Frequently Asked Questions
In this section, you will find our responses to the questions most frequently asked. These responses are intended to help you in choosing what course of action to follow. However, they are for information purposes only and you should not consider these responses to be legal advice. We do not accept liability for the information provided.
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Published on 01 August 2015
1. What is Foreign Capital? Which Investment Vehicles are Available to foreign investors in Turkey?
“Foreign capital” is acquisition of wealth in a country other than the country where the investor resides. Investments in securities, such as bonds and foreign equity securities are referred to as “portfolio investments,” and are classified under the category of “indirect foreign capital investment”. Establishment of companies by foreign investors, either directly or with a Turkish partner; acquiring stocks of an existing company, and acquisition of immovable properties investment such as buildings, factories and land, or production facilities are deemed direct foreign investment. In addition, foreign capital can enter the financial markets of a country through credit markets and external loans.
Pursuant to Paragraph (a) of Article 2 of the Foreign Direct Investment Law (“FDIL”), dated June 5, 2003 and numbered 4875, published in the 17.06.2003 issue of the Official Gazette, a foreign investor is defined as (i) a real person of foreign nationality or Turkish national resident abroad and or (ii) a foreign legal entity established under the laws of a foreign country or (iii) any international institution investing directly in Turkey.
Paragraph (b) of the same article defines foreign direct investment as (i) establishment of a new company or branch, or (ii) participation in an existing company either by acquisition of shares outside the stock exchange or by acquisition of shares through the stock exchange which represent at least 10% of the capital or grant voting rights in the same proportion,
Foreign investors are entitled to bring capital in cash in the form of convertible currency purchased and sold by the Central Bank of the Republic of Turkey, stocks and bonds of foreign companies (excluding government bonds), machinery and equipment, or industrial and intellectual property rights from abroad in order to establish a new company or to participate in an existing company. They are also entitled to use dividends, earnings, receivables and other investment-related rights having financial value, or rights related to exploration and extraction of those natural resources acquired in Turkey to establish a new company or to participate to an existing company.
Foreign investors interested in establishing a new company in Turkey generally prefer to establish joint stock or limited companies, or an ordinary partnership. However, foreign investors are also permitted to establish unlimited companies, and a branch or liaison office in Turkey. It is required to obtain permission of the General Directorate of Internal Trade of the Ministry of Industry and Commerce to establish a branch of a foreign company. Besides, there are some specific procedures to be followed before the General Directorate of Internal Trade of the Ministry of Industry and Commerce.
The establishment of a liaison office provides the simplest vehicle with which foreign investors may establish a presence in Turkey. Unlike a branch office, a liaison office is not permitted to engage in any commercial activity in Turkey. However, the gathering of information, conduct of market research, translation of documents and correspondence, visiting of clients and orchestration of travel arrangements are not considered “commercial activity” and would be permissible.
2. Which rules apply to foreign investment?
Pursuant to Article 3(a) of the FDIL, foreign investors are free to invest directly in Turkey, and are subject to equal treatment with domestic investors, unless otherwise stipulated by law or in international treaties. Therefore, notwithstanding the restrictions set forth in international treaties and law and provided that the proposed investment is contrary to public order, health, security and interests, sector specific restrictions previously set forth under law are not applicable anymore.
However, there are still some foreign ownership restrictions set forth under specific legislations. For example, Article 29/1(h) of the Television and Radio Broadcasting Law numbered 3984 restricts the percentage of foreign capital in a television and broadcasting company to 25%. Similar restrictions can be found in ground services regulations for civil aviation; the Cabotage Law regarding maritime security, the Auquacultural Resources Law numbered 1380, and the Electricity Market Law numbered 4628.
Pursuant to Article 3(b) of the FDIL foreign investments can be expropriated or nationalized only for the purpose of the protection of public interest in return for compensation.
As per Article 3(c) of the FDIL, foreign investors are free to transfer abroad (i) the net profits and dividends generated from commercial activities and transactions conducted in Turkey, (ii) proceeds resulting from the sale and liquidation of all or any part of the investment in Turkey, (iii) payments made under license, management and similar agreements and (iv) interest and reimbursements arising from foreign loans, through banks or private financial institutions.
Pursuant to Article 3(e) of the FDIL, foreign investors are entitled to apply either to authorized local courts or national and international arbitration to settle any disputes arising from both investment agreements subject to private law and public service concession contracts.
3. Which Rules Apply to the Acquisition of Real-Estate by Foreigners in Turkey?
As per Article 3(d) of the FDIL, companies established in Turkey by or associated with foreign investors are free to acquire the title or limited real rights of an immovable property located in those areas which are open to Turkish citizens. Foreign investors and Turkish citizens are treated equally in terms of acquisition of immovable property in Turkey.
It is important to note that Article 3 (d) of the FDIL regulates acquisition of an immovable property by those companies established by foreign investors or those in which foreign investors are shareholders. Acquisition of real estate by foreign individuals and/or legal entities is subject to the Title Deed Act dated 1934 and numbered 2644 (the “TDA”).
Pursuant to Article 35 of the TDA, provided that the mutuality criteria and legal requirements have been met, foreign real persons are permitted to acquire immovable property that has been properly defined and registered as a place of business or residence in the implementation plan or local development plan of the city prepared by the relevant municipality. The same conditions apply to foreigners who wish to acquire limited rights in rem on an immovable property. However, the ownership of immovable property and limited rights in rem to be acquired by a foreign individual in Turkey shall not exceed 2,5 hectares in total.
The total area of the immovable property to be acquired or be made the subject of limited rights in rem by all foreign individuals shall not exceed 10% of the total area of the piece of land covered by the implementation plan or local development plan of the relevant central district or town. However, taking into account the importance of central districts and towns in terms of their infrastructure, economy, energy, environment, culture, agriculture and security, the Turkish Council of Ministers is empowered to determine a different rate which shall not exceed 10%.
As per Article 36 of the TDA, companies established by or associated with foreign investors in Turkey are permitted to acquire the title or limited rights in rem on an immovable property to conduct the business indicated in their articles of association. The same conditions apply to immovable properties transferred to another company established in Turkey with foreign capital, as well as any company originally established with national capital and subsequently transformed into a foreign-owned company through share transfer. Pursuant to the Law on Military Forbidden Zone and Military Security Zones, acquisition of immovable property in military, security and strategic zones by these companies is contingent upon the approval of the Office of the Commander-in-Chief or the authorized command post. Acquisition of immovable properties located in special security zones is subject to the approval of the province where the immovable property is located.
Published on 01 August 2015
1. Which regulatory body is responsible for the supervision of the insurance and reinsurance industry in Turkey?
The insurance regulatory agency in Turkey is the General Directorate of Insurance of the Undersecretariat of the Treasury.
2. What is the relevant legislation governing insurance regulatory matters and insurance contracts?
The framework of the regulation of the insurance sector is provided by the Act on Insurance, Number 5684, introduced on 14 June 2007, as a result of the emerging needs of the rapidly growing sector for international standards, such as more effective supervision and transparency, compliance with European Union (EU) standards. Secondary legislation has and is being replaced accordingly.
Insurance contracts are governed by the Insurance Section of the Turkish Commercial Code of 1956. A new Commercial Code introducing substantial improvements to insurance provisions was introduced on January 13, 2011 and will enter into force as of July 1, 2012.
3. How can an insurance company operate in Turkey?
An insurance company in Turkey can only operate in the form of a joint-stock company or, in the case of mutual insurance funds, a cooperative company. The establishment of a joint-stock insurance company is generally subject to the rules for the establishment of a joint-stock company as set out in the Commercial Code, with certain exceptions and further requirements as to form and procedure. Insurance companies can only engage in insurance business and the other businesses which are directly related with the insurance business.
4. Are there any licensing requirements for the operation of insurance companies?
Upon establishment, an insurance company is required to obtain a license from the Undersecretariat of the Treasury for each insurance field the company is going to operate in. An insurance company is not allowed to be active in both life and non-life insurance divisions.
5. Is there any capital requirement for insurance companies operating in Turkey?
The minimum paid share capital of an insurance company must be YTL 5 million paid in cash. The Undersecretariat of the Tresury is entitled to raise the amount at the stage of licensing depending on the extent of licensing requests of the company.
6. Are foreign insurance companies admitted to operate in Turkey?
Foreign insurance companies may operate in Turkey through establishment of a company in Turkey or thorough acquisition of shares in an existing company. In the first option the new company would be a Turkish company incorporated with foreign capital. Foreign insurance companies may also operate in Turkey by opening a branch office. Unlike liaison offices, which are not allowed in case of insurance companies, a branch office may engage in commercial activities. The general directorate of the Ministry of Internal Industry and Commerce is entitled to issue the permit for opening a branch. The amount of paid-up capital of these companies cannot be less than the amount determined for the insurance and reinsurance companies established in Turkey. Besides, these companies should not be prohibited from carrying on insurance business in the countries where they originally operate.
7. Are Turkish residents allowed to insure their insurable interests abroad?
Turkish residents must insure their insurable interests in Turkey with an insurance company admitted in Turkey. The Insurance Act provides following exemptions, the scope of which the Council of Ministers is authorized to expand:
- Freight insurance for import and export goods;
- Insurance to be provided for aircrafts, ships, helicopters which are purchased with foreign loans, exclusively limited to the loan amount and applicable for the term until the foreign debt is paid up, or limited to the period of financial leasing if the same are brought home by financial leasing obtained abroad;
- Liability insurance with respect to operating of ships;
- Life insurance;
- Personal accident, sickness, health or motel vehicle insurance, limited to the time of the insured’s stay abroad or their temporary stay abroad.
