{"id":124318,"date":"2026-01-09T09:59:57","date_gmt":"2026-01-09T09:59:57","guid":{"rendered":"https:\/\/my.legal500.com\/guides\/?post_type=comparative_guide&#038;p=124318"},"modified":"2026-01-09T09:59:57","modified_gmt":"2026-01-09T09:59:57","slug":"turkiye-acquisition-finance","status":"publish","type":"comparative_guide","link":"https:\/\/my.legal500.com\/guides\/chapter\/turkiye-acquisition-finance\/","title":{"rendered":"Turkey: Acquisition Finance"},"content":{"rendered":"","protected":false},"template":"","class_list":["post-124318","comparative_guide","type-comparative_guide","status-publish","hentry","guides-acquisition-finance","jurisdictions-turkiye"],"acf":[],"appp":{"post_list":{"below_title":"<div class=\"guide-author-details\"><span class=\"guide-author\">Selvi Attorney Partnership<\/span><span class=\"guide-author-logo\"><img src=\"https:\/\/my.legal500.com\/guides\/wp-content\/uploads\/sites\/1\/2025\/12\/Selvi-Attorney-Partnership_Firm-Logo-e1766413310673.jpg\"\/><\/span><\/div>"},"post_detail":{"above_title":"<div class=\"guide-author-details\"><span class=\"guide-author\">Selvi Attorney Partnership<\/span><span class=\"guide-author-logo\"><img src=\"https:\/\/my.legal500.com\/guides\/wp-content\/uploads\/sites\/1\/2025\/12\/Selvi-Attorney-Partnership_Firm-Logo-e1766413310673.jpg\"\/><\/span><\/div>","below_title":"<span class=\"guide-intro\">This country specific Q&amp;A provides an overview of Acquisition Finance laws and regulations applicable in Turkey<\/span><div class=\"guide-content\"><div class=\"filter\">\r\n\r\n\t\t\t\t<input type=\"text\" placeholder=\"Search questions and answers...\" class=\"filter-container__search-field\">\r\n\t\t\t<\/div>\r\n\r\n\t\t\t\r\n\r\n\r\n\t\t\t<ol class=\"custom-counter\">\r\n\r\n\t\t\t\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What are the trends impacting acquisition finance in your jurisdiction and what have been the effects of those trends? Please consider the impact of recent economic cycles, Covid-19, developments relating to sanctions, and any environmental, social, and governance (\u201cESG\u201d) issues.<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>T\u00fcrkiye\u2019s acquisition-finance market in 2025 has reflected the intersection of tightening global credit conditions, domestic macroeconomic policy, and the expanding influence of sustainability-driven regulation. While the United States (US) and European central banks started cutting rates, T\u00fcrkiye maintained comparatively high interest levels to manage inflationary pressures. This environment has kept local-currency borrowing expensive, compelling acquirers to structure transactions through foreign-currency loans, offshore facilities, and club deals among domestic lenders. Acquisition financing has therefore become more collateral-driven and conservative, with shorter maturities, mandatory cash sweeps, and greater reliance on deferred-payment mechanics.<\/p>\n<p>Beyond economics, geopolitics has quietly rewritten term sheets. The continuation of European Union (EU) sanctions against Russia, shipping disruptions in the Red Sea corridor, and evolving tariff measures in global supply chains have transformed compliance from a boilerplate clause into a key credit variable. As a result, Turkish borrowers now face enhanced reporting obligations towards creditors and broader material-adverse-change provisions within their acquisition facilities.<\/p>\n<p>Environmental, social, and governance (ESG) standards have simultaneously moved from aspirational to instrumental. The implementation of the EU\u2019s Carbon Border Adjustment Mechanism has made carbon pricing an essential element of credit analysis for Turkish industrial exporters. Turkish banks and development institutions are answering with green tranches, sustainability-linked margins, and covenant packages that reward credible transition plans.<\/p>\n<p>For the technology and startup ecosystem, acquisition finance has taken a hybrid form. As venture capital has become more selective, strategic investors and corporate venture funds have used a blend of equity infusions and convertible instruments to pursue acquisitions in fintech, AI, and climate-tech. Lenders, while cautious, have shown growing interest in high-growth companies that combine strong governance with credible ESG alignment.<\/p>\n<p>Overall, T\u00fcrkiye\u2019s 2025 acquisition-finance landscape remains active but highly discerning\u2014driven by macroeconomic discipline, regulatory adaptation, and the maturation of sustainability-linked capital markets.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Please advise of any recent legal, tax, regulatory or other developments (including any reforms) that will impact foreign or domestic lenders (both bank and non-bank lenders) in the acquisition finance market in your jurisdiction.<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>The regulatory environment for acquisition finance in T\u00fcrkiye has evolved in parallel with the Central Bank of the Republic of T\u00fcrkiye\u2019s tightening strategy. The initial regulation, announced on 4 January 2025, capped monthly loan expansion at 2.5% for SME commercial loans, 1.5% for other Turkish-lira-denominated commercial loans, and 1% for foreign-currency loans. The purpose was to moderate credit-driven inflation and strengthen balance-sheet discipline across the banking sector. Subsequent adjustments throughout the year further reinforced this policy: the Central Bank of the Republic of T\u00fcrkiye\u2019s 1 March 2025 circular reduced the monthly growth limit for FX loans to 0.5%, while the 16 August 2025 amendment extended the measurement period for loan-growth calculations from four to eight weeks, thereby smoothing short-term volatility. Collectively, these measures have prompted banks to adopt a more selective approach to credit expansion, directly influencing the availability, tenor, and currency mix of acquisition-finance facilities.<\/p>\n<p>Another significant development concerns the treatment of foreign-currency-denominated contracts and loans, a regulatory area that has undergone periodic tightening since the 2018 amendments to Decree No. 32 on the Protection of the Value of Turkish Currency (Decree No. 32), which introduced restrictions on the use of foreign currency between Turkish residents. Under this framework, entering into or performing contracts in foreign currency \u2014 as well as accessing foreign-currency loans \u2014 has been subject to a series of exemptions defined by the Ministry of Treasury and Finance. In practice, mergers and acquisition transactions have consistently fallen within these exemptions, allowing both the share purchase agreement and the corresponding acquisition-finance facility to be denominated in foreign currency, provided that certain regulatory conditions are satisfied.<\/p>\n<p>Previously, however, even when a transaction qualified for such exemptions, borrowers were required to convert the proceeds of foreign-currency loans into Turkish lira before transferring the purchase price to the seller, a rule that created significant operational and hedging challenges in acquisition financings. This restriction was lifted as of 24 January 2025 through Communiqu\u00e9 No. 2025-32\/71, which amended the implementation of Decree No. 32. As a result, purchase prices in share or asset acquisitions can now be settled directly in foreign currency, without mandatory conversion into Turkish lira. The amendment has materially streamlined acquisition-finance transactions, aligning T\u00fcrkiye\u2019s regime more closely with international banking practice and reducing execution risk for all parties.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Please highlight any specific high level issues or concerns in your jurisdiction that should be considered in respect of structuring or documenting a typical acquisition financing.<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>One of the most critical considerations when structuring acquisition finance transactions in T\u00fcrkiye is compliance with the financial assistance prohibition under Article 380 of the Turkish Commercial Code (TCC). This restriction directly affects how lenders, sponsors, and counsel design security packages and corporate support mechanisms in leveraged acquisitions.<\/p>\n<p>Article 380 of the TCC imposes a strict prohibition on a company providing advances, loans or security to a third party for the purpose of acquiring its own shares; such legal transactions are treated as void. This rule is designed to protect the company\u2019s capital and creditors and to prevent the erosion of the target\u2019s asset base through leveraged buyouts. The result for acquisition finance is immediate and concrete: lenders and arrangers must not assume that the assets of the target may be freely deployed as collateral for the buyer\u2019s acquisition loan without triggering the prohibition.<\/p>\n<p>Although the ideal structure is to ensure that acquisition financing is secured by assets other than those of the target company, in practice this may not always be achievable. In such cases, certain carefully designed solutions have emerged in the market, allowing lenders to obtain comfort over the target\u2019s assets without breaching the financial assistance restriction. These structures are highly tailored, often requiring a delicate balance between commercial needs and strict legal compliance.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">In your jurisdiction, due to current market conditions, are there any emerging documentary features or practices or existing documentary provisions\/features which borrowers or lenders are adjusting or innovating their interpretation of, or documentary approach to?