaboration within various fields of civil aviation, such as maintenance and education.

All countries involved had already signed the International Civil Aviation Agreement and International Air Transfer Agreement on 7 December 1944 in Chicago.

Please see the links below for the full text of each agreement in English and Turkish, including a complete list of countries which have executed Bilateral Air Transport Agreement with Turkey.

– Republic of Côte d’Ivoire

– Republic of Benin

– Republic of Rwanda

– Jamaica

– Central African Republic

– List of the Countries

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Turkey Updates Technical Details of Regulations for Metering and Measuring Instruments

Turkey has updated technical details of the regulatory regime for measuring instruments, including their use and market-entry. The updated rules apply to meters for electricity, gas, heat flow, water and taxis, as well as weighing instruments, among others. These include detailed obligations for commercial operators, manufacturers, importers and distributors.

The Regulation on Measuring Instruments was published in Official Gazette number 29757 on 29 June 2016 (“Regulation”), entering into force on the same date.

The Regulation applies to:

– Water meters.

– Gas meters.

– Volume conversion devices.

– Electrical energy meters.

– Heat flow meters.

– Dynamic measuring systems perpetually measuring liquid quantities (except water).

– Automatic weighing instruments.

– Taxi meters.

– Material meters.

– Dimensional measuring instruments.

– Exhaust gas analyzers.

Provisions introduced by the Regulation include:

– Areas of use for measuring instruments, applicability to sub-mounting devices, basic necessity, existence in the market and use.

– Detailed obligations for commercial operators, manufacturers, importers and distributors.

– The Ministry appoints bodies to assess conformity.

– Market surveillance and auditing of measuring instruments will be conducted in line with the Regulation on Market Surveillance and Control of the Products.

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

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