On December 9, 2021, the Turkish Competition Authority (“Authority”) published its report entitled “Analysis Report on the Financial Technologies in Payment Services” (“Report”) which evaluates the effect of the use of financial technologies (“Fintech”) in the financial sector, the obstacles to innovation and competition in the relevant markets and the entry of big technology (“Big Tech”) companies (e.g., Facebook, Amazon, Google, Apple) into the market. The Report notes that Fintech includes: (i) innovative products and services that emerged in the financial sector as a result of the radical technological transformation, (ii) new entrants other than the incumbent players that offer these services, and (iii) Big Tech companies which started to offer financial services.

Although it is the first thing that comes into mind, share acquisition is not the only way to acquire a target. Turkish laws allow acquisitions to be completed through a number of other methods such as asset acquisitions, business acquisitions and merger, depending on preference of the buyer. This article will explain the processes for the acquisition methods concerning joint-stock and limited liability companies covering the requirements for valid acquisitions and matters to consider.

A new law proposal amending certain provisions of Law No. 5651 on Regulation of Broadcasts via Internet and Prevention of Crimes Committed through Such Broadcast and Turkish Criminal Code is submitted before the relevant commissions of Grand National Assembly of Turkey (“TBMM”) and has been published on TBMM’s website on February 3, 2022.

Corporate governance principles are essential in order to protect benefits of minority shareholders and investors. Appointment of independent members is one of the most important elements that ensure proper implementation of the corporate governance principles. As a part of corporate governance principles regulated under the capital market legislation, independent board members must be appointed by the companies who are expected to objectively supervise the company and enlighten the public if necessary. It is important to have an independent member who will execute his/her duties without being influenced in order to create reliable cooperation. 

Companies, for various reasons such as tax benefits, liabilities and as may be required by authorities, may decide to change their legal types. Turkish corporate law allows companies to change their types in accordance with Article 181 of the Turkish Commercial Code No. 6102 (the “TCC”) which sets forth which company types are allowed to convert into another.

The Turkish Data Protection Authority (“DPA”) has published Draft Guidelines on Cookies (“the Draft Guidelines”) on January 11, 2022, providing explanations on cookies and practical advices for data controllers who process personal data through the use of cookies.

The Turkish Competition Board (“Board”) has recently assessed the allegations that Allergan Ilaclari Ticaret A.S. (“Allergan”) engaged in discriminatory conduct and abused its dominant position by way of refusal to supply in its preliminary investigation decision. The complainant, Denge Ecza Deposu Ticaret A.S. (“Denge”), alleged that Allergan supplied some of its pharmaceutical products only to certain warehouses, rejected Denge’s request to work with Allergan and hindered Denge’s activities by restricting its access to Allergan’s products. The Board’s decision is remarkable as it assesses the allegations in detail under both Article 4 (anticompetitive agreements) and Article 6 (abuse of dominant position) of Law No. 4054 on the Protection of Competition (“Law No. 4054”) by discussing the competition literature on certain concepts such as indispensability and essential facilities doctrine and making references to the decisional practice in the European Union.

The Advertisement Board rendered an advertisement ban decision and concluded that the use of registered trademarks on a business sign without a contractual relationship with the proprietor of displayed trademarks is an unfair commercial practice. The Advertisement Board’s reasoning is that such use on the business sign without any legal contractual relationship, such as license agreements, creates the wrong impression over the consumer that this particular business is an authorized service shop of the business products bearing the displayed trademarks. The decision of the Advertisement Board is published on the Advertisement Board Meeting Press Bulletin dated May 4, 2021 and numbered 309.

Capital market activities as defined under Article 34 of the Capital Markets Law No. 6362 (the “CML”) are activities of capital market institutions falling within the scope of CML, investment services and activities and other ancillary services falling within the scope of the CML. In order to carry out capital market activities, permission of the Capital Markets Board of Turkey (the “Board”) is required. Obtaining permission is particularly important given that the consequences of determination by the Board that such activities are carried out without the permission from the Board may have severe consequences.

In terms of Turkish corporate law perspective, different types of privileges may be granted to certain shares during drafting the articles of association while a joint-stock company is being established or by way of amending articles of association of an already established joint-stock company. These privileges may be on dividend right, liquidation share, pre-emptive right, voting right and other similar rights. In this regard, the shareholders holding privileged shares in a joint-stock company are deemed privileged shareholders. In this article, we will focus on rights of privileged shareholders and relevant procedures that need to be followed for the circumstances that may affect interests of privileged shareholders within the framework of Article 454 of the Turkish Commercial Code No. 6102 (“TCC”) and the Regulation on the Procedures and Principles of General Assembly Meetings of Joint-Stock Companies and Ministry Representatives Attending the Meetings.

Cartel facilitators are viewed as possible instruments for undertakings to disguise their restrictive agreements and to get around competition law obligations. The approach that enables third parties to be held liable as “cartel facilitators” under the EU competition law dates back to the 1980s, when the European Commission (“Commission”) decided for the first time in Italian Cast Glass that the third party, which was not active in the affected market but enabled and assisted the implementation of the restrictive behavior, was jointly liable for the cartel.

So far, 2021 has seen less activity in terms of enforcement actions under the Foreign Corrupt Practices Act ("FCPA"), compared to 2020. In 2021, the United States Department of Justice ("DOJ") took a total of 19 enforcement actions, and the Securities and Exchange Commission ("SEC") took a total of 4 enforcement actions. Therefore we observe that the DOJ has been a lot more active than the SEC in terms of the number of enforcement actions this year.

Former Counsels Eda Duru and Onur Ozgumus have been promoted to Partner at ELIG Gurkaynak in a promotion round that saw five other lawyers promoted to Counsel.

Regulation on Sharing of Secret Information ("Regulation") issued by the Banking Regulation and Supervision Agency ("BRSA") has been published in the Official Gazette numbered 31501 and dated June 4, 2021 and will enter into force on January 1, 2022. The purpose of the Regulation is to determine the scope, form, procedures and principles regarding the sharing and transfer of bank secret and customer secret information, and the Regulation introduces detailed regulations regarding the confidentiality obligation. In this regard, we will focus on the new regulations introduced by the Regulation.

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.

Former Turkish Competition Authority Chief Legal Counsel Harun Gunduz has moved into private practice by joining ELIG Gurkaynak Attorneys-at-Law.

I can pinpoint the exact moment when my interest in the law first flourished: I was 13 years old and my mother had given me a book called The Courage of their Convictions by Peter H. Irons, about 16 Americans who had fought for their rights and taken their cases all the way to the Supreme Court, and what I read resonated deeply within me. It later turned out that my mother had only given me the book to improve my English. But it opened the door to so much more.