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>As new loan facilities continue to become increasingly costly, borrowers are progressively seeking alternative financing solutions to meet their funding needs. These may include derivative transactions (such as sell-buy back arrangements involving their assets or shares in subsidiaries) and public offerings.<\/p>\n<p>Consequently, covenants restricting the disposal of assets or potential public offerings of the borrower or the target company and early repayment provisions triggered by these transactions are becoming more prevalent and are more frequently addressed within loan documentation and sometimes more aggressively negotiated by the borrowers considering potential future operations.<\/p>\n<p>In parallel, as the significance of ESG standards continues to grow, covenants requiring compliance with such standards are increasingly incorporated into loan documentation. As green loan products have become more prominent in the Turkish market, sustainability-related covenants have likewise become common features of loan agreements.<\/p>\n<p>Lastly, as a general trend, loan documentation has become more lender-friendly and conservative due to tight global credit conditions and domestic economic pressures, resulting in a constrained negotiation latitude for borrowers.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Has there been a prevalence of \u201cequity bidding\u201d in acquisition financing (i.e., signing the acquisition agreement prior to securing financing) with the expectation of securing financing shortly thereafter? If in the US, would Xerox language be included in the acquisition agreement?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>As acquisition financing has become more collateral-driven, conservative, and costly due to recent market conditions, acquirers in the Turkish market are increasingly driven to complete their acquisitions primarily with equity. Therefore, equity bidding has recently become a practice that is compelled by prevailing market conditions in the Turkish market.<\/p>\n<p>Accordingly, obtaining acquisition financing can be considered a bonus rather than a necessity for acquirers in the Turkish market. Acquirers typically use the interim period under share purchase agreements to pursue financing for their acquisition. If they fail to secure such financing, they complete the transaction solely with equity.<\/p>\n<p>As a result, there is no fixed or \u2018Xerox\u2019 language incorporated into acquisition agreements to protect potential lenders, since the parties are not certain that financing will be obtained in the first place.<\/p>\n<p>Moreover, it is possible to amend the acquisition agreement after the financing is obtained, should the lenders deem it necessary following their due diligence review.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are there any notable trends in the use of certain financing structures (e.g., private credit vs syndicated vs high yield vs holdco vs mezzanine vs preferred, etc.) in your jurisdiction for acquisition financings?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>As explained in Question No. 1, due to recent economic and market conditions, club deals and syndicated loans have emerged as the most notable trend among lenders in the acquisition finance market. These structures allow lenders to distribute risk, ensure broader participation, and maintain lending capacity despite tightening credit conditions, which explains their increased popularity in the current environment.<\/p>\n<p>Alongside this, from the perspective of acquirors, private credit facilities and other alternative financing methods (such as derivative transactions and shareholder loans) are increasingly preferred over traditional bank loans, primarily because bank financings have become more costly, conservative, and collateral-driven. Private credit providers, on the other hand, often tend to offer more flexible terms, faster execution, and bespoke structuring, which makes them particularly attractive for acquirors operating under time-sensitive or complex deal dynamics.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Has the use of technology (e.g., e-signatures, digital platforms for syndication, document automation, AI, etc.) impacted the documentation or execution of acquisition financings?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>The use of technology in the execution of financing documents is not yet a widely adopted concept within the Turkish legal framework.<\/p>\n<p>Turkish lawmakers continue to take a relatively conservative stance toward electronic signatures compared to other jurisdictions. For instance, commonly used e-signature tools such as DocuSign or Adobe Signature are not recognised as valid means of execution under Turkish legal framework.<\/p>\n<p>Furthermore, under the Electronic Signature Law No. 5070, documents that are subject to specific form requirements cannot be executed electronically, and security documents\u2014except for limited cases such as letters of credit executed by banks\u2014cannot be signed using electronic signatures.<br \/>\nAlthough the use of digital tools in this field has recently attracted increasing attention, there are currently no digital platforms capable of automating complex syndication or acquisition finance documentation to a high professional standard. As a result, such documents are still manually prepared by legal professionals.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What are the legal and regulatory requirements for banks and non-banks to be authorised to provide financing to, and to benefit from security provided by, entities established in your jurisdiction?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>In T\u00fcrkiye, lending activities are regulated under the Banking Law No. 5411 (Banking Law) and the Financial Leasing, Factoring and Financing Companies Law No. 6361. Banks and financing institutions must be licensed by the Banking Regulation and Supervision Agency (BRSA).<\/p>\n<p>Foreign lenders may extend cross-border loans to Turkish borrowers without a local licence, provided that the loan complies with the Central Bank of T\u00fcrkiye\u2019s Capital Movements Circular. However, a foreign bank wishing to operate through a Turkish branch must obtain a branch establishment and operating licence from the BRSA.<\/p>\n<p>Both domestic and foreign lenders may take security over assets located in T\u00fcrkiye. Turkish law permits a full range of security interests subject to the relevant perfection and registration requirements (e.g., land registry or movable pledge registry). There is no general restriction on foreign lenders benefiting from or enforcing Turkish-law securities.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are there any laws or regulations which govern the advance of loan proceeds into, or the repayment of principal, interest or fees from, your jurisdiction in a foreign currency?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>T\u00fcrkiye operates a regulated foreign-exchange regime. The advance and repayment of foreign-currency loan proceeds are primarily governed by Decree No. 32, its implementing Communiqu\u00e9s and the Capital Movements Circular of the Central Bank of the Republic of T\u00fcrkiye.<\/p>\n<p>The restrictions in T\u00fcrkiye primarily relate to the utilisation of foreign-currency loans. As a general rule, Turkish residents may borrow and repay foreign-currency loans only if the transaction complies with these foreign-exchange controls. Turkish-resident entities that do not generate foreign-currency income are restricted from borrowing in foreign currency. Entities with foreign-currency income may borrow up to the aggregate amount of such income earned in the preceding three financial years. There are important exemptions:<\/p>\n<ul>\n<li>Companies that have a total outstanding foreign-currency loan balance is at least USD 15 million (or equivalent) are not subject to the income-based borrowing cap.<\/li>\n<li>The income limitation does not apply to Turkish entities established solely to acquire shares in another company and having no other operating activity.<\/li>\n<\/ul>\n<p>As regards the repayment of interest and fees, there is no specific restriction under Turkish foreign-exchange legislation requiring such payments to be made in Turkish Lira. Where a loan is validly denominated in foreign currency, both principal and all related payments, including interest, fees and other charges, may be freely paid in the same foreign currency. Turkish law does not impose a mandatory conversion of interest or fees into Turkish Lira.<\/p>\n<p>Foreign currency loans sourced abroad may be used offshore without being brought into T\u00fcrkiye. Where the proceeds are transferred onshore, they must be routed through a Turkish intermediary bank, which must also be used for onshore repayments. Offshore repayments are permitted, provided that the intermediary bank is notified.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are there any laws or regulations which limit the ability of foreign entities to acquire assets in your jurisdiction or for lenders to finance the acquisition of assets in your jurisdiction? Please include any restrictions on the use of proceeds.