Amendment to the Decree No. 32 Regarding Protection of the Value of Turkish Currency, Newsletter 2017/4, dated July 3, 2017
The Decree No. 32 Regarding Protection of the Value of Turkish Currency was amended through the Decree, which was published in the Official Gazette dated July 3, 2017 No. 31113. The amended sub-paragraph 9 of Article 6 stipulates that “The leveraged transactions and derivatives transactions of those subject to rules and regulations applicable to leveraged transactions shall only be made by Turkish residents through intermediary institutions licensed by the Capital Markets Board of Turkey”.
The revoked provision of sub-paragraph (e) of Article 15 was re-introduced stipulating that “Turkish residents are free to sale and purchase of leveraged transactions and derivatives instruments of those subject to rules and regulations applicable to leveraged transactions only through intermediary institutions licensed by the Capital Markets Board of Turkey”.
As per the new rules the Turkish residents, that would cover real persons who do have a permanent residence or live more than 180 days within a calendar year; or legal persons having their registered seat within the borders of the Republic of Turkey (the “Republic”), are obliged to use intermediation services of intermediary institutions (brokerage houses) licensed by the Capital Markets Board of Turkey for products/instruments traded at FX markets (i.e. ordinary fx transactions, CFDs). Given that the Capital Markets Board of Turkey cannot extend licenses to non-Turkish institutions, we are reasonably of the opinion that the intermediary institutions licensed by the Capital Markets Board of Turkey definition covers only the intermediary institutions incorporated in the Republic. As per the provision of sub-paragraph 1 (b) of Article 11 of the Communiqué No. III-37.1 on Principles Regarding Investment Services, Activities and Ancillary Services, receiving and transmitting orders to non-Turkish resident investment firms by the intermediary institutions in the Republic was already not permissible. However, before implementation of the amendments to the Decree Law No. 32, the Turkish residents were permitted to perfect leveraged transactions and derivatives instruments of those subject to rules and regulations applicable to leveraged transactions without using services of the intermediary institutions (in the Republic). Through this change the Turkish residents are absolutely restricted to enter into leveraged transactions and derivatives instruments of those subject to rules and regulations applicable to leveraged transactions outside of the Republic.
Breach of the rule of the amended sub-paragraph 9 of Article 6 of the Decree Law No. 32 would be subject to administrative fine variable between TRY 3,000.00 to TRY 25,000.00.
göktaş Attorneys-at-law