8. What are the requirements for the formation of an insurance contract?
Formation of an insurance contract is not subject to any formal requirement for validity but to the general rules of contract formation provided by the Turkish Code of Obligations. As a result insurance contracts are concluded upon the parties’ mutual declaration of intention. Contracts above TL 590.- are however subject to written form for purposes of proof with respect to the existence, scope and content of the contract.
The Commercial Code requires the insurer to issue a policy setting out the mutual rights and obligations accompanied by general conditions confirmed by the Undersecretariat of the Treasury and signed by the insurer. This is, however, not condition for validity but rather a regulatory requirement for the protection of the insured.
9. How is the scope of an insurance contract determined?
Insurance contracts are in principle subject to freedom of contract. The parties are free to determine special conditions subject to the mandatory and semi mandatory rules provided by the Turkish Commercial Code. The special conditions must not be contrary to the general conditions approved by the Undersecretariat of the Treasury for relevant insurance types to the extent general conditions reflect mandatory or semi mandatory rules.
10. Are the parties to an insurance contract free to choose a foreign jurisdiction in their insurance disputes?
The Turkish Code of International Private Law numbered 5718 has designated specific jurisdictions for the cases arising from insurance contract disputes, and clearly states that they cannot be contracted otherwise by the parties. Article 46 of the Code provides that the relevant jurisdictional rules shall prevail:
The court where the insurer’s headquarters, or its branch office or the agent who concluded the contract are located in Turkey, has jurisdiction in the disputes arising from insurance contacts. In the cases to be filed against the insured or the beneficiary, the court of the Turkish domicile of these persons has the jurisdiction.
11. Are the parties to an insurance contract permitted to chose a foreign applicable law to disputes arising from that contract?
The parties to an insurance contract are permitted to choose a foreign law to be applicable to that contract. The Turkish Court of Appeal has not found the presence of a foreign element required for the selection of a foreign law to be used for the resolution of any potential dispute.
12. Are the parties to an insurance contract permitted to agree upon an arbitration clause in the event of any potential dispute?
The parties to an insurance contract are permitted to agree on submission of disputes to ad hoc or institutional arbitration.
It is also possible to refer to “expert arbitrator” whereby the parties to an insurance contract agree on the determination of the loss arises within the scope of the insurance contract as a result of an examination to be conducted by an expert arbitrator. The conclusions of such an examination would be binding on the courts as well as between the parties who agreed on expert arbitration.
An insurance arbitration commission was established in 2007 by the Turkish Association of Insurance and Reinsurance Companies and operating since on various insurance disputes.
13. Does competition law apply to insurance companies?
The Act no 4054 on the Protection of Competition also applies to the insurance sector. A Block Exemption Communiqué regarding the insurance sector parallel to EU Commission Regulation 358/2003 of 27 February 2003 was published in the Official Gazette on 1 February 2008 and is in force.
Published on 01 August 2017
1. Are foreign plaintiffs who wish to initiate legal proceedings in Turkey subject to any bond requirements?
Pursuant to the International Private and Civil Procedure Law, foreign persons or legal entities who initiate or intervene in legal actions or initiate execution proceedings are required to deposit a guarantee to be determined by the court that will be used to bear the judicial expenses as well as to compensate the counterparty for any damages that may occur.
However, if an applicable reciprocity agreement between Turkey and the foreign plaintiff’s country of origin exists, the court may exempt the party who initiated the legal proceedings from such payment.
(For the list of the Convention Countries exempt from the bond requirement, please see: http://www.uhdigm.adalet.gov.tr/yedek/b2-sozlesmeler/sozlesmeler/03-laheysozlesmeleri/laheytaraflar.xls).
2. Does Turkey require foreign court decisions to be domestically ratified or recognized?
An award rendered pursuant to legal (civil) proceedings initiated in a foreign country that becomes final under the laws of that country could be enforced in Turkey only in the presence of an enforcement decision rendered by the competent Turkish Civil court. If a party wishes to enforce a foreign court decision in Turkey, that party should file a lawsuit for enforcement before the Turkish courts.
The conditions of the enforcement are regulated under the International Private and Civil Procedure Law. Pursuant to the Law, the conditions under which the enforcement request can be filed are as follows:
- There shall be an agreement based on the reciprocity principle between Turkey and the state in which the foreign decision has been rendered, or a legal provision or a de facto application of that state which enables the enforcement of the awards rendered by Turkish courts;
- The foreign decision shall not be rendered on a dispute under the exclusive jurisdiction of the Turkish courts; or, (provided that the defendant has opposed to the decision) the decision shall not be rendered by a court which is considered to have jurisdiction despite having no actual relevance with the parties or with the subject of the lawsuit;
- The decision shall not be in explicit contravention of the principles of Turkey’s public order;
- If the person against whom the enforcement request is addressed has not been duly invited to the court according to the laws of the country where the decision has been rendered; or if he has not been represented therein, or if the decision has been rendered unlawfully in his absence as against the provisions of the applicable laws of that country and that person has not opposed to the enforcement request before the Turkish courts, on these same grounds.
Please also note that the conditions above must be met if a foreign decision is to be recognized by the Turkish courts, except for the condition regarding the presence of “a reciprocity agreement concluded between Turkey and the country in which the foreign decision is rendered; or a legal provision or a de facto application of that country enabling the enforcement of the awards rendered by Turkish courts,” namely the applicability of the reciprocity principle.
For the list of the countries that have concluded reciprocity agreements with Turkey, please see: http://www.uhdigm.adalet.gov.tr/ts.htm
3. Does Turkey require foreign arbitral awards to be domestically ratified or recognized?
Foreign arbitral awards which are final and enforceable, or are binding upon the parties concerned, can be ratified in Turkey. Indeed in order to enforce a foreign arbitral award in Turkey, an enforcement decision should be obtained from the Turkish courts.
The conditions in which the Turkish courts would seek to enforce a foreign arbitral award are as follows:
- A valid arbitration agreement shall exist;
- The arbitral award shall be final and enforceable or shall be binding upon the parties concerned (or has not been set aside or suspended by a competent authority);
- The subject matter of the dispute shall be arbitrable;
- The party against whom the arbitral award was rendered shall be notified properly with regards to the arbitration proceedings or the appointment of the arbitrator;
- The arbitral award shall not be in explicit contravention of the principles of Turkey’s public order.
The recognition of the arbitral award is subject to the same provisions as the provisions concerning enforcement.
4. What is the general legal procedure for debt collection?
Pursuant to the Turkish Law, the creditor can directly initiate execution proceedings before the execution offices for the collection of his receivables. Pursuant to the Execution and Bankruptcy Law, in order for the creditor to initiate such proceedings, a court decision or any other document (deed) is not required. However, proceedings initiated in such a manner will only be successful unless the debtor objects to the proceedings. If the debtor files an objection within due course, the execution proceedings will automatically cease.
It is incumbent upon the creditor to reactivate the ceased proceedings. The creditor can continue the proceedings upon the cancellation/removal of the objection which is to be sought by filing a lawsuit either to remove the objection before the execution court or to cancel the objection before the civil court. In those proceedings, if the court confirms the existence of the debt, the courts would cancel/remove the objection and decide for the continuation of the execution proceedings. Furthermore, in cases where the necessary conditions are met, the court may render an additional compensation amounting to 20% of the total receivables in favor of the creditor due to the debtor’s unjust objection to the execution proceedings.
5. Is litigation in Turkey subject to any specific expenses?
Judiciary services in Turkey are subject to certain fees the types, rates and amounts of which are regulated by the Law of Fees. In the most general sense, the judiciary expenses are divided in two categories as application fee and judgment and writ fee.
The application fee is a fixed fee obtained from the applicant in advance as a condition of filing the lawsuit. Depending on the nature of the application, the judgment and writ fee can be either fixed or proportional. Whereas a fixed judgment and writ fee applies for the cases the subject of which concerns a non-monetary claim, the cases which concerns a monetary claim subject to a proportional judgment and writ fee determined over the amount in dispute.
Fixed fees are collected in advance, before the relevant action occurs. One quarter of the relative judgment and writ fees is collected in advance at the time of the filing of the lawsuit, and the remaining three-quarters of the amount is collected once the decision has been rendered. In the case that a lawsuit is dismissed the fixed judgment and writ fees will be collected even though the lawsuit has been subject to the relative judgment and writ feesIf any, the excessive part of the judgment and writ fee which has been deposited in advance is refunded upon request. Pursuant to the current legislation, the rate for proportional judgment and writ fees is the 68,31‰ of the requested amount. For further information with regards to the fees and rates, please see:
6. What are the conditions of preliminary injunction?
Pursuant to the Code of Civil Procedure, a preliminary injunction decision might be granted in case there is a possibility which makes it materially difficult or impossible to acquire a certain right due to the changes in current conditions or there is a concern for the occurrence of an inconvenient situation or possibility for significant damage due to the delay. However, a preliminary injunction decision resolving the dispute on the merits of the case cannot be granted.
The requesting party must explicitly state the grounds and type of the injunction in its application petition. It is sufficient for the applicant to prove the likelihood of the existence of the conditions required for granting an interim injunction. If the circumstances necessitate an immediate action for the protection of the rights of the requesting party, interim injunction decision might be granted without hearing the other party. In the injunction decision, the court specifies the amount and the type of the security to be deposited by the requesting party. The amount or rate of the security is not regulated under the relevant legislation. However in practice, preliminary injunction decisions are granted in exchange of a security amounting approximately to 15% of the dispute value which will be deposited in cash or in the form of a letter of guarantee.
If the preliminary injunction request is filed before filing of the main lawsuit on the merits of the case, the request should be filed before the court having jurisdiction over the dispute. If the preliminary injunction is requested during the course of a pending lawsuit, then the request should be made before the court which hears the case.