<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Foreign investment in T\u00fcrkiye is primarily governed by the Foreign Direct Investment Law No. 4875, which grants foreign investors national treatment. As a rule, foreign entities may acquire assets in T\u00fcrkiye without prior governmental approval, except for real estate, where foreigners are subject to quantitative limits based on both (i) the total area they may own nationwide and (ii) district-level caps. The President may further restrict or suspend foreign ownership of real estate on grounds of national interest.<\/p>\n<p>There are no general restrictions on foreign or domestic lenders financing asset acquisitions in T\u00fcrkiye. Under the Capital Movements Circular, foreign lenders may freely extend foreign-currency loans to non-residents, while both Turkish and foreign lenders may extend TRY loans subject to their internal lending policies. There are likewise no use-of-proceeds restrictions, aside from compliance with T\u00fcrkiye\u2019s foreign-exchange rules when foreign-currency loans are involved.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What does the security package typically consist of in acquisition financing transactions in your jurisdiction and are there any additional security assets available to lenders?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>In T\u00fcrkiye, acquisition financing security packages are structured around the assets of the acquirer and its group due to the financial assistance prohibition under the TCC, which restricts a company from providing security or guarantees in connection with the acquisition of its own shares. Because of this mandatory rule, the target company cannot grant any form of guarantee or security to support the acquisition financing, and the lenders instead rely entirely on the credit and assets of the acquiring group.<\/p>\n<p>The core security components generally include:<\/p>\n<p>1. Share pledges over the shares of the acquirer and, where structurally feasible, over the shares of intermediate holding entities. A pledge over the target\u2019s shares may also be taken post-closing.<\/p>\n<p>2. Bank account pledges over operating, collection, reserve, and escrow accounts maintained by the borrower group.<\/p>\n<p>3. Assignments of receivables, including commercial receivables, intragroup receivables, and receivables arising under key contracts, perfected through notification to relevant counterparties or account banks.<\/p>\n<p>4. Pledges over movable assets, such as machinery, equipment, inventory, vehicles, and other registrable movables under the Law No. 6750 on Pledge over Movable Property in Commercial Transactions (Movable Pledge Law) through registration in the Movable Pledge Registry System.<\/p>\n<p>5. Mortgages over immovable property, where the acquiring group owns real estate suitable for securing the loan.<\/p>\n<p>6. Corporate guarantees or suretyships granted by solvent group companies, provided they meet Turkish corporate benefit requirements and do not fall foul of the financial assistance rules.<\/p>\n<p>Depending on the nature of the transaction and the asset profile of the borrower group, lenders may also benefit from additional forms of security. These may include pledges over intellectual property rights, assignments of insurance policies and proceeds, security over investment or securities accounts, and pledges over shareholders\u2019 receivables owed by the acquirer or other group companies. In certain structures, lenders may also take an assignment of key project or commercial agreements, particularly in infrastructure or project-driven acquisitions.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Does the law of your jurisdiction permit (i) floating charges or any other universal security interest and (ii) security over future assets or for future obligations?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Under Turkish law, the concept of a floating charge, as developed in common-law jurisdictions, does not formally exist. Turkish secured-transactions law is premised on the requirement that a security interest must attach to specific and identifiable property, and therefore a universal or all-encompassing security interest over a shifting pool of assets cannot be created in a manner analogous to an English-style floating charge. Security must generally be constituted with respect to assets that are either individually identifiable or capable of being determined with sufficient certainty at the time the security is granted.<\/p>\n<p>That said, certain mechanisms operate in a manner that is functionally similar\u2014though not equivalent\u2014to a floating charge. In particular, the Movable Pledge Law significantly broadens the scope of assets over which a pledge may be granted, allowing security over inventory, machinery, equipment, receivables, intellectual property, and various elements of a commercial enterprise. While this regime does not replicate the conceptual underpinnings of a floating charge, it enables the creation of security interests over asset categories that may fluctuate over time, provided that these categories are sufficiently determinable and the pledge is duly perfected through registration with the movable pledge registry.<\/p>\n<p>As to future property and future obligations, Turkish law permits security to be created over assets that do not yet exist and for obligations that will arise in the future, subject to the condition that such assets or receivables are sufficiently determinable and capable of coming into existence. In practice, security may extend to future receivables, after-acquired assets, and future or contingent obligations under financing arrangements, with perfection or enforceability typically occurring once the asset is acquired or the obligation materialises.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Do security documents have to (by law) include a cap on liabilities? If so, how is this usually calculated\/agreed?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Under Turkish law, security documents are not generally required to include a cap on the secured liabilities as a default rule. The general principle is that security interests do not have to specify a maximum secured amount.<br \/>\nHowever, Turkish legislation introduces exceptional cases in which a liability cap must be stated:<\/p>\n<p>(i) Suretyships and personal guarantees given by individuals: Under the Turkish Code of Obligations Law No. 6098, all types of suretyship must be executed in writing as a condition of validity. In addition to this general requirement, where the guarantor is a natural person, Turkish law further requires that the maximum amount of the guarantor\u2019s liability be expressly stated in writing. The explicit indication of this capped liability is a mandatory validity element applicable exclusively to guarantees provided by individuals.<\/p>\n<p>(ii) Security interests that are registered in a dedicated public registry: Certain types of collateral\u2014such as mortgages over immovable property and movable pledges registered under the Movable Pledge Law\u2014require a maximum secured amount to be recorded because the security is perfected through registration in their respective registries. Accordingly, an express cap is mandatory for mortgages and registered movable pledges.<\/p>\n<p>(iii) Market-driven exceptions: In practice, some institutions [notably Energy Exchange Istanbul (EXIST)] require the secured amount to be specified in receivables assignment agreements forming part of their collateral arrangements. This is not a statutory requirement, but a contractual\/operational requirement imposed by the relevant market operator.<br \/>\nApart from these categories, other types of collateral\u2014such as account pledges, share pledges, intellectual property pledges, vehicle pledges, guarantees issued by legal entities, and receivables assignments not falling under a registry system\u2014do not require a liability cap as a matter of law.<\/p>\n<p>Accordingly, while Turkish law provides that a cap must be stated only in the limited circumstances above, it does not impose a general obligation to include a maximum secured amount in all security documents.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What are the formalities for taking and perfecting security in your jurisdiction and the associated costs and timing? If these requirements are different for different asset classes, please outline the main points to note for each of these briefly.<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Securities in acquisition finance are typically executed in the form of a private deed or agreement. However, the types of securities that are subject to specific formalities or special execution requirements are outlined below:<\/p>\n<ul>\n<li>Guarantee\/suretyship; The TCO stipulates that certain information regarding a suretyship (such as the amount, date, and type of suretyship) must be handwritten by the surety. Moreover, the TCO provides that the same formalities applicable to the establishment of a suretyship shall also apply to any other form of personal security granted by individuals, including guarantees. Accordingly, when obtaining a guarantee from a real person, the formalities applicable to suretyships must be observed, and specific information regarding the guarantee (e.g., the date and amount) must be handwritten by the guarantor.<\/li>\n<li>Share pledge: A share pledge is not subject to any written form requirement, yet it is usually established through a private deed or agreement. However, certain formalities must be observed in order to validly establish this security. Firstly, the share certificates representing the shares (if any exist) must be endorsed and delivered to the pledgee. Secondly, the share pledge must be recorded in the company\u2019s share ledger. To perfect these formalities, each of the above actions should be supported by board of directors\u2019 resolution of the company adopted to approve both the relevant actions and the establishment of the share pledge itself.