Corporate governance principles are set of rules and practices introduced as preventive measures pursuant to corruptions and bankruptcies of publicly held companies occurred in 1980s, for protection of companies, shareholders and stakeholders and to avoid conflicts of interest. Under Turkish approach, the managing body, i.e. board of directors, is regarded as the pillar of corporate governance given that the problems relate to the management of the companies. Therefore, the principles are focused on the board of directors.
Transfer of shares to a third party may cause harm to the existing shareholders and create undesired consequences for them. For example, share transfer may result in the entry of an undesired third party into the entity as a shareholder. Therefore, shareholders may require strict measures to be taken for protecting the corporate structure of the entity, preventing the entry of undesired third party to the entity, preventing deadlock when reaching a decision, preventing the sale of company’s shares to its competitors, protecting the rights of the minority shareholders, etc.
In line with the Law No. 7262 on Preventing the Proliferation of Financing Weapons of Mass Destruction (“Law No. 7262”), some of the provisions stipulated under the Turkish Commercial Code No. 6102 (“TCC”) were amended. As per the amendments made by the Law No. 7262, new notification requirement was introduced. In line with the amendments, the holders of the bearer share certificates in a joint stock company and the information regarding the shares have to be notified the Central Registry Agency (“CRA”).
The Regulation on Remote Identification Methods to be used by Banks and the Establishment of Contractual Relationships in Electronic Media (“Regulation”) was published in the Official Gazette dated April 1, 2021 and numbered 31441 and entered into force after one month as of its publication. The Regulation was prepared based on the Draft Communiqué on Remote Identification Methods to be used by Banks, which was published by the Banking Regulatory and Supervisory Authority ("BRSA") as presented to the public opinion.
On February 23, 2021, the Turkish Competition Authority (“Authority”) has published seminal judgments of the 13th Chamber of the Council of State (“Council of State”). These are landmark decisions that upheld the Turkish Competition Board’s (“Board”) analysis within the scope of its decision regarding the allegations that Mey İçki San. ve Tic. A.Ş. (“Diageo Turkey”) violated Article 6 of Law No. 4054 on the Protection of Competition (“Law No. 4054”) through exclusionary practices in the vodka and gin markets (“Vodka and Gin Decision”). The decisions of the Council of State are of particular significance since they affirmed a very rare usage of the “ne bis in idem” principle (i.e., a legal concept that restricts the possibility of a defendant being penalized repeatedly on the basis of the same offence, act or facts with the same time period) in terms of competition law.
We were introduced with right to be forgotten (“RTBF”) in 2014 with Court of Justice of the European Union’s (“CJEU”) Google Spain SL and Google Inc. v Agencia Española de Protección de Datos (AEPD) and Mario Costeja González decision (“González decision”). Since then, it has become an essential part of privacy rights and had seen many applications all around the world.
For our Checking In feature, we reach out to partners and heads of practice across CEE to learn how specific practice areas are faring in their jurisdictions. This time around we asked Data Protection experts: Overall, how compliant would you say economic agents are with relevant local regulations on data protection, and what are the main gaps that have yet to be addressed?
Allocation of liabilities between the parties in merger and acquisition (“M&A”) transactions is of utmost significance, in order to ensure that the buyer will be sufficiently protected, and the seller’s liabilities limited as much as possible. Under Turkish laws, the sellers` liabilities are subject to the provisions of the Turkish Code of Obligations No. 6908 (“TCO”). Having said this, Turkish laws are not designed to save commercial parties from a bad bargain, thus the parties often resort to adding certain clauses to their share purchase agreements (“SPA”) such as representations and warranties, indemnities, amount-based restrictions such as de minimis and baskets clauses, setting forth specific procedures and time limits for claims, and so on. Accordingly, this article aims to provide a general understanding as to the sellers’ liabilities in M&A transactions, the general liability provisions most commonly used in SPAs, and how they are dealt with under the Turkish laws.
The Turkish Competition Authority (“Authority”) has recently published its Draft Communiqué on Commitments Offered During Preliminary Investigations and Investigations on Restrictive Agreements, Concerted Practices, Decisions and Abuse of Dominance (“Draft Communiqué”) which has introduced a new commitment mechanism to Turkish competition law enforcement. This mechanism makes it possible for the undertakings and trade associations to offer commitments during an ongoing preliminary investigation or a full-fledged investigation process, in order to eliminate potential competition concerns under Articles 4 and 6 of the Law No. 4054 on the Protection of Competition (“Law No. 4054”) that prohibit restrictive agreements and abuse of dominance.
It is quite rare for the Turkish courts specialized in matters of intellectual property rights (“IP Courts”) and the Turkish Patent and Trademark Office (“TPTO”) to acknowledge the concept of bad faith in trademark registrations. In this sense, the recent Target Ventures decision of the General Court of the European Union (“EGC”) regarding bad faith in trademark registration applications is worth discussing, as this crucial decision sheds light on how bad faith should be assessed and may, therefore, also constitute a basis for Turkish IP practice in the future.
On November 18, 2020, the General Court of the European Union (“General Court”) upheld the European Commission’s (“Commission”) decision, in which Letuvos geležnkela AB (“Lithuanian Railway”) (“LG”) was found to have abused its dominant position in the Lithuanian rail freight market by removing a section of a railway track used by its competitors. In its appeal to the General Court, LG had requested that the Commission’s decision be annulled or in the alternative, the amount of the fine be reduced. While upholding the Commission’s decision, the General Court did reduce the amount of the fine imposed by almost a third, taking into account the duration and gravity of the infringement.