This is the November 2007 Edition of our email news service – Turkish Update – which is issued every two months. Our aim is to provide a concise and easy to read summary of developments in Turkey which may be of interest to our clients. This edition covers developments in September and October 2007.
General
Regulation for satellite broadcasting recently issued by the Radio and Television High Board. This new regulation, among other things, specifies requirements of satellite broadcasting companies for them to get satellite broadcasting licences and permits. It also specifies requirements for satellite and satellite platform operators.
For satellite broadcasting companies, the information required to obtain the broadcasting licences and permits includes: application forms, an invoice of the advance payment and relevant Turkish Trade Registry Gazettes showing the constitution and shareholding of the applicant company.
Please do not hesitate to contact us if you require a fuller summary of this regulation.
Real Estate
The Law No. 5711 amending the Law on Condominiums No.634 (the Law) was enacted by the parliament on 14 November 2007. The most significant effect of the Law in the Turkish real estate legislation is that common management for residential compounds spread out on multiple parcels will now be organised under a single management plan which has binding power on all individual and/or joint successors of the condominium owners. There was no clarity in the Law on Condominiums No.634 before as to the binding effect of management plans of compounds which are spread out on multiple parcels. However, the Turkish Court of Appeals was of the view that management plans for multiple parcels would not be binding on subsequent owners who have not signed the management plans. Management plans of residential compounds established before the execution of the Law are required to be amended to ensure compliance with the Law in six months at the latest.
Energy & Infrastructure
Law on the Establishment and Operation of Nuclear Power Facilities and Energy Sale enacted on 8 November 2007.States that the procedure for establishment and operation of nuclear power stations will be determined by the Ministry of Energy and Natural Resources.
The law also provides that TETAS (the state-owned electricity wholesale company) will open a tender one month after the secondary legislation enters into force. TAEK (Atom Energy Institution of Turkey) will set out the technical specifications in this tender, and EMRA (Energy Market Regulatory Authority of Turkey) will issue a licence to the companies that win the tender. TETAS will then sign a contract (which will not exceed a term of 15 years) with these companies to buy all the electricity they produce.
Regulation on "Fulfilling the Obligations Undertaken in Accordance with Electrical Energy Fund Agreements that Entered into Force Before 31 December 2001" published in the Official Gazette on 16 September 2007.The regulation sets out how obligations set out in Electrical Energy Fund Agreements should be performed. These Agreements (entered into force before 31 December 2001) should be based on Concession/Application Contracts (entered between the companies that established facilities in the electrical energy sector and the Ministry).
Regulation on "Nuclear Security Audits and Sanctions" published in the Official Gazette on 13 September 2007.Ensures that the activities on nuclear facilities are performed in a secure manner, and sets out nuclear security audits and sanctions. These nuclear security audits will discover the compliance of the said activities with the legislation that sets the conditions of the nuclear security targets and licences.
Regulation on "The Fundamental Requirements of Quality Management for the Security of Nuclear Facilities" published in the Official Gazette on 13 September 2007.
Tender [port]: Privatisation Administration's privatisation of Samsun and Bandirma Ports - new developments. Interested parties will be invited to submit their bids for both of these ports at the same time, although there may be a one- or two-week difference in the privatisation timetable. Both ports are expected to be privatised through operation right transfer and Soil Products Office (TMO) silos will also be included in the sale.
Automatic pricing in electricity will be postponed to the second half of 2008.An 11 per cent increase in electricity prices (viewed as necessary to compensate for the Turkish Electricity Distribution Corporation's (TEDAS) future losses) was to be made as of January 2008. However, during a meeting held at the Treasury with the participation of Energy State Economic Enterprises (SEEs), it was negotiated that the automatic pricing system (reflecting such increase) is to be implemented by the second half of 2008.
Ministerial meeting in Ankara on new pipeline project. On 23 October 2007, Israel's Minister for Energy and Infrastructure and Turkey's Minister for Energy and Natural Resources met in Ankara. The Turkish Minister declared that the preliminary feasibility studies had been completed for the "multiple pipeline project" between Turkey and Israel and that important steps had also been taken at the stage of calculating the project costs.
Tender [natural gas]: Baskent Do˘al Gaz. Baskent Do˘al Gaz, the owner of a 30-year licence to distribute gas in Ankara, is being privatised so as to reduce the Turkish state's role in energy, as urged by the International Monetary Fund. The sale could fetch as much as $3 billion, Ankara Mayor Melih Gökçek said last month. Natural gas consumption in Ankara is expected to more than double to 7.5 billion cubic metres a year in the next decade.
The TCA declared that it would not give consent to the acquisition of Merkez Group's rights and assets by Dogan Group in the markets of television broadcasting, marketing services for advertisement places, production services, newspaper and magazine publishing, printing and distribution. For Cukurova Group the TCA's concern is limited to the acquisition of Merkez Group's rights and assets related to its ATV channel, marketing services for advertisement places and production services related to the ATV channel.
Telecoms
Regulation on Market Surveillance and Audit of the Wireless and Telecommunication Terminal Equipment published in the Official Gazette on 19 October 2007. The aim of the regulation is to determine:
- the procedure, elements and the measures to be adopted concerning the offer to the market, distribution phase, existence in the market or submitting into service phase of the Wireless and Telecommunication Terminal Equipment;
- the duties, authorities and responsibilities of the Telecommunication Board on market surveillance and audit; and
- the obligations of the manufacturer, producer, authorised representative and distributors.
According to the regulation "Wireless Equipment" means the device (or its relevant items) that is directly or indirectly connected to the public telecommunication network. "Telecommunication Terminal Equipment" means the device (or its relevant items) that provides communication by the transmission and/or receiving of wireless waves transmitted in space.
Insurance
Regulation on the Provision of Information in Insurance Contracts published in the Official Gazette on 28 October 2007. Ensures that the consumer is aware of the content of the insurance policy they are entering into (both before signing and during the term of the insurance contract). This regulation comes into force on 1 March 2008.
Competition
Nurettin Kaldirimci appointed as the chairman of Competition Board on 2 November 2007. In addition, Ismail Hakkı Karakelle and Mustafa Ates were appointed as the members of Competition Board in October 2007.
Conditional approval by Competition Board of acquisition of Intergum Group published on 6 November 2007 by Cadbury Schweppes.
Banking/Asset-Trade Finance
Regulation on Principles and Procedures to be Applied for Re-financing of Loans under the Scope of House Financing published in Official Gazette No: 26658 on 29 September 2007. Introduces the legal refinance framework of consumer loan agreements for purchase, financial leasing and securitisation of houses. Sets out provisions on the changes in interest ratio, type of interest, term and currency of credit agreements, as well as the consolidation of various loans secured by the same house and changes of house financing institution. Requires housing finance institutions to inform consumers of the possible effects of amendments in the loan agreement and to get consumers' written approval.
The Banking Regulation and Supervision Agency has adopted several minor changes in banking legislation by "The Regulation amending the Regulation on Equity Capital of Banks", "The Regulation amending the Regulation on Authorisation and Activities of Valuation Companies Serving for Banks" and "Regulation amending the Regulation on Principles of Authorisation and Activities of Rating Companies". All published in the Official Gazette No. 26658 on 29 September 2007.
Guner Law Office was established in 1996 and has since grown into one of the major corporate, M&A, banking, litigation, energy and TMT practices in Turkey. Guner Law Office is headed by Ece Guner and works with international law firm Denton Wilde Sapte.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