<\/li>\n<li>Moveable Pledge: There are different methods to establish a moveable pledge under Turkish regulatory framework. However, in commercial transactions, the most commonly preferred method is to establish a movable pledge under Movable Pledge Law, as it offers significant operational and legal advantages for both parties. As per Moveable Pledge Law, a movable pledge agreement must be executed before a notary public as a notarial deed and must be registered within the movable pledge registry, an electronic registry maintained by the Union of Turkish Notaries, where all records of established movable pledges are stored. Moreover, if any movable asset subject to the pledge is registered with another registry, the relevant notary public must notify the corresponding registry of the established pledge.<\/li>\n<li>Immoveable Pledge (Mortgage): An immovable pledge is subject to statutory form requirements. An immovable pledge agreement must be executed before the competent land registry as a formal deed of pledge and must be registered in the land registry records of the relevant immovable property.<\/li>\n<li>Transfer of Receivables: The transfer of receivables is subject to a written form requirement. Accordingly, receivables must be transferred by means of a private agreement or deed. However, transfers of certain receivables originating from public entities may be subject to specific formalities imposed by the debtor public entity. For instance, receivables arising within Energy Exchange Istanbul (EXIST) must be transferred through a notarial deed in order to be registered in EXIST\u2019s records. Pursuant to the TCO, the transfer must also be notified to the debtor in order to be effective against that debtor. In practice, transfer of receivables agreements are generally executed as notarial deeds, and notifications are sent to the debtor via notary public as a prudent measure.<\/li>\n<\/ul>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are there any limitations, restrictions or prohibitions on downstream, upstream and cross-stream guarantees in your jurisdiction? Please also provide a brief description of any potential mitigants or solutions to these limitations, restrictions or prohibitions.<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Under Turkish law, downstream guarantees are not subject to any specific statutory restriction.<br \/>\nUpstream and cross-stream guarantees are allowed but subject to the corporate benefit requirement and creditor-protection rules under the TCC.<\/p>\n<p>TCC also provides that a parent company cannot compel its subsidiary to assume liabilities such as guarantees or suretyships. That said, a subsidiary may voluntarily grant an upstream guarantee so long as (i) its board acts with due care, and (ii) any resulting loss is properly compensated. Otherwise, the transaction may be deemed unlawful.<\/p>\n<p>Listed companies are subject to stricter rules under the capital market regulations. Public companies may provide guarantees only (i) for their own obligations, (ii) for fully consolidated subsidiaries, or (iii) for third parties in the ordinary course of business. Guarantees outside these categories are prohibited.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are there any other notable costs, consents or restrictions associated with providing security for, or guaranteeing, acquisition financing in your jurisdiction?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>In T\u00fcrkiye, the provision of security or guarantees in connection with acquisition financing is subject to certain costs, consents, and statutory restrictions.<\/p>\n<p>First, the creation and perfection of security interests entail notarial, registry, and filing fees. For real estate mortgages, registration fees are payable under the Fees Law No. 492 and the Land Registry Law No. 2644 together with related secondary regulations. For pledges over movable assets established under the Movable Pledge Law, registration and announcement fees are payable through the movable pledge registry system. If the security or guarantee documentation is executed before a notary, notarial fees will also apply.<\/p>\n<p>Additionally, under the provisions of the TCO, certain personal guarantees \u2014 including suretyships \u2014 require the prior written consent of the guarantor\u2019s spouse in order to be valid, unless one of the statutory exemptions applies (such as judicial separation or a matrimonial regime that does not require spousal consent). However, there are certain exceptions to this requirement: spousal consent is not required where the surety is a shareholder or a board member of the legal entity for which the suretyship is provided. Such spousal consent, when required, must be given before or at the time of the execution of the suretyship agreement.<\/p>\n<p>Furthermore, in the case of assignment of receivables, if the underlying contract includes a contractual prohibition on assignment, the creditor\u2019s assignment will require the prior consent of the debtor; otherwise, the assignment may not be enforceable against the debtor. This debtor consent requirement becomes particularly relevant where receivables are pledged or assigned by way of security as part of an acquisition financing structure.<\/p>\n<p>In summary, the key factors to consider when providing security or guarantees for acquisition financing in T\u00fcrkiye include: (i) notarial and registration costs, (ii) formal validity requirements for guarantees and suretyships under the TCO and (iii) obtaining debtor consent where assignment prohibitions apply.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Is it possible for a company to give financial assistance (by entering into a guarantee, providing security in respect of acquisition debt or providing any other form of financial assistance) to another company within the group for the purpose of acquiring shares in (i) itself, (ii) a sister company and\/or (iii) a parent company? If there are restrictions on  granting financial assistance, please specify the extent to which such restrictions will affect the amount that can be guaranteed and\/or secured.<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>The main restriction under Turkish law is the financial assistance prohibition in Article 380 of the TCC. This provision prohibits a company from providing any form of financial assistance\u2014whether by way of an advance, loan or security\u2014for the purpose of enabling a third party to acquire its own shares. The rule is mandatory and any transaction in breach of Article 380 is null and void.<\/p>\n<p>This prohibition also captures financial assistance given for the acquisition of shares in the parent company, as this would indirectly finance the acquisition of the company\u2019s own shares and is treated as falling within the scope of Article 380.<\/p>\n<p>By contrast, financial assistance provided in connection with the acquisition of shares in a sister company does not fall within the scope of this statutory prohibition.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">If there are any financial assistance issues in your jurisdiction, is there a procedure available that will have the effect of making the proposed financial assistance possible (and if so, please briefly describe the procedure and how long it will take)?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Under Turkish law, any transaction that amounts to financial assistance\u2014such as providing an advance, loan or security to facilitate the acquisition of a company\u2019s own shares\u2014is strictly prohibited under Article 380 of the TCC. This prohibition is mandatory and absolute; it cannot be cured or validated through any shareholders\u2019 or board resolution. In practice, however, the prohibition may be navigated through a post-acquisition restructuring.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">If there are financial assistance issues in your jurisdiction, is it possible to give guarantees and\/or security for debt that is not pure acquisition debt (e.g. refinancing debt) and if so it is necessary or strongly desirable that the different types of debt be clearly identifiable and\/or segregated (e.g. by tranching)?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Other than the generally applicable transfer pricing and disguised capital transfer prohibitions, the financial assistance prohibition under the Turkish regulatory framework arises from Article 380 of the TCC, as explained in detail above. Therefore, this prohibition is applicable only to acquisition-related debts, and it remains possible to provide guarantees and\/or other forms of security for the indebtedness of a third party, provided that such indebtedness falls outside the scope of Article 380 of the TCC.<\/p>\n<p>Therefore, segregating different loan lines is a highly effective method to distinguish between acquisition-related and non-acquisition-related financing. Although it may be argued that the non-acquisition-related portion of a security granted under a non-segregated loan is not automatically void, structuring the loan and security package in line with such segregation remains a safer and more efficient approach.