7. What are the mandatory and optional components of an arbitration agreement?
Pursuant to the International Arbitration Law, arbitration agreement is an agreement under which the parties agree for resolution of all or part of the disputes arising or to be arisen from a present legal relationship, either contractual or not, through arbitration. As validity conditions, the parties must express their intentions to arbitrate explicitly in writing which could be made as either an arbitration agreement or a clause, and their consent must be free of any kind of doubt.
Although being optional, it would be practical for the parties to agree the number and appointment of arbitrators, the language and seat of arbitration and also the applicable law under their arbitration agreements.
8. Is general authorization sufficient for representation in the arbitration in Turkish law?
Pursuant to the Code of Civil Procedure, an attorney must be specifically authorized in order to realize certain actions, which include “concluding an arbitration or arbitrator agreement”. Therefore, the attorney is granted a a general authorization, he/she cannot take any action (including signing an arbitration agreement) on behalf of his/her client unless explicitly authorized otherwise.
On the other hand, persons forming the bodies of the legal entities, which are authorized to act on behalf of the legal entity, do not act as representatives but as the legal entity itself, therefore no specific authority is required.
9. What is the lapse of time to set aside an arbitral award and what are the grounds?
Pursuant to the International Arbitration Law, an action to set aside an arbitral award shall be filed within thirty days. The period starts as of the notification of the arbitral award or the decision regarding amendment, interpretation or completion to the parties. If an action to set aside is filed, the execution proceedings of the arbitral award will automatically cease.
The court can only examine the arbitral award limited to the following grounds which are stipulated in the International Arbitration Law:
- Incompetence of one of the parties to the arbitration agreement, or invalidity of the arbitration agreement as per the applicable law or if there is no such law, as per the Turkish law
- Breach of the procedure agreed for the appointment of the arbitrator or arbitral tribunal under the arbitration agreement or foreseen in the Law
- Exceeding the arbitration time limit in the issuance of the final award
- Arbitrator’s or arbitral tribunal’s incorrect ruling on the competence or incompetence
- Arbitrator’s or arbitral tribunal’s ruling on a matter falling outside of the scope of the arbitration agreement or not ruling for all matters set forth in the claims or exceeding their authority
- Conduct of the arbitration proceeding in contradiction with the procedure agreed under the arbitration agreement, or if there is no such agreement, under the International Arbitration Law, and existence of an effect of such inconformity on the merits of the award
- Breach of the principle of equality of the parties
- Non-arbitrability of the matter of the dispute subject to the arbitral award as per the Turkish law
- Breach of the public order
The action to set aside shall be filed before the competent civil court of first instance which is the court located in the same place as the respondent’s residence or the ordinary domicile or the workplace. If the respondent does not have a residence address, ordinary domicile or workplace in Turkey, the competent court is Istanbul Civil Court of First Instance.
10. What is the time limit to file an action in administrative jurisdiction?
As per the Administrative Procedure Law, the time limit to file an action is sixty days for the actions to be filed before the Council of State and administrative courts, and thirty days for the actions to be filed before the tax courts, unless otherwise stated in the specific laws.
In terms of administrative disputes, the time limit start running from the date on which the notification is made. For tax related disputes, where the accrual is dependent on the collection, the time limit starts running from the date of collection; where there is a notification or another action replacing the notification, it starts running from the date of the notification or the date of the action that replaces the notification. In terms of taxes which are collected by deduction, the start of this time limit is the day following the date of the payment to the right-holder; and in terms of the taxes which requires registration, it is the day following the date of the registration. Finally, in cases where the administration must bring an action, the start of the time limit to file an action is the day following the date on which the relevant decision of the authority or commission arrives to the administration.
Before bringing an action and within the abovementioned time periods, the superior administrative authority, or if there is not a superior authority, the administrative body which has performed the action might be requested to abolish, withdraw or amend the administrative action or to perform a new action. This application shall cease the time limit that has started to run. If no response is given within sixty days, the request shall be deemed to be dismissed. When the application is dismissed or deemed to be dismissed, the time limit to file an action resumes and the period passed until the application date is also added.
Published on 01 March 2017
1. Is an employment contract required to be in writing?
In principal, an employment contract is not subject to any form requirements unless otherwise specified in law. Written form is mandatory for fixed-term employment contracts. However, if the contract is not to be concluded in writing, then it is necessary to provide the employee with a written document, within two months at the latest, showing the general and special conditions of work, the daily or weekly working time, the basic salary and any salary supplements, the time intervals for remuneration, the duration if it is a fixed-term contract and conditions concerning the termination of the contract.
2. What is the weekly working time?
The maximum weekly working time is 45 hours. Unless otherwise agreed, this period is divided equally between the working days of the workplace.
3. How the payments for overtime work are calculated?
Hours exceeding the limit of 45 hours per week are overtime hours. The payment to be made for each hour of the overtime work is paid by increasing the amount of salary per hour by 50%.
For the employees whose weekly working hours are designated less than 45 hours a week, the payment to be made for each hour of the overtime work up to 45 hours is paid by increasing the amount of regular salary per hour by 25%.
4. How long the minimum rest breaks should be?
The minimum duration of the rest breaks are regulated according to the total working hours.
|Duration Of Work||Minimum Duration of the Rest Breaks To Be Taken|
|4 hours or shorter||15 minutes|
|Between 4 and 7.5 hours||30 minutes|
|Longer than 7.5 hours||1 hour|
These periods can be increased by the employer with the employment contract.
5. What is the duration of annual leave?
Unless otherwise in agreed under the employment contract, an employee must have been working in a workplace or different workplaces belonging to the same employer for at least 1 year in order to be entitled for annual paid leave.
|Period of Employment||Annual Paid Leave Period|
|1 to 5 years (including 5 years)||14 days|
|5 to 15 years||20 days|
|15 years and over||26 days|
The length of annual paid leave to be granted to the employees aged 18 or younger and 50 and older cannot be less than 20 days.
6. How long is the statute of limitations for the employment claims?
In principle statute of limitations for the employment claims is 5 years.
7. Which courts have jurisdiction on the disputes arising out of labor law and are there appeal and cassation phases?
Disputes related to labor law and social security law are resolved by labor courts. However, if there is no separate labor court in the place where the action would be initiated, Civil Courts of First Instance resolve the disputes with the capacity of Labor Courts.
It is possible to appeal against the decisions given by the labor courts. Decisions rendered by the labor courts can be subject to examination before Regional Appellate Courts within two weeks as of the notification of the court’s decision.
However, decisions related to a monetary value exceeding TRY 3.560 are final and cannot be subject to appeal. On the other hand, decisions related to personal rights matters or without a monetary value such as re-instatement actions are subject to appeal without any limitation.
Decisions given by Regional Appellate Courts related to non-monetary disputes and decisions rendered for the disputes amounting more than TRY 47.530 can be subject to examination before the Supreme Court within two weeks as from the notification date of the regional appellate court’s decision. However, decisions regarding the re-instatement cases cannot be appealed; after the decision of the first instance labor courts, the parties can only apply to regional court of appeal.
8. Is it mandatory to apply for mediation before initiating an action in disputes arising from labor law?
In Labor Courts Act, applying for mediation is regulated as a cause of action; therefore, for the lawsuits filed for employee-employer claims, compensations and re-instatement, parties shall apply for mediation before initiating an action.
However, mandatory mediation does not apply to the actions for pecuniary or non-pecuniary damages arising from work accidents or occupational diseases and recourse actions related to these.
9. Is it possible to resolve disputes arising from labor law through arbitration?
In principle it is not possible. However, if the parties agree upon after termination of the contract, it is possible to bring the re-instatement actions only before an ad hoc arbitrator.
10. Is it possible to choose the applicable law for the disputes arising from labor law?
As per the Turkish International Private and Procedural Law, employment contracts are subject to the law chosen by parties, provided that the minimum level of protection assured by the mandatory provisions of the habitual work place law are reserved. Therefore, the parties may chose the law to be applied to the employment contract if there exist is an element of foreignness.
11. How should the notice of termination be made?
The notice of termination must be clear and in writing and shall contain the reason of termination and made in writing. However, it is not necessary to rely on a valid reason in termination of employment contract of an employee who is not entitled the protection provided by the “job protection provisions”.
12. Should the employee’s defense be taken before the termination?
If the employment contract of an employee who is protected under the “job protection provisions” is terminated for a reason related to his/her behavior or performance, his/her written defense should be taken before the termination.
Published on 01 September 2017
1. What is the international legal framework for anti-corruption in Turkey?
Turkey is signatory to several conventions, the most important of which are:
- the United Nations Convention against Corruption
- the United Nations Convention against Transnational Organized Crime;
- the OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions
- the Council of Europe Criminal Law Convention on Corruption
- the Council of Europe Civil Law Convention on Corruption
- the Council of Europe Convention on Laundering, Search, Seizure and Confiscation of the Proceeds from Crime and on the Financing of Terrorism
In addition, Turkey has been a member of the Financial Action Task Force (FATF) since 1991 and the Group of States against Corruption (GRECO) since 2004. In line with the suggestions of GRECO, the Turkish government adopted, in July 2014, the decision on the approval of the Additional Protocol to the Criminal Law Convention on Corruption as a law, which extends the scope of the Convention to arbitrators and jurors.
Turkey is also a member of the Agreement for the Establishment of the International Anti-Corruption Academy as an International Organization.
2. What is the domestic legal framework for anti-corruption in Turkey?
Turkey’s primary anti-bribery and anti-corruption legislation is contained in the Turkish Criminal Code (‘TCC’) No 5237, amended to its current version in 2012. This is complemented by various laws and regulations, amongst which The Law on Anti-Money Laundering No 5549 and The Law on Declaration of Property, Bribery and Anti-Corruption No 3628 stand out.