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Does your jurisdiction recognise the concept of a security trustee or security agent for the purposes of holding security, enforcing the rights of the lenders and applying the proceeds of enforcement? If not, is there any other way in which the lenders can claim and share security without each lender individually enforcing its rights (e.g. the concept of parallel debt)?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>The Turkish regulatory framework does not explicitly regulates the concept of a security trustee or security agent. Nevertheless, it is a common market practice to establish a security agent structure through contractual mechanisms.<\/p>\n<p>Firstly, as Article 169 of the TCO recognises the concept of joint and several creditors, parties often create joint and several creditor relationships among the lenders, ensuring that each creditor is entitled to the entire loan receivable. This arrangement allows one of the lending institutions to act as the security agent, holding the security for and on behalf of all lenders and exercising their rights in this respect.<\/p>\n<p>Another contractual method for establishing a security agent mechanism is the parallel debt structure, which serves a similar purpose with the concept of joint and several creditors. However, the parallel debt concept is not expressly recognised under Turkish law and remains largely untested by Turkish courts. Accordingly, parties generally rely on the principle of freedom of contract to implement a parallel debt arrangement within the loan documentation.<\/p>\n<p>As the concept of a security agent is not formally recognised under Turkish law, no statutory provisions govern the rights and obligations of a security agent. Therefore, it is essential to clearly set out the rights, duties, and authorities of the security agent in the loan documentation (either within the main credit agreement or under a separate security agency agreement), in conjunction with the establishment of a joint and several creditor and\/or parallel debt mechanism.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Does your jurisdiction have significant restrictions on the role of a security agent (e.g. if the security agent in respect of local security or assets is a foreign entity)?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>As explained in Question No. 20, since the concept of a security agent is not explicitly regulated under the Turkish regulatory framework, it is essential to establish a mechanism whereby each lender becomes a creditor for the entirety of the loan debt in order to appoint a security agent. As a natural consequence of this structure, the security agent must be one of the lenders. Accordingly, the appointment of an external security agent or the establishment of a security trust mechanism is not feasible under Turkish regulatory framework.<\/p>\n<p>Other than this limitation, there are no specific restrictions regarding the appointment of the security agent. Any entity that is eligible to be a party to a security agreement may act as a security agent \u2014 including foreign entities. However, appointing foreign entities may create additional tax burdens, as certain tax exemptions applicable to security agreements are only available to Turkish lenders.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Please provide the main differences and considerations between bank loan financing and high yield bond\/note financing for acquisition purposes in your jurisdiction, and how do they affect the structuring and documentation of the transaction?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>In T\u00fcrkiye, high-yield bond financing for acquisition purposes remains uncommon, as most acquisition financings continue to rely on bank loans provided by domestic or international lenders. This preference is largely driven by the established banking infrastructure, regulatory familiarity, and the relatively limited depth of T\u00fcrkiye\u2019s corporate bond market.<\/p>\n<p>Nevertheless, project bonds have occasionally been used to finance large-scale infrastructure and energy projects in T\u00fcrkiye, demonstrating that a similar structure could be adapted for acquisition finance transactions as the market evolves.<\/p>\n<p>From a structural and documentation perspective, bank loans and high-yield bonds differ significantly. Bank financings typically feature tighter and more comprehensive covenants, often including ongoing financial maintenance tests, regular reporting obligations, and security over assets. Interest rates are usually floating, with borrowers often using interest rate swaps to hedge exposure. Execution is relatively faster and less costly and drawdowns can be made in tranches. By contrast, high-yield bonds tend to include incurrence-based covenants, with fixed interest rates, minimal hedging needs, and bullet repayments at maturity. Bond offerings entail higher transaction costs, longer preparation periods, and detailed disclosure and due-diligence requirements under capital markets regulations. They are often unsecured though secured high-yield issuances are increasingly common in international markets. These distinctions materially affect both the structuring and documentation of acquisition financings in T\u00fcrkiye, influencing everything from covenant packages and pricing mechanics to execution timelines and investor disclosure.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Describe the loan transfer mechanisms that exist in your jurisdiction and how the benefit of the associated security package can be transferred.<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Under Turkish law, loans are typically transferred either by assignment of receivables or assignment of contract, both regulated under the TCO. Novation is available but rarely used, as it extinguishes the original debt and therefore the attached security.<\/p>\n<p>The assignment of receivables is the standard tool for transferring drawn loan amounts. It must be made in writing, and although borrower consent is not required, the borrower must be notified to prevent discharge by payment to the original lender. The assignment of contract is used where the entire contractual position is transferred. This mechanism requires the borrower\u2019s consent.<\/p>\n<p>Security package transfers together with the loan under the principle of accessoriness set out in TCO. Accordingly, accessory securities automatically transfer to the new lender by operation of law. By contrast, independent guarantees, which are non-accessory in nature, do not transfer automatically and must be expressly assigned.<\/p>\n<p>Although accessory security transfers automatically, perfection updates are required for opposability against third parties. This usually involves updating the relevant registries, such as recording the new mortgagee at the land registry or the new pledgee at the movable pledge registry.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What are the rules governing the priority of competing security interests in your jurisdiction? What methods of subordination are used in your jurisdiction and can the priority be contractually varied? Will contractual subordination provisions survive the insolvency of a borrower incorporated in your jurisdiction?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Under Turkish law, the priority of competing security interests is determined primarily by the TCC and, for commercial movable assets, by the Movable Pledge Law. The general principle is \u2018first in time, stronger in right\u2019, meaning that priority depends on the order and timing of registration in the relevant public registry. A duly perfected (registered) security interest will prevail over later-registered or unregistered ones.<\/p>\n<p>For immovable property, mortgages are generally ranked according to their registration order in the land registry under the relevant provisions of the TCC. However, the Turkish ranking system allows creditors to leave a degree empty or skip a degree. Accordingly, even if a mortgage is registered later in time, it may take priority if it is placed in an earlier vacant degree. Any agreed changes to existing rankings must also be made with the mutual consent of the affected creditors and must be duly registered to be effective.<\/p>\n<p>For movable assets, including commercial pledges, priority is determined under the Movable Pledge Law. The priority of multiple pledges is based on the registration date and sequence number in the movable pledge registry system.<\/p>\n<p>Subordination between creditors can be achieved in two principal ways under Turkish law. The first is through contractual subordination or intercreditor agreements, under which creditors agree among themselves on the order and manner of payments (for example, by including waterfall or turnover provisions). These agreements are valid and enforceable among the contracting parties pursuant to the TCO, which recognise freedom of contract. However, such agreements have only inter partes effect \u2014 they bind only the parties and do not alter the statutory ranking of claims vis-\u00e0-vis third parties or in insolvency.<\/p>\n<p>The second form of subordination or ranking change is registrable subordination, applicable to certain registered securities such as mortgages or commercial pledges. Secured creditors may mutually agree to change their ranking, provided that such agreement is registered in the relevant registry (land registry or movable pledge registry). Once registered, the ranking change becomes effective erga omnes (against all third parties).<\/p>\n<p>In the event of insolvency or bankruptcy, contractual subordination provisions do not affect the statutory ranking of creditors set out in the Execution and Bankruptcy Law No. 2004.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Is there a concept of \u201cequitable subordination\u201d in your jurisdiction whereby loans provided by a shareholder (as a creditor) to a company incorporated in your jurisdiction are subordinated by law upon insolvency of that company in your jurisdiction?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Under Turkish law, there is no doctrine equivalent to \u2018equitable subordination\u2019 as recognised in common law jurisdictions, where a bankruptcy court may lower the priority of a creditor\u2019s claim due to inequitable or wrongful conduct. Turkish courts do not have the discretionary power to alter the statutory ranking of claims in insolvency proceedings based on a creditor\u2019s position.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Does your jurisdiction generally (i) recognise and enforce clauses regarding choice of a foreign law as the governing law of the contract, the submission to a foreign jurisdiction and a waiver of immunity and (ii) enforce foreign judgments?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Under Turkish law, the choice of a foreign governing law, the submission to a foreign jurisdiction, and waiver of sovereign immunity are generally recognised and enforceable, provided that certain statutory conditions are satisfied.<\/p>\n<p><strong>The Choice of a Foreign Governing Law<\/strong><\/p>\n<p>Pursuant to provisions of the Turkish Code on Private International and Procedural Law No. 5718, parties to a contract containing a foreign element are free to choose the governing law, provided such choice does not violate Turkish public policy. However, certain matters \u2014 such as real rights over immovable property located in T\u00fcrkiye, employment contracts, consumer contracts, and mandatory rules of Turkish law \u2014 cannot be derogated from by agreement.<\/p>\n<p><strong>The Submission to a Foreign Jurisdiction<\/strong><\/p>\n<p>Submission to a foreign court\u2019s jurisdiction is also valid, again subject to the requirement that the dispute involves a foreign element and that Turkish courts do not have exclusive jurisdiction over the subject matter (for example, disputes concerning rights in rem over immovables located in T\u00fcrkiye, or certain corporate law matters).<\/p>\n<p><strong>Waiver of Sovereign Immunity<\/strong><\/p>\n<p>A waiver of sovereign or jurisdictional immunity by a foreign state or state-owned entity is recognised under Turkish practice, provided it is made explicitly and unequivocally. Turkish courts tend to distinguish between sovereign acts (jure imperii), for which immunity is maintained, and commercial acts (jure gestionis), for which immunity may be waived.<\/p>\n<p>Recognition and Enforcement of Foreign Judgments<br \/>\nA foreign judgment is enforceable in T\u00fcrkiye if:<\/p>\n<p>1) The judgment does not concern matters within the exclusive jurisdiction of Turkish courts; and<\/p>\n<p>2) The judgment does not violate Turkish public policy.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What are the requirements, procedures, methods and restrictions relating to the enforcement of collateral by secured lenders in your jurisdiction?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>In T\u00fcrkiye, the enforcement of collateral depends on its type but is generally carried out through the enforcement office, as self-help remedies are limited and the lex commissoria prevents a creditor from automatically taking ownership of the collateral upon default.<\/p>\n<p>Mortgages over immovable property are enforced through foreclosure proceedings before the enforcement office, which sells the property by public auction and pays the secured creditor from the proceeds with priority.<\/p>\n<p>For movable asset pledges, the commercial movable pledge regime allows certain out-of-court realisation methods\u2014such as taking possession, leasing, or selling the asset\u2014only if the pledge agreement expressly provides for them. Otherwise, enforcement must proceed through the enforcement office.<\/p>\n<p>In receivable assignments or account pledges, the creditor may directly collect from the third-party debtor or set off the account balance, to the extent permitted by the agreement.<br \/>\nAfter insolvency proceedings begin, secured creditors retain priority over the collateral proceeds, but enforcement continues under the supervision of the insolvency administration.<\/p>\n<p>Overall, while limited out-of-court options exist for movable pledges, most collateral types require formal enforcement procedures due to restrictions on automatic appropriation.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What are the insolvency or other rescue\/reorganisation procedures in your jurisdiction?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>In T\u00fcrkiye, companies in financial distress mainly rely on bankruptcy, concordat, financial restructuring, and capital-loss\/over-indebtedness measures under company law.<\/p>\n<p>Concordat is a court-supervised restructuring mechanism that enables a financially troubled but operationally viable company to avoid bankruptcy by proposing a payment plan to its creditors. Once the court grants temporary and then definite protection, enforcement actions are suspended and the company continues operations under the supervision of a commissioner. If the restructuring plan is approved by the required creditor majority and confirmed by the court, it becomes binding on unsecured creditors.<\/p>\n<p>Financial restructuring is a mechanism that enables companies facing financial difficulties to work directly with banks and other financial institutions to adjust their debt obligations without the need for court proceedings. Within this framework, elements such as loan maturities, repayment schedules, interest terms, or collateral arrangements may be renegotiated. The aim is to ease the company\u2019s financial burden and restore sustainability through a purely contractual process.<\/p>\n<p>Under TCC, if a company experiences significant capital erosion or becomes over-indebted, the board of directors must assess the company\u2019s financial status and propose appropriate remedial actions. These may include capital injection, capital decrease, operational or financial restructuring, or taking measures to avoid insolvency. If the company\u2019s liabilities exceed its assets and no adequate remedy is implemented, the board may be required to apply for bankruptcy.<\/p>\n<p>Overall, the Turkish system provides both judicial (concordat) and contractual (financial restructuring) tools, complemented by corporate-governance-based remedial duties for companies facing capital loss or over-indebtedness.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Does entry into any insolvency or other process in your jurisdiction prevent or delay secured lenders from accelerating their loans or enforcing their security in your jurisdiction?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Under Turkish law, the commencement of insolvency or restructuring proceedings may restrict or delay the ability of secured lenders to accelerate their loans or enforce their security, depending on the type of proceeding involved.<\/p>\n<p>When bankruptcy proceedings are initiated, individual enforcement actions by creditors \u2014 including secured lenders \u2014 are automatically stayed. Once the bankruptcy decision becomes final, all creditors (including secured ones) must submit their claims to the bankruptcy estate. Secured creditors retain their right to satisfaction from the proceeds of their collateral, but they cannot independently enforce or sell the collateral outside the bankruptcy process.<\/p>\n<p>During a concordat process, the situation is somewhat different. Upon the court\u2019s decision to grant a temporary and later a definite moratorium, all enforcement actions \u2014 including those by secured creditors \u2014 are suspended.<\/p>\n<p>However, secured creditors may, with the court\u2019s approval, sell perishable or rapidly depreciating collateral or request partial enforcement if their rights would otherwise be seriously prejudiced. In general, secured creditors\u2019 rights are protected, but enforcement is deferred until the moratorium ends or the concordat plan is approved.<\/p>\n<p>Under the restructuring through reconciliation regime, the debtor remains in control of its business. This process does not automatically trigger a stay of enforcement unless the restructuring plan specifically provides for one and is approved by the court.<\/p>\n<p>In all cases, acceleration clauses in loan agreements are valid and enforceable under Turkish law. However, once insolvency or concordat proceedings commence, actual enforcement of such acceleration is subject to statutory stays and judicial supervision.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">In what order are creditors paid on an insolvency in your jurisdiction and are there any creditors that will take priority to secured creditors?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>In Turkish insolvency proceedings, creditors are paid according to a statutory ranking that prioritises secured claims over most other debts. Secured creditors are paid first from the proceeds of the collateral subject to their security interest, and their priority is limited to the value of that collateral. Any remaining portion of their claim that is not covered by the collateral ranks as an unsecured debt.