The TCC is the main legislation dealing with various forms of corruption including bribery, fraud, embezzlement and misconduct. The law provides a broad and contemporary definition of bribery. The provision goes beyond the classic definition of a public official to extend to people representing entities like companies established with public institution participation, public benefit associations, and open joint stock companies. The use of intermediaries for bribery is explicitly prohibited by the law. Bribing foreign officials in the course of conducting international business also constitutes an offence under the TCC.
The Anti-Money Laundering Law provides a system whereby suspicious financial transactions are scrutinized by the Financial Crimes Investigation Board (MASAK). The Law on Declaration of Property, Bribery and Anti-Corruption provides imperative measures for the public officials to prevent corrupt practices.
3. What is the definition and scope of the bribery offence?
Bribery and its elements are described under Article 252 of the TCC amended to its current version in 2012. Under the Turkish law “providing a benefit directly or through an intermediary to a public official or another person appointed by a public official to perform, or not to perform, a task regarding the performance of the official’s duties” constitute the bribery offence.
Bribery is considered to be a reciprocal offence. For this offence to be committed, an agreement must be reached between the briber and the public official.
4. How public official is defined under Turkish law?
Article 6/1(c) of the TCC defines the public official as ‘any person selected or appointed to carry out public duty for a temporary or permanent period’.
Article 252/8 extends this scope by introducing through including the below listed individuals as public officials within the scope of the offence:
- professional organisations that are public institutions;
- companies that have been incorporated by the participation of public institutions
- entities, or professional organisations that are public institutions;
- foundations that are engaged in activities within a body of public institutions or entities, or professional organisations that are public institutions;
- associations working for the public interest;
- cooperatives; and
- publicly held joint-stock companies.
Given the above, in a scenario where a lawyer provides a benefit, on behalf of his or her client, to a CEO of a publicly held company to perform, or not to perform, a task regarding his/her performance, he or she will be regarded as committing the offence of bribery.
5. Is foreign bribery an offence? Can foreign companies be prosecuted in Turkey for foreign bribery?
Foreign bribery is an offence under the Turkish law. The July 2012 revisions amended the provision penalising the bribery of foreign public officials and widened the scope of the definition of foreign public officials. Under article 252/9, offering, promising or providing a benefit to the below listed officials, directly or through an intermediary, to influence the performance or non performance of an act; or to obtain or retain an improper advantage in relation to international commercial transactions:
- officials who have been elected or appointed in a foreign country;
- officials working in international or supranational or foreign courts (such as judges or members of a jury);
- members of international or supranational parliaments;
- persons who perform a public duty for a foreign country including foreign public institutions;
- citizens or foreign arbitrators who are appointed to arbitrate in dispute resolution; and
- officials or representatives of international or supranational organisations that have been established by international treaties.
Additionally, under Article 252/ 9 a prosecution can be initiated ex officio against foreigners who are involved with bribes paid to foreign officials outside of Turkey in relation to a transaction in which Turkey, or a public institution located in Turkey, or a legal entity established under Turkish laws, or a Turkish citizen is involved.
Under this provision presenting an extraterritorial effect, the foreigners who bribe foreign officials outside of Turkey in relation to Turkish affairs can be subjected to an investigation and prosecution ex officio.
6. Can gifts, travel and entertainment expenses provided to the public official give rise to the bribery offence?
The TCC does not provide for an exception with regards to gifts, travel and entertainment. They may therefore give rise to the bribery offence provided that all the conditions of the offence are fulfilled.
Also, the public officials are subject to the Law on Civil Servants No. 657 dated 14 July 1965. Pursuant to Article 28 of the Law, public officials (civil servants) cannot be involved in commercial activities. In addition, pursuant to Article 29 they cannot receive gifts or gain benefits because of their official duty. Article 15 of the Regulation on the Principles of Ethical Behaviour of the Public Officials provides a list of acceptable gifts and a list that sets outs gifts that are strictly forbidden.
7. Are facilitating payments allowed under Turkish law?
The TCC does not provide for an exception to the bribery offence with regards to facilitating payments. Facilitating payments are therefore not allowed and may give rise to the bribery offence provided that all the conditions of the offence are fulfilled.
8. What are the penalties set forth under the TCC? Is there corporate liability for criminal offences?
The briber, including intermediaries is sentenced to imprisonment from 4 to 12 years. A public official is sanctioned in the same manner.
Where the public official who receives the bribe is a judge, a notary public or a sworn financial consultant, the duration of the imprisonment is increased by one-third.
As Turkish law has the principle of personal liability under Article 20 of the TCC, which states that ‘no punitive sanctions may be imposed for legal entities’, legal entities can only be subject to security measures. These security measures indicated under Article 60 of the TCC include invalidation of the license granted by a public authority; seizure of the goods and pecuniary benefits obtained in relation to commitment of the offence. The company may be subjected to debarment as per the public procurement law as a result of bribery related acts. Additionally, a fine of up to 2 million liras can be imposed as per Article 43/A of the Law of Misdemeanours.
9. Which are the key enforcement authorities? Is there a corruption agency in Turkey?
The authority to prosecute the corruption related crimes rests with the public prosecutor and criminal courts. There is no government agency dedicated to investigate and prosecute corruption related crimes however the Financial Crimes Investigation Board of the Ministry of Finance (MASAK) is provided with a special mandate to address corruption. MASAK is a regulatory body empowered to collect data, request documents from relevant bodies, and, most importantly, convey the investigation files to the competent public prosecutor.
10. Is it possible for the alleged bribe payer to enter a structured settlement with enforcement authorities?
Turkish system do not provide for structured settlement system. Accordingly, resolution of a foreign bribery allegation through a structured settlement is not possible.
11. Are there voluntary disclosure obligations?
The TCC regulates an obligation for those who are informed of a criminal incident to report to competent authorities.
In the existence of this duty, employees who do not participate in but are informed of the crime can be held liable for not reporting the crime (Article 278 of the TCC). The relevant provision foresees a prison sentence up to one year for those who do not report a crime in progress or a completed crime the consequences of which may still be limited if reported to competent authorities.
In addition to this, under article 254 of the TCC,
Published on 01 September 2017
1. Which transactions are subject to notification to the Turkish Competition Authority under the Turkish merger regime?
The Communiqué No. 2010/4 on Mergers and Acquisitions Requiring Authorization of the Competition Authority (“Communiqué No. 2010/4”), entered into force on 01 January 2011, sets out the types of mergers and acquisitions that require notification the Turkish Competition Authority (“the TCA”) for permission and legal validity.
Article 5 of Communiqué No. 2010/4 defines the following transactions as a merger or acquisition:
A merger or acquisition shall arise where a change in control on a lasting basis results from
- A merger of two or more undertakings,
- The acquisition of direct or indirect control by one or more undertakings or one or more persons already controlling at least one undertaking, by means of the purchase of assets or securities or contracts or other means, of the whole or parts of one or more other undertakings,
- A joint venture that performs all the functions of an autonomous economic entity on a lasting basis.
The type of transaction referred to above must be notified to the Competition Board provided that the notification thresholds are met. Pursuant to Article 7 of Communiqué No. 2010/4, transactions have to be notified to the TCA for clearance, where:
- The aggregate turnover in Turkey of the parties to the transaction exceeds TL 100 million (approximately EUR 23,9 million as of September 2017) and the Turkish turnover of each of at least two of the parties to the transaction exceeds TL 30 million (approximately EUR 7,16 million as of September 2017); or
- The Turkish turnover of at least one of the parties to the transaction in mergers and of the business asset or affair in takeovers exceeds TL 30 million (approximately EUR 7,16 million as of September 2017) and the worldwide turnover of at least one of the other parties exceeds TL 500 million (approximately EUR 119 million as of September 2017)
2. How is the turnover calculated within the scope of Communiqué No. 2010/4?
Turnover comprises the net sales achieved in the fiscal year preceding the date of notification, in accordance with a uniform scheme of accounts. In addition, where there is no possibility of determining the turnover comprising the net sales achieved in the fiscal year preceding the notification, the net sales achieved as of the end of the fiscal year closest to the date of the notification shall be taken into account. Turnover generated by sales between the persons or economic units defined under Article 8(1), which is provided below, is not included in the calculation of the turnover. Article 8(6) of the Communiqué provides that when calculating turnover with respect to a foreign currency, the average buying rate in the relevant fiscal year according to the Turkish Central Bank shall be taken into account.
Pursuant to paragraph 1 of Article 8 of Communiqué No. 2010/4, the turnover of an undertaking concerned shall be calculated by consideration of the turnover of the following:
(a) The undertaking concerned, (undertaking concerned refers to the merging parties in the case of mergers, and the acquirer or the persons or economic units subject to acquisition in case of acquisitions)
(b) Undertakings concerned with respect to which statements above the parties have the following rights or powers:
- direct or indirect ownership of more than half of the capital or business assets;
- power to exercise more than half the voting rights; or
- power to appoint more than half the members of the undertaking’s management board, auditory board or the representing members or
- power of administration of the business;
(c) Person or economic units that have the rights or powers listed in (b) over the undertakings concerned;
(d) Person or economic units that have the rights or powers listed in (b) over undertakings in paragraph (c); and
(e) Person or economic units that enjoy the rights and powers in (b) on undertakings listed between (a) – (d).
Other issues that should be taken into account for the calculation of turnover are as follows:
- Article 8(3) provides that where the undertakings concerned jointly have the rights or powers listed in Article 8(1)(b) above, in calculating the turnover of those undertakings, the relevant turnover shall be apportioned equally.
- Article 8(4) provides that where the undertakings concerned jointly enjoy rights in the administration of a joint venture, turnover of this joint venture shall be apportioned equally amongst each right owner.
- Where the concentration consists of the acquisition of parts, whether or not constituted as legal entities, of one or more undertakings, only the turnover relating to the parts which are the subject of the concentration shall be taken into account with regard to the transferor. Any two or more transactions executed between the same persons or undertakings occurring in the meaning of the first sentence within a three year period in the same relevant product market shall be treated as a single concentration for the purposes of calculating the thresholds.