<\/p>\n<p>After secured creditors are satisfied from their collateral, the estate\u2019s general assets are distributed according to a separate priority order. Claims relating to employee receivables, certain tax and social security obligations, and other mandatory public claims typically rank ahead of ordinary unsecured creditors. Ordinary unsecured creditors are paid only after these higher-ranking claims are satisfied and share the remaining estate proportionally if the estate is insufficient.<\/p>\n<p>Subordinated or contractual junior claims are paid last, if at all.<\/p>\n<p>Overall, while secured creditors enjoy priority with respect to the collateral itself, certain protected categories\u2014such as employee claims and specific public debts\u2014may rank above ordinary unsecured creditors when distributions are made from the general estate.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are there any hardening periods or transactions voidable upon insolvency in your jurisdiction?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Turkish law allows certain transactions made shortly before bankruptcy to be unwound if they harm creditors. The aim is to prevent a debtor from shifting assets, favoring specific creditors, or otherwise reducing the estate as insolvency approaches. Gratuitous transfers, unjustified preferences, or dealings carried out with the intention of prejudicing creditors may be reversed within defined look-back periods. Transactions with related parties are examined more strictly. If a transaction is set aside, the asset (or its value) returns to the bankruptcy estate, and the counterparty becomes an unsecured creditor.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are there any other notable risks or concerns for secured lenders in enforcing their rights under a loan or collateral agreement (whether in an insolvency or restructuring context or otherwise)?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Secured lenders in T\u00fcrkiye may face significant procedural and practical delays when enforcing collateral, as Turkish enforcement proceedings are highly formalistic and susceptible to debtor objections. Strict notification rules, valuation processes and auction mechanics often prolong enforcement timelines. In addition, valuation risks and depressed auction prices are common concerns, since collateral must typically be sold through public auctions where expert valuations tend to be conservative and market appetite may be limited, reducing overall recovery levels.<\/p>\n<p>Moreover, in restructuring scenarios such as concordat or financial restructuring under the Banking Law, secured creditors\u2019 enforcement rights may be temporarily stayed or subject to statutory limitations, which can materially restrict their ability to act quickly on collateral. Finally, when finance documents are governed by foreign law, lenders should be aware that enforcement of Turkish-located collateral is subject to mandatory Turkish rules; notably, self-help remedies and direct appropriation of collateral are not recognised, requiring lenders to rely on judicial or enforcement office processes.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Please detail any taxes, duties, charges or related considerations which are relevant for lenders making loans to (or taking security and guarantees from) entities in your jurisdiction in the context of acquisition finance, including if any withholding tax is applicable on payments (interest and fees) to lenders and at what rate.<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Under Turkish law, several taxes and charges may arise in connection with lending, security and guarantees in acquisition finance transactions. The key considerations are outlined below.<\/p>\n<p><strong>Stamp Tax<\/strong><\/p>\n<p>Loan agreements and related security documents are generally subject to stamp tax at 0.948% of the maximum monetary amount stated in the document.<\/p>\n<p>However, a full exemption applies where the loan is extended by (i) Turkish banks, (ii) foreign credit institutions, or (iii) international financial institutions. This exemption covers all documents related to the loan, including mortgages and pledges.<\/p>\n<p>Although exempt from proportional stamp tax, security perfection (e.g., mortgage registration or movable pledge registration) remains subject to nominal, fixed registry fees.<\/p>\n<p><strong>Banking and Insurance Transaction Tax (BITT)<\/strong><\/p>\n<p>BITT is an indirect tax imposed on banking and insurance transactions in T\u00fcrkiye and applies to interest and fee income earned by Turkish banks.<\/p>\n<p>Rates vary between 0.1% and 15%, depending on the transaction type. Although the legal taxpayer is the bank, BITT is typically reflected in loan pricing and passed on to borrowers.<\/p>\n<p><strong>Resource Utilisation Support Fund (RUSF)<\/strong><\/p>\n<p>RUSF applicability depends on the lender type and the loan\u2019s currency and maturity. RUSF is calculated on the accrued interest amount for Turkish Lira-denominated loans, and on the principal amount disbursed as of the utilisation date for foreign-currency-denominated loans.<\/p>\n<p>1. Loans extended by Turkish banks and financing companies<\/p>\n<ul>\n<li>Consumer loans: 15%<\/li>\n<li>Commercial TRY loans: 0%<\/li>\n<li>Commercial FX or gold loans: 1%<\/li>\n<\/ul>\n<p>2. Loans obtained from abroad by Turkish banks and financing companies<\/p>\n<ul>\n<li>All loans (TL \/ FX \/ gold): 0%<\/li>\n<\/ul>\n<p>3. Loans obtained from abroad by Turkish residents other than banks\/financing companies<\/p>\n<p>FX or gold-denominated loans:<\/p>\n<ul>\n<li>Up to 1 year maturity: 3%<\/li>\n<li>1\u20132 years: 1%<\/li>\n<li>2\u20133 years: 0.5%<\/li>\n<li>3+ years: 0%<\/li>\n<\/ul>\n<p>TL loans:<\/p>\n<ul>\n<li>Up to 1 year maturity: 1%<\/li>\n<li>1+ years: 0%<\/li>\n<\/ul>\n<p><strong>Withholding Tax (WHT)<\/strong><\/p>\n<p>Under Turkish law, interest payments to Turkish banks are not subject to withholding tax; instead, Turkish banks declare and pay corporate income tax on such interest income.<br \/>\nInterest paid to foreign lenders may be subject to WHT at rates that vary depending on the nature of the loan, the type of lender, and any applicable double tax treaty provisions.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are there any other tax issues that foreign lenders should be aware of when lending into your jurisdiction?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>In addition to the tax considerations outlined in the previous question, it should be noted that the stamp tax exemption applicable to loan and security documentation does not extend to loans provided by foreign non-resident financial institutions. Accordingly, unless a specific exemption applies, documentation relating to cross-border loans granted by such institutions may trigger stamp tax exposure<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What is the regulatory framework by which an acquisition of a public company in your jurisdiction is effected?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Alongside the general provisions of the Turkish regulatory framework applicable to any type of corporate acquisition, the acquisition of publicly traded companies is subject to Law No. 6362 on Capital Markets (Capital Markets Law). In addition, such acquisitions are subject to various communiqu\u00e9s and principal decisions issued by the Capital Markets Board of T\u00fcrkiye (CMB), which acts as the regulatory authority for capital markets.<\/p>\n<p>Key communiqu\u00e9s include:<\/p>\n<ul>\n<li>Communiqu\u00e9 on Shares (VII 128.1): Governs the main principles for issuing and acquiring capital market instruments.<\/li>\n<li>Communiqu\u00e9 on Takeover Bids (II 26.1): Regulates the mandatory takeover offer obligation of a purchaser that acquires controlling shares of a publicly traded company, including the conditions and exceptions applicable to such obligation.<\/li>\n<li>Communiqu\u00e9 on Material Events Disclosure (II 15.1): Governs disclosure obligations regarding events that may affect investors; the total or partial acquisition of a public company will, in most cases, constitute a material event under this communiqu\u00e9.<\/li>\n<li>Communiqu\u00e9 of Squeeze-out and Sell-out Rights (II-27.3): Regulates the squeeze out and sell out rights of shareholders when a party acquires nearly all shares of a public company.<\/li>\n<\/ul>\n<p>Finally, since shares of publicly traded companies are traded on Istanbul Stock Exchange (ISE), the acquisition is also subject to the ISE Listing Directive, which sets out the exchange\u2019s rules and principles for public trading.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What are the key milestones in the timetable (e.g. announcement, posting of documentation, meetings, court hearings, effective dates, provision of consideration, withdrawal conditions)?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>In T\u00fcrkiye, acquisitions of listed companies that result in a change of control are mainly governed by the Capital Markets Law and the Communiqu\u00e9 on Takeover Bids.<\/p>\n<p>The triggering event (such as the signing or closing of the share transfer that results in control, or the execution of a control agreement) must be immediately disclosed to the market as a material event disclosure on the Public Disclosure Platform (PDP).<\/p>\n<p>Within six business days following the public disclosure of the change of control, the bidder must apply to the CMB to launch the mandatory bid. The application must include the draft Takeover Bid Information Form and other prescribed documents. The offer cannot commence until the CMB has approved the Information Form. Once approved, the final version must be published on PDP, and the bidder must initiate the offer within six business days.<\/p>\n<p>The offer period must last between 10 and 20 business days. Following the end of the offer period, the bidder must publish a final PDP announcement summarising the outcome of the bid.<\/p>\n<p>The actual bid process must be initiated and completed within two months from the date on which the mandatory bid obligation arose.<\/p>\n<p>There is no court approval or court hearing step in the Turkish takeover timetable.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What is the technical minimum acceptance condition required by the regulatory framework? Is there a squeeze out procedure for minority hold outs?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Under Turkish law, there is no fixed statutory minimum acceptance condition applicable to takeovers of public companies. The Capital Markets Law and the relevant secondary legislation issued by the CMB regulate the general framework for mandatory and voluntary takeover offers, as well as squeeze-out and sell-out mechanisms.<\/p>\n<p>When an investor (or a group acting in concert) directly or indirectly acquires management control of a public company, that investor is required to launch a takeover offer to purchase the remaining shares from minority shareholders. There is no separate acceptance threshold for such offers; the requirement is simply to make the offer available to all remaining shareholders, each of whom is free to accept or decline.<\/p>\n<p>There is no separate acceptance threshold for such offers; the requirement is simply to make the offer available to all remaining shareholders, each of whom is free to accept or decline.<\/p>\n<p>For voluntary takeover offers, Turkish law does not prescribe any minimum acceptance threshold. Instead, the offeror may set such conditions at its own discretion as part of the contractual terms of the voluntary offer, provided that these conditions are clearly disclosed in the offer document submitted to\u2014and approved by\u2014the CMB. These conditions typically reflect commercial considerations rather than regulatory requirements.<\/p>\n<p>With respect to squeeze-out and sell-out rights, the applicable regulations provide that a squeeze-out right arises when a shareholder (or group) acquires 98% or more of the voting rights in a public company. At this level, the majority shareholder may require the remaining minority shareholders to sell their shares at a fair value determined through an independent valuation process. Conversely, once the same threshold is reached, minority shareholders also acquire a sell-out right, allowing them to require the controlling shareholder to purchase their shares on equivalent terms.<\/p>\n<p>In summary, Turkish law does not impose a regulatory minimum acceptance condition for takeovers. Mandatory takeover offers are triggered by the acquisition of control, whereas squeeze-out and sell-out mechanisms become available once a 98% ownership level is reached.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">At what level of acceptance can the bidder (i) pass special resolutions, (ii) de-list the target, (iii) effect any squeeze out, and (iv) cause target to grant upstream guarantees and security in respect of the acquisition financing?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Under Turkish law, a bidder\u2019s ability to take post-acquisition actions in a listed company depends on statutory thresholds set out in the TCC and the capital market regulations.<\/p>\n<p>(i) Passing special resolutions<\/p>\n<p>A general assembly meeting convenes with at least 25% of the share capital. Once the meeting is validly held, resolutions are adopted by a simple majority of the votes cast. Accordingly, a bidder holding 50.01% of the voting rights is generally sufficient to pass most resolutions.<\/p>\n<p>However, certain matters require higher thresholds:<\/p>\n<p>(a) Unanimous approval of all shareholders is required for imposing additional payment obligations on shareholders or relocating the company\u2019s registered seat abroad.<\/p>\n<p>(b) Approval of at least 75% of the share capital is required for amendments involving a complete change of business purpose, creation of privileged shares, or restrictions on the transfer of registered shares.<\/p>\n<p>(ii) De-listing the target<\/p>\n<p>Under the capital market regulations, a bidder holding at least 95% of the share capital following a takeover bid may apply to the CMB for delisting.<\/p>\n<p>(iii) Squeeze-out rights<\/p>\n<p>Under the capital market regulations, once the bidder (together with persons acting in concert) reaches 98% of the share capital, squeeze-out and sell-out rights are triggered. At this level, the majority shareholder may compel minority shareholders to sell their shares, and minority shareholders may in parallel exercise their sell-out right.<\/p>\n<p>(iv) Causing the target to grant upstream guarantees or security for acquisition financing<\/p>\n<p>Corporate control\u2014i.e., the ability to appoint or remove the board of directors\u2014is achieved at 50.01% of the voting rights. However, this does not override the financial assistance prohibition under the TCC. This restriction applies regardless of ownership percentage. Upstream or cross-stream guarantees not related to the acquisition of the guarantor\u2019s own shares may be permissible, but remain subject to corporate benefit requirements and, for listed companies, capital markets rules.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Is there a requirement for a cash confirmation and how is this provided, by who, and when?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Alongside the financial assistance prohibitions on leveraged acquisition financings that are described in above questions, the main restrictions on certain types of financing under the Turkish regulatory framework arise from Decree No. 32 and the Capital Movements Communique (CMC) issued by the Central Bank of the Republic of T\u00fcrkiye. These regulations limit the use of financing in foreign currency or financing denominated to a foreign currency.<\/p>\n<p>According to Decree No. 32 and the CMC:<\/p>\n<p>(i) Individuals (real persons) cannot use credit in a foreign currency or denominated to a foreign currency whether from a domestic or foreign creditor.<\/p>\n<p>(ii) Legal entities cannot use credit in a foreign currency from a domestic or foreign creditor unless they have sufficient foreign currency income or are exempt from this requirement (e.g., public institutions or companies using investment credits supported by an Investment Incentive Certificate issued by the Ministry of Industry and Technology).<\/p>\n<p>(iii) Legal entities cannot use foreign currency denominated credits, whether from a domestic or foreign creditor.<\/p>\n<p>Credit institutions are obliged to ensure compliance with the above rules, including verifying the existence of sufficient foreign currency income, when granting foreign currency credit.<\/p>\n<p>Moreover, there is no specific cash confirmation requirement applicable to all types of acquisitions under the Turkish regulatory framework. However, in the acquisition of shares of a public company through mandatory and\/or voluntary takeover bids launched in accordance with the CMB regulations, CMB has the authority to request a bank guarantee and\/or a guarantee from a third party to secure the fulfilment of financial obligations relating to the takeover bid.<\/p>\n<p>The CMB may make such a request after the takeover bid application is submitted, and the required guarantee must be provided before the takeover bid is launched.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What conditions to completion are permitted?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Under Turkish law, completion conditions in public company acquisitions are primarily governed by the Capital Markets Law and the Communiqu\u00e9 on Takeover Bids issued by the CMB.<\/p>\n<p>In mandatory takeover bids, conditions to completion are not permitted. Once the obligation to make a mandatory takeover offer arises (typically upon acquiring management control of a listed company), the offer must be made to all remaining shareholders and cannot be made conditional upon any further event or approval. The bidder must have financing in place and the offer must be unconditional, except for regulatory approvals that are required prior to launching the offer (e.g., competition clearance, sectoral authority approvals).<\/p>\n<p>By contrast, in voluntary takeover offers, the offeror is generally free to include contractual conditions to completion.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\r\n<div class=\"word-count-hidden\" style=\"display:none;\">Estimated word count: <span class=\"word-count\">10400<\/span><\/div>\r\n\r\n\t\t\t<\/ol>\r\n\r\n<script type=\"text\/javascript\" src=\"\/wp-content\/themes\/twentyseventeen\/src\/jquery\/components\/filter-guides.js\" async><\/script><\/div>"}},"_links":{"self":[{"href":"https:\/\/my.legal500.com\/guides\/wp-json\/wp\/v2\/comparative_guide\/124318","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/my.legal500.com\/guides\/wp-json\/wp\/v2\/comparative_guide"}],"about":[{"href":"https:\/\/my.legal500.com\/guides\/wp-json\/wp\/v2\/types\/comparative_guide"}],"wp:attachment":[{"href":"https:\/\/my.legal500.com\/guides\/wp-json\/wp\/v2\/media?parent=124318"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}