3. Is the notification filed subject to any fees?
No filing fees are required for the notification.
4. Are the parties to a merger or acquisition required to submit the final version of the agreement?
Parties to mergers or acquisitions are required to submit the form annexed to Communiqué No. 2010/4 and the documents listed under Article 11 of the form. The notification form annexed to Communiqué No. 2010/4 requires the submission of the final or the current version of the agreement regarding the transaction. Therefore, Parties to transactions do not have to submit to the TCA the final version of the agreement with the notification form. The regulations do not specify the particular stage at which an agreement would fulfill the definition of “current version of an agreement”, but it may be accepted as the version closest to the final version of the agreement that will not require any substantial changes.
5. How does the decision process work?
According to Article 10 the Act, upon the preliminary examination conducted within 15 days of the date of notification, the Competition Board shall render a decision on the notified transaction. Should the notification have incomplete information or documents, the experts may require completion of such information. The application is deemed to be filed once all required information has been completed upon which the 15 day examination period officially starts.
Pursuant to Article 10(2) of the Act, if the Competition Board does not respond to or does not take any action on the notification, the transaction is deemed to have been cleared and acquired legal validity thirty (30) days from the date of notification. The examination period referred to in the first paragraph may extend in practice, due to the aforementioned thirty (30) days period and additional information and document requirements by case handlers.
As a result of its preliminary examination, the TCA can either
- Prohibit the transaction
- Clear or clear it subject to remedies and conditions or
- Decide to further investigate the transaction.
In case of the latter, the TCA serves to the concerned parties its preliminary objections to the transaction and that the transaction is pending and shall not be put in force until a final decision is rendered. The investigation shall be completed within six (6) months which can be extended once for a period of up a further six months, if found necessary by the TCA.
6. What are the consequences for the failure to notify a transaction?
According to Article 11 of the Act where a transaction subject to notification has not been notified with the Competition Board, the board may start an ex officio examination once it has been informed of the transaction. As result of the examination:
If the Competition Board concludes that the transaction does not create or strengthen the dominant position of the undertakings concerned, as a result of which competition would have been substantially lessened in any market for goods or services within the whole or a part of the country, it will clear the transaction. However, the parties will be fined for failure to notify.
Pursuant to Article 16 of the Act, in case of a failure to notify the parties to the transaction or association of undertakings or their members, will be fined by one thousandth (1‰) of their Turkish annual gross revenue in the preceding fiscal year, and if this cannot be calculated, gross revenue in the closest fiscal year to the decision determined by the TCA. In the case of a merger the fine is imposed on both parties concerned, whereas for acquisitions the acquirer would be fined for failure to notify.
Article 10 of Communiqué No. 2010/4 explicitly states that if agreements are notified after realization of the transaction, penalties are applicable, realization referring to realization of a change in control.
Where the Competition Board finds that the transaction does raise competition concerns according to Article 7 of the Act, in addition to administrative fines, it can decide to require those concerned to abandon the transaction, to dissolve all de facto situations contrary to the law; if possible, and in accordance with the terms and duration to be determined by the Competition Board, to return to the former owners any shares or assets acquired, or if not possible, to assign and transfer those to third parties; to ensure that the acquiring persons in no way participate in the management of undertakings acquired during the period until these are assigned to their former owners or third parties, and to take any other measures deemed necessary.
7. Does the TCA have the authority to on – site examinations? What would be the scope of such an examination?
Pursuant to Article 15 of the Act and Article 15 of the Communiqué No 2010/4, the TCA is entitled to conduct on – site examinations. The officials of the Competition Authority can exercise the following powers during their examination where necessary:
- Examine the books and all kinds of documents of undertakings and obtain copies where necessary
- Require oral or written explanations on specific subjects,
- Examine all kinds of assets of the relevant undertaking.
8. Are the notifications and TCA decisions published?
Pursuant to Article 53 of the Act, the TCA shall announce its decisions on its website without disclosing trade secrets of the parties. Article 12 of the new Communiqué provides that as soon as a notification has been made to the Competition Authority information on the notification with respect to the undertakings concerned and their fields of activity will be published at the web site. Therefore the notification form requires the parties to provide summary information on the nature of the transaction, the affected markets and the fields of activities of the undertakings without referring to business secrets.
9. Are there any regulations exempting agreements containing anti-competitive clauses either individually or as a group from the application of the Competition Act?
The exemption regime in Turkish competition law contains block exemptions and individual exemptions.
Where the cumulative conditions below are satisfied, it may be decided for the agreements containing anti-competitive restrictions to be individually exempted from the application of Article 4 of the Competition Act:
(a) contribution to improving the production or distribution of goods or to promoting technical or economic progress,
(b) allowing consumers a fair share of the resulting benefit,
(c) not eliminating competition in the relevant market substantially, and
(d) not imposing on the undertakings concerned restrictions which are not indispensable to the attainment of the objectives listed in subparagraphs (a) and (b).
Further, the Competition Board may provide for group exemptions for certain types of agreements from the application of Article 4 of the Competition Act by virtue of communiqués. In this respect, the communiqués for group exemptions published so far by the Board are as follows:
- Block Exemption Communiqué for Vertical Agreements (no.2002/2), as amended by the Communiqués No. 2003/3 and 2007/2
- Block Exemption Communiqué for Vertical Agreements Concerning in the Motor Vehicles Sector (No. 2017/3)
- Block Exemption Communiqué on Research and Development Agreements (No. 2016/5)
- Block Exemption Communiqué on Specialisation Agreements (No. 2013/3)
- Block Exemption Communiqué in Relation to the Insurance Sector (No. 2008/3)
- Block Exemption Communiqué on Technology Transfer Agreements (No. 2008/2)
10. Do anti-competitive agreements and decisions need to be notified to the Competition Board?
There is no requirement for anti-competitive agreements to be notified to the Competition Board.
Anti-competitive agreements and decisions which fall within the scope of one of the block exemption communiqués published by the Competition Board benefit from the block exemption without notification, leaving no need for a notification to the Board.
As regards agreements and decisions that fall outside the scope of the block exemption communiqués, the undertaking or association of undertakings concerned should make a self-assessment on whether or not the agreement(s) concerned satisfies the cumulative conditions for an individual exemption, taking into account the block exemption communiqués, the guidelines issued by the Competition Board and previous decisions of the Competition Board. In other words, there is no requirement for notification for these agreements either. However, for the purposes of legal certainty, undertakings and associations of undertakings may apply to the Competition Board for an individual exemption.
Published on 01 August 2017
1. What is the regulatory status of Pharmaceuticals in Turkey?
Pharmaceuticals cannot be offered for sale without obtaining marketing authorization in Turkey. The Turkish Medicines and Medical Devices Agency, established under the Ministry of Health, is the competent authority to grant marketing authorization. Along with the obligation of obtaining a marketing authorization to supply pharmaceuticals to the market, there is also the obligation to apply to the Turkish Medicines and Medical Devices Agency, and obtain a price. A reference price regime is implemented in Turkey with regard to pharmaceutical pricing. Pharmaceuticals can be offered for sale only in pharmacies, there is no OTC system in Turkey and it is forbidden to promote pharmaceuticals to the general public.
2. Can pharmaceuticals be subject to parallel import in Turkey?
Pharmaceuticals can only be imported to Turkey by the marketing authorization holders and the customs clearance certificate is issued in the name of the marketing authorization holders. Therefore, pharmaceuticals cannot be subject to parallel import and no other person other than the customs clearance certificate owner can clear the pharmaceuticals from customs.
3. Is there a pharmacovigilance system in Turkey?
Yes there is. The pharmacovigilance related activities are conducted by the Turkish Pharmacovigilance Center (TUFAM) in line with the “Regulation on the Safety of Medicinal Products” and “Guideline on the Good Pharmacovigilance Practices”, “Pharmacovigilance Guideline”, “Guideline on the Conduct of Pharmacovigilance Audits” and “Guideline on the Reporting of Pharmacovigilance Audits”. Information about TUFAM can be obtained from: http://www.titck.gov.tr/Ilac/Farmakovijilans
4. Are clinical trials allowed in Turkey?
In Turkey, clinical trials are regulated by the Turkish Medicines and Medical Devices Agency. The legal texts regulating clinical trials in Turkey were first issued by the Ministry of Health in 1993, and today clinical trials are regulated by the Regulation on Clinical Trials on Medicines and Biological Products dated April 2, 2015. Guideline for Good Clinical Practices, which is the basis for the “Regulation on Clinical Trials of Drugs and Biological Products” (hereinafter cited as “Clinical Trials Legislation”) has undergone numerous changes (with the aim of harmonization with EU Directives) over the past years.
5. Can pharmaceutical wastes be imported to Turkey or exported from Turkey?
As per the Environment Code, wastes cannot be imported to Turkey. It is necessary and also important to examine all legislation related to dangerous wastes in order to make a full assessment in this regard.
6. How are medical devices regulated in Turkey?
The Turkish Medicines and Medical Devices Agency is the competent authority for the supply and supervision of medical devices to the market in Turkey and it is regulated by Regulation on Medical Devices, Regulation on Active Medical Devices that can be Placed on the Body, Regulation on Clinical Research of Medical Devices, Regulation on Testing, Control and Calibration of Medical Devices and Regulation on Sales, Advertisement and Promotion of Medical Devices. While the relevant legislation is in harmony with the majority of EU Directives, it also includes stricter rules for market supply, advertising and promotion to healthcare professionals.
7. How are cosmetics regulated?
The Ministry of Health is the competent authority for cosmetics. Cosmetics are not subject to any permission or marketing authorization but a notification system is adopted. The notification is made through the internet in line with the related Regulations and Guidelines of the Ministry. Self-control system is adopted for cosmetics, the cosmetic manufacturer is responsible for the security of the product and the accuracy of the notifications made to the Ministry. However the Ministry of Health can always conduct audits.
8. Are there any specific regulations with regards to the importation and presentation of foods in the market?
In Turkey, the specific regulations on food importation and its supply to the market are set out by the Code numbered 5996 and the related regulations. Also, the responsibilities of producers and importers during the period between the importation of foods and their supply to the market have been regulated in relevant legislation comprehensively. In addition to these, there are several regulations regarding labeling and packaging of foods.
9. How are the advertisements of foods and cosmetics regulated?
The general principles of advertising are regulated by Consumer Protection Law and the Regulation on Commercial Advertising and Unfair Commercial Practices. According to such regulations, the claims in the advertisements should be true and should not be misleading. Besides, the claims in the advertisements should not cause unfair competition in the market. Since labels and packaging materials are also deemed as advertising materials, such materials also need to be in accordance with these regulations.
It is important that the information with regards to the ingredients of the foods in advertisements should be true and should not be misleading for the consumers. Regarding the cosmetic advertisements, there should not be any claims within the ad indicating the cosmetic product can diagnose and/or cure a certain disease.
10. Are there any specific regulations protecting the consumer rights and setting out product liability in Turkey?
In Turkey, consumer rights are protected by Consumer Protection Law as well as the regulations issued based on this Law.
The product liability and its legal effects have been set forth in the Consumer Protection Law numbered 6502 and the Regulation on the Liability Arising from the Damages Due to the Defected Good. The “product liability” should be understood as the liability for the damages arising from defected goods/services (such as death, injury or the other damages in respect of the other goods/services used/benefited). According to the general principle of the Code of Obligations, excluding relevant exceptions, the burden of proof is on the consumer for any compensation claims and the consumer is obliged to prove the loss suffered because of the defective goods/services.
Published on 01 August 2015
1. What are the main legal controls on advertising and marketing in your jurisdiction?
In Turkey, the central piece of legislation on advertising law compliance issues is the Turkish Consumer Protection Law numbered 6502 (“CPL”) and the Regulation on Commercial Advertisements and Unfair Commercial Practices (the “Advertising Regulation”) prepared in line with the CPL which was published in the Official Gazette dated 10.01.2015 numbered 29232 and entered into force on the same date.
The Advertising Regulation covers any kind of commercial advertisements, is inclusive of both the principles of advertising and the circumstances of unfair commercial practices.
2.What are the main rules and principles applying to advertising?
- Be clear
- Be in conformity with public moral norms.
- Be honest and truthful (burden of proof is on the Advertiser)
- Be easily and clearly understandable by average consumer. .
- Respect to human dignity and human rights.
- Respect to personal life
- not incite or induce violence, or encourage unlawful or prohibited behavior,
- Not contain elements dangerous for human life / disregard safety
- not contain any discriminatory element with respect to sex, religion etc
- not be in a form which will abuse the consumers’ confidence or take advantage of their lack of experience and knowledge
Advertisements are required
- to be accurate and honest.
- to be in compliance with the principles of fair competition which have gained acceptance in both business life and in public opinion within the framework of the sense of economical and social responsibility.
- To be created in consideration of the average consumer’s perception level and potential effects of the concerned advertisement on the intended consumers.
3. How the claims in advertisements should be proven, are there any specifications required by the law?
Advertisers are liable for proving the claims asserted in the advertisements.
The descriptions, allegations or analogous expressions given in advertisements in relation to verifiable facts must be proven by scientific reports. If needed it could be demanded to submit reports to be issued by the related departments of universities, relevant accredited testing and evaluation organizations or independent research organizations.
The claims in the comparative advertisement must be proven by independent scientific reports to be issued by the related departments of universities, relevant accredited testing and evaluation organizations or independent research organizations.
4. Are there specific products for which advertising is more closely regulated in Turkey?
There is a total ban on advertising for pharmaceuticals, tobacco, alcoholic beverages and fortunetelling-astrology-mediumship. In addition, the following products/sectors have stricter advertising rules: medical devices, healthcare services, food, supplements, cosmetics and cleaning products, financial services, time share vacation services, real estate, advertising relating to the environment, products intended for children, gambling and games of chance.
5. Is Comparative advertising permitted under Turkish law?
Comparative advertising is permitted by the Regulation on Commercial Advertisements and Unfair Commercial Practices under some strict rules for preventing misleading and defamatory advertising, unfair competition against and before the consumers as well as other competitors in the market.
Comparative advertisements shall be allowed only if: a) They are not of a delusive or misleading nature, b) They do not give rise to unfair competition, c) The compared goods or services are of the same nature, and they meet the same requests and needs, ç) An aspect providing benefits to the consumers is compared, d) The relevant goods or services objectively compare one or more tangible, essential, verifiable and characteristic features, including the price of the compared goods or services, e) Objective and measurable arguments based on numeric data can be proved by tests, reports or such other documents, f) Such advertisements do not disparage, defame or disgrace a rival’s intellectual and industrial property rights, trade name, company name, other distinctive marks, goods, services, activities or other properties, g) The goods or services are procured from the same geographical region in cases where the goods or services are of a known origin, ğ) Such advertisements do not give rise to confusion between the advertiser and a rival of the advertiser, the said rival’s trademarks, trade name, company name, other distinctive marks, goods or services.
According to Article 8/2 of the new Regulation competitors’ name, trademark, logo or other distinctive signs and expressions as well as business name are permitted to be mentioned in comparative advertising provided that they are not in conflict with the regulation’s other relevant provisions. However effective date of this specific provision is delayed, determined to enter into force as from January 1, 2018.
6. What are the legal sanctions for non compliance with the advertising rules?
The penalties, for non-compliance with the Regulation, are set out in the Consumer Protection Law. Namely, upon complaint of third parties or an ex-officio examination, the Advertisement Board is entitled to temporarily or permanently cease the advertisement, request correction of the advertisement as well as to impose administrative monetary fine corresponding to TL 12.070 –approximately EUR 3,000- if the advertisement is broadcasted via a regional TV channel; TL 241,413 –approximately EUR 60,000- if the advertisement is broadcasted via a national TV channel; TL 6,034 –approximately EUR 1,500- if the advertisement is broadcasted via a regional radio channel; TL 60,353 –approximately EUR 15,000- if the advertisement is broadcasted via a national radio channel; TL 60,353 –approximately EUR 15,000- if the advertisement is broadcasted on internet; TL 30,176 –approximately EUR 7,000- if the advertisement is broadcasted via SMS; TL 6,034 –approximately EUR 1,500- if the advertisement is broadcasted in other media than internet, radio, TV , SMS and periodicals.
Where the same infringement is repeated within the period of year, the Advertisement Board is entitled to impose the above mentioned administrative monetary fines up to ten times.
7. Are prize giveaways and similar promotions regulated in Turkey?
The Regulation on Lotteries and Drawings for Non-Cash Rewards No. 26309 (the “Regulation”) published on the Official Gazette numbered 26309 and dated 04.10.2006 defines the “contest” as “the organizations of which the winners are determined among the participants depending on the knowledge and skill qualifications of the participants and by the elimination method considering the success degrees or by the assessment of a jury determined within the same principles and at the end of which an in-kind and/or cash prize is given, and also the puzzles, riddles, entertainment programs and such others.”
8. Are chance-based games (i.e., random draw promotions, instant win games) are permissible in Turkey?
Yes, chance-based games are generally permissible. However, they are strictly regulated by the National Lottery Administration (“NLA”).
As a general rule, Article 41 of the Decree Law No. 320 provides that chance-based games where cash is given as a prize can only be conducted by the NLA itself. Lotteries where the prize is not in cash can be conducted by real or legal persons, such as commercial enterprises, sport clubs and media organizations.
The conditions for staging chance-based games where the prize is not in cash are comprehensively laid down in the Regulation.
9. Are skill-based contests (i.e., essay contests, photo contests, user-generated content contests) generally permissible?
Yes, skill-based contests are generally permissible.
The Regulation defines a “contest” as “an arrangement in which the winners are determined from amongst the participants depending on the knowledge and skill of the participants and by a method of elimination that takes into account their degree of success, or by the assessment of a jury according to the same principles, and at the end of which an in-kind and/or cash prize is given; and also puzzles, riddles, entertainment programs and similar arrangements.”
Lastly, the Official Rules of skill-based contests must comply with the Turkish Consumer Protection Law No. 6502 (“Turkish Consumer Law”). In particular, the Official Rules must be clear and understandable by Turkish participants and not contain any misleading elements.
10. Is a license/permit/approval required If so, which government authority is responsible?
The mechanism of the promotion (contest/draw) plays a significant role for determination of whether any permission is needed from the relevant governmental authority.
For prize competitions/contests, there is no need for a registration or to get permission before the NLA which is the sole authority to organize lotteries and draws with a cash reward and to permit for the lotteries and draws with a non-cash reward.
If the winners of the promised prizes are determined by a draw depending on the chance factor, the promotion will be deemed as a draw under the Regulation and it will be subject to the permission of the National Lottery Administration. By way of exception, there is no need to obtain official permission if the monetary value of the non-cash prize per individual is less than TRL 81,36. (Approximately 20 Euros). This figure is amended at the beginning of each calendar year. If the monetary value of the non-cash prize exceeds this amount in a prize draw then the organization of such promotion will be subject to the official permission of the NLA.
If official permission is required for a prize draw the organizer shall apply before the NLA at latest 15 days before the beginning date of the promotion with the required documents and information i.e. an application petition, the name, surname, title domicile, work address, trade registry no, tax no, or identity no of the promoter, beginning and ending dates of the promotion and the geographical determination for which the promotion will be run, terms and conditions for participation, the number, quality, total and per unit value of the prize, the date, time, address and form of the draw as well as the number of substitute winners to be determined, the date and form of the winner announcement, the document indicating that the bonding requirement is met and some other official documents as may be required by the NLA.
Upon completion of the required application documents the NLA reviews the application and should decide on grant of permission or non-grant of the same within 5 business days at latest.
11. Is it possible to require purchase in order to obtain entry, or is a no purchase necessary route required?
If the winners of the promotion are determined by a jury or according to a scoring method without any draw mechanism, such promotion can be regarded as a contest under the Regulation. As per Article 2/ç of the Regulation, “The contests in which a certain amount is not charged from the participants and which do not serve for the purpose of the promotion or sale of a certain good or service” fall outside the scope of the Regulation. In line with this provision, the contests cannot serve for the purpose of the promotion or sale of a certain good or service and each person shall have an equal opportunity to participate in order to be regarded as a contest and to fall outside the scope of the NLA authority. Hence, the prize contests cannot be organized with a pre-condition of payment or purchases in any case. On the other hand, if the mechanism will be a prize draw, such a pre-condition is allowed.
12. Are there any instances in which a bond or other form of security will be required? If so, please provide details.
In prize draws, the organizer shall deposit a certain amount of bond which corresponds to 10 % more of the total market value of the committed prize/prizes to the NLA. If the period between the commencement date of the promotion and the last delivery dates of the prizes exceed 6 months, then the amount of the bond can be determined as up to 50 % more of the total market value of the committed prize/prizes. The deposited amounts are returned to the organizer after all the prizes are duly delivered to the winners at the end of the promotion period provided that there are no complaints raised against the promotion.
There is no bond requirement for the prize competitions/contests.
13. Is there a requirement that the promoter has an entity (physical presence, agency or other business associate) in Turkey associated with or conducting the promotion?
Concerning the prize competition/contest, as there is no application obligation before the NLA, the organizer does not need to have an entity in Turkey. However, it is important that the participants should find and reach the organizer whenever it is necessary in relation to the contest under the principles of consumer protection. If the organizer is reachable from the outside of the country as well, then there will be no problem.
Concerning the prize draws, the promoter does not need to have a legal entity in Turkey as a legal requirement; however in practice, the NLA seeks for an entity to be addressed in Turkey for this promotion and usually the foreign promoters work with a local agency or another business associate in Turkey for the ease of the application and conduction procedures before the NLA. In such a case, the local agency or the business partner is authorized as the authorized representatives of the promoter and usually a power of attorney with a signature circular or a signature statement of the promoter is required by the NLA for the application.
Published on 01 August 2017
1. Is there an obligation to use a patent granted or validated in Turkey and if yes, what are the consequences of not using it?
Article 130/1 of Industrial Property Law numbered 6769 (“IPL”) reads as follows:
“The patentee or the person authorized by him is under obligation to put to use, the invention under patent protection. Market conditions and the conditions out of the control and will of the patentee are (to be) taken into consideration when/for assessing the use.”
As a practical note; the proof of use can be in a form of import certificate such as a custom declaration approved by the Turkish Customs indicating that those products have been imported to Turkey. In case of non-use of the patent, this does not directly result in the loss of any rights. However, pursuant article 129 of IPL, the patent may become open to compulsory license requests from 3rd parties. In this case, a compulsory licensing request must be addressed to a court and the patent owner can always prove to the Court that the patent is being used in Turkey.
2. If employees’ inventions are entitled to remuneration from their employer in Turkey, does the duty of remuneration remains if the inventor has left the company?
According to Article 113 of the IPL, service inventions are those inventions which are made by the employee during the term of his employment, while performing, as of his obligation, the task he has been assigned to or which are based to a great extent on the experience and activity of the company. Employee’s inventions which do not fall under the scope of service inventions are deemed to be free inventions.
An employer may claim a right, in part or in whole, for a service invention. The employer must notify the employee of his claim, in writing. Where the employer claims ownership in whole on the service invention, with the notification of the claim in writing to the employee, all rights on the service invention pass to the employer and the employee qualifies for a reasonable compensation as against the employer. This right to ask for compensation will continue after the employee has left the company.
3. Preliminary injunctions – what are the criteria for grant? What is the appeal process of any preliminary injunction?
According to Article 159 of the IPL, the persons who are entitled to file an action under the IPL may request from the court to adopt a preliminary injunction decision to ensure the effectiveness of the award, provided that the subject matter use is in the way of infringement of its own industrial property rights in the country or proves that serious and effective work has been done to achieve it. Moreover, according to Article 389 of the Civil Procedural Code, each of the parties to proceedings can apply to the Court during ongoing proceedings or before such proceedings has been commenced for a preliminary injunction order to be granted. The preliminary injunction requests are accepted when any delay might cause irreparable and significant damage. If the patent owner applies to the IP Court for the determination of evidence, the provisions of the IPL, which compared to the Civil Procedural Code provisions have priority in application, will be applicable. The success in a preliminary injunction request is totally dependent on the quality of evidence.
The party against whom a preliminary injunction is granted can oppose to the preliminary injunction order.
4. Which regulatory provisions exist with regard to data exclusivity for data submitted with an application for a marketing authorization for a medicinal product?
Article 9/3 of the Regulation on the Licensing of Medicinal Products for Human Use provides for data exclusivity for data submitted with an application for a marketing authorization for a medicinal product. It provides that:
The data exclusivity period shall apply on the original products for which no generic registration application has been submitted in Turkey until 01/01/2005, among the original products registered for the first time after 01/01/2001 in one of the countries within the Customs Union Area and the original products that will be registered for the time after 01/01/2005 in one of the countries within the Customs Union Area and shall be valid for 6 (six) years starting from the first registration date in the Customs Union Area, limited with the term of the Turkish patent relevant to the molecule.
5. Which regulatory provisions exist with regard to market exclusivity following the approval of a medicinal product?
The only provisions providing market exclusivity are patent protection and data exclusivity protection. There is no SPC (Supplementary Protection Certificate) or market exclusivity for the first generic product in Turkey.
6. Is there a procedure which an IP right holder can obtain information regarding the generic marketing authorization (license) applications abridged to its original medicinal product?
Yes. In its decision dated 6.3.2007, the 10th Chamber of the State Council makes an explanation as follows:
“In the realization of the state of law principle, one of the most important and effective means of carrying out the activities of the administration in accordance with the objective principles and in a reliable system is the “principle of transparency of the administration” and the most important of the rights that complement this principle is the right and freedom of information. The right to information allows the interested parties to participate in decision-making processes, to operate the control mechanisms effectively and to exercise the freedom of right seeking effectively. It is possible that some restrictions can be placed on the right to information to protect commercial enterprises, to prevent unfair competition and to ensure full operation of the free market economy. However, the confidentiality of the stated purpose is limited to the confidentiality of the “commercial secret” information that contains the scientific data and the economic and financial status and marketing techniques of the commercial enterprises. According to the provisions of the Convention cited above, it is possible for the inventors of the invention to control the inventors by means of the fact that the data presented to the original drug registration file are effectively protected by the administration against unfair competition by having information from the abbreviated marketing authorization applications which have been made by reference to the marketing authorizations they have. It is clear that the rejections of applications for the purpose of obtaining information made by inventors of the invention by setting forth the confidentiality rule will constitute the restriction of the effective use of the freedom of right of claim.”
On the grounds of the explanation above, the Chamber of State Council has cancelled the decision of the MOH rejecting the information request of legal representatives of an innovator company regarding the abridged applications made in reference to the innovator company’s licensed product. After this judgment, the MOH responds to the official requests of the legal representatives of the IP right holders and provides information regarding whether such abridged applications exist or not, if exists, the number, the date and the name of the applicants.
Published on 01 August 2017
1. What are the conditions for registering a trademark?
Under Articles 4 and 5 of the Industrial Property Code (hereafter “IPC”)No. 6769, any sign
i. capable of distinguishing the goods and services of an undertaking from the goods and services of another
ii. can be displayed in the registry in a way that can provide a clear and precise understanding of the issue of the protection provided to the trademark owner
iii. such as words including personal names, designs, letters, numerals, the shape or packaging of the goods
can be registered as a trademark.
2. Does trademark protection unconditionally depend on a registration obtained?
No. Pursuant to Article 6/4 of the IPC, well known trademarks within the meaning of Article 6 bis 1 of the Paris Convention are protected from similar subsequent national applications/registrations without respect to a national trademark registration. Furthermore, pursuant to Article 6/3 of the IPC, earlier and genuine rights on an unregistered trademark are also protected from similar subsequent national applications/registrations.
3. Can three dimensional (3D) signs i.e, product shape and packaging, be registered as trademarks with Turkish Patent and Trademark Office (“the Office”)?
Similar to those signs that can be represented graphically, 3D signs that include the shape or packaging of the goods can be registered as trademarks provided that they satisfy the distinctiveness requirements outlined in Article 5 of the IPC meaning that the 3D sign must be capable of distinguishing the goods and services of one undertaking from the goods and services of another.
4. Is there a use requirement before/after applying for a trademark registration?
It is not required that the trademark be in use during the period of application or registration. However, pursuant to Article 9 of the IPC, if the trademark has not been put into use for a continuous period of 5 years upon its registration without a justifiable reason, in respect of the goods and services to be registered; or has been put into a five year uninterrupted non-usage, an action can be filed before the court for revocation on grounds of non-use.
5. Are coexistence of trademarks and/or coexistence agreements and letters of consent accepted under Turkish law?
Pursuant to Article 5/4 of the IPC, trademarks that have been registered for the identical or the same type of goods or services or trademarks that are identical or similar in a way that cannot be distinguished with the trademarks that have been registered on a previous date; could be registered in case of submission of the notarized document showing that the previously registered trademark owner has expressly consented to the registration of the application to the Office.
6. Could the revocation of a trademark on the grounds of non-use be argued before the Office during the administrative stage?
Pursuant to the Article 26 of the IPC, revocation of a trademark on the grounds of non-use could be argued before the Office. However this provision will enter into force seven years after the date of its publication, in other words on January 10, 2024. Until this time, revocation of trademarks for non-use can be argued only before the courts by filing a lawsuit.
7. What are the administrative and judicial procedures for registering a trademark?
Initially, the trademark application is subject to an ex officio examination on absolute refusal grounds by the Office. Upon the ex officio examination, the goods/services rejected is deleted from the scope of the application and the application is published in the Official Trademarks Bulletin for the goods/services accepted, pending for third party oppositions for a period of two months upon which the application is officially registered. It is possible to appeal the Office’s Trademarks Directorate decisions rendered on the ex officio examination as well as any opposition filed before the Re-examination and Evaluation Board of the Office (“REEB”). The decision of theREEB can further be appealed to the IP Courts of Ankara, that being the court with exclusive jurisdiction. The IP Court’s decision can be challenged before the District Courts of Appeal. The decisions of the District Courts of Appeal can be challenged before the Supreme Court of Appeal.
8. What are the conditions for registering a design?
Under Article 56 of the IPC, a design must be novel and of an individual character in order to be registered as a design.
9. What are the administrative and judicial procedures for registering a design?
A design application is subject to ex officio examination pursuant to Article 64/2 of the IPC. The refusal decision given from the ex officio examination can be challenged within two months before the REEB. The designs which are not rejected upon the ex officio examination are published directly in the Official Designs Bulletin. A third party may file an opposition against the published design within a period of three months. The appeals are examined by the REEB. The decision of the REEB can be further appealed before the Civil IP Courts of Ankara, that being the court with exclusive jurisdiction. The IP Court’s decision can be challenged before the District Courts of Appeal. The decisions of the District Courts of Appeal can be challenged before the Supreme Court of Appeal.
10. If a conflict arises about a trademark and design registrations that cannot be solved in the administrative stage before the Office and is referred to the IP Court, are the parties bound by the evidences submitted to the Office during the IP Court proceedings?
Even though there is no provision worded to as to be explicitly applicable to this matter, recent Court of Appeal precedents require the parties to be bound by the evidences submitted to the Office during the IP Court proceedings as well.
11.Is it required to submit power of attorney (PoA) for the filings, i.e, oppositions and appeals, before the Office? Is it required to submit PoA for the Court proceedings and what are the formal requirements for the PoAs?
Pursuant to the IPC, it is not required to submit PoA for the oppositions and appeals, before the Office. But the Office may anytime demand such PoA to see if the trademark attorney is indeed authorized to file such an opposition.
In case of Court proceedings, it is necessary to submit PoA and the PoA must be notarized. The PoA provided by foreign entities must also be apostilled according to the Hague Convention. Instead of an apostille should that be unavailable, an approval by the nearest Turkish Consulate would also suffice.
12. What is considered literary and artistic work and how is it protected?
In order to be considered a literary and artistic work, the work in question must
- fall under one of the definitions for literary and artistic works, set forth under Articles 2-5 of the Law on Literary and Artistic Works numbered 5846, listed therein as works of science and literature, music, fine arts and cinema,
- contain characteristics uniquely imparted by its owner.
Literary and artistic works are protected upon their creation, regardless of whether or not a registration has been obtained.
13. Which are the fundamental international treaties applicable to trademarks, designs and literary and artistic works?
The most commonly applied international treaties are the Paris Convention for the Protection of Industrial Property (“Paris Convention”), Annex 1C of the Marrakesh Agreement Establishing the World Trade Organization, Agreement on Trade-Related Aspects of Intellectual Property Rights, (TRIPS Agreement), Convention Establishing the World Intellectual Property Organization, Berne Convention for the Protection of Literary and Artistic Works, Hague Agreement Concerning the International Registration of Industrial Designs.
14. Is cumulative protection for trademarks, designs and literary and artistic works possible?
Provided that the required conditions are satisfied for each intellectual property right, yes. Accordingly, a sign can be registered and protected as a trademark, a design and a literary and artistic work.
15. Which are the competent Courts in intellectual property disputes?
In Turkey’s three largest cities, Ankara, İstanbul and İzmir, specialized Civil and Criminal IP Courts handle IP matters. In other cities the Civil, Commercial and Criminal Courts of First Instance are the competent courts.
Published on 01 September 2017
1. Is the Turkish legal infrastructure sufficient for anti-counterfeiting?
Yes. Turkey has signed almost all international intellectual property agreements -including TRIPS signed by and between the members of the World Trade Organization which aim to harmonize its legal infrastructure targeting anti-counterfeiting and fighting the illicit trade- and has been acting in compliance with the said agreements.
As of today; the Industrial Property Law No. 6769, the Law No. 5846 on Intellectual and Artistic Works which are in force in Turkey, offers the same level of protection with the relevant laws of the developed foreign countries.
2. Which regulations and innovations on anti-counterfeiting were introduced by the new Industrial Property Law which entered into force at the beginning of 2017?
The Industrial Property Law regulates that those who produce, market or sell goods or services through infringement of a third party’s trademark rights, distributes such goods or services or otherwise releases them into the market, or import or export, keep the same in their possession for commercial purposes shall be convicted to imprisonment from one to three years, and shall be imposed punitive fine up to twenty thousand days.
The “fast destruction procedure” which foresees quicker destruction of the counterfeit products is regulated under the new Industrial Property Law. The new procedure introduced entitles the Public Prosecutor – or the judge if the matter matures into a full criminal case – to order the destruction of the rest of the goods that lay with the trustee where the goods are at risk of damage or serious loss of value, or if the storage of the goods is very costly, provided that the counterfeit nature of these goods is confirmed by an expert report.
3. What are the methods available for use in anti-counterfeiting activities at the Turkish Customs offices?
In Turkey, the customs legislation on protection of intellectual property rights is very effective. Right owners or their representatives are entitled to protect their intellectual rights through an online application to be filed before the General Directorate of Customs for suspension of counterfeit products at the customs directorates. The said protection shall be granted for a period of maximum one year taking validity period of the relevant intellectual property right into consideration. The granted right may be renewed at the customs.
Thanks to these applications which are deemed valid before all customs offices in Turkey, customs directorates issue a 10-business day temporary suspension against counterfeiting activities and directly notify the right holders or their representatives upon identifying a possibly counterfeit product. Upon such notification, the right holders and/or their representatives may examine the relevant products, resort to the legal remedies granted to them by the laws if the products are confirmed to be actually counterfeit and may prevent release of the goods out of the Customs Territory.
Article 57/6 of the Customs Law introduces a “Simplified Procedure” for destruction of counterfeit goods. According to this procedure; should the parties come to a mutual agreement, counterfeit products may be destroyed by the Customs Offices without the need for any further court decision.
4. How do the authorities fight against the counterfeit products confiscated within the scope of anti-smuggling activities?
Applications filed before the Directorate General of Customs also lay a burden on the Liquidation Offices which sell the products being subject to the crime of smuggling. In this context; in presence of any doubt that the confiscated products are counterfeit, the Liquidation Offices are expected to stop sales of the relevant products and notify the right owners or their representative thereof. Within the given framework, sales of the suspected products shall be ceased for a period of 10 business days for the right owner to make necessary examinations and to obtain a writ from the Prosecution Office or a court order announcing that legal action has been taken.
5. What are the advantages offered by criminal actions within the scope of anti-counterfeiting activities?
The basic advantage offered by criminal actions is that confiscation decisions can be quickly made upon the trademark right holder’s complaint and following the referred procedure, public prosecutors and judges ex officio conduct the related investigations and legal proceedings. Struggle against counterfeiting activities through criminal actions produce results within a shorter period and at a lower cost as compared to civil actions.
Besides, the criminal provisions about intellectual property crimes of the Industrial Property Law regulate that should sellers reveal source of the counterfeit goods, namely manufacturers of the counterfeit products, and enable authorities to seize the goods at source; no penalty shall be imposed on them. Thereby, it has become possible to reach the counterfeit manufacturers/importers by way of taking actions against sellers.
6. What are the procedures to be adopted against a store which is found out to be selling counterfeit products?
Upon identifying a store which is assumed to sell counterfeit products, a complaint petition shall be presented to the competent Public Prosecution Office along with the evidences which arouse reasonable suspicion required for a search and seizure warrant. After the competent Court issues a search and seizure warrant upon the relevant Public Prosecution Office’s request, a writ of execution shall be issued for further action to be taken by the law-enforcement officers and police officers conduct search and seizure activities at the address given in the Court’s warrant mostly within the same day.
7. What are the penalties imposed on the defendants who are found out to be selling counterfeit products?
According to the Industrial Property Law; those who are found out to be selling counterfeit products shall be convicted to imprisonment from one to three years, and shall be imposed punitive fine up to TRY 2 million following the legal proceedings. For crimes related to copyrights, defendants may be convicted to imprisonment from two to four years.
Article 231 of the Criminal Procedure Code foresees that for the convicts who have not intentionally committed a crime and whose punishment is less than two years, announcement of the verdict shall be postponed. According to the referred regulation, the accused party’s punishment shall be postponed for five years. In cases where the accused has committed a new intentional crime during the given period, the court shall pronounce the judgment. In cases where there has been no intentional crime committed during the period of probation, the judgment shall be annulled and the judgment shall not have any legal effect for the accused. This provision may be applied if the judge comes to the conclusion by taking the accused person’s attitudes and behaviors at the hearing that he shall not commit another crime.
Additionally, confiscation/destruction of the infringing counterfeit products shall be decided at the end of the criminal proceedings.
8. What are the measures to be taken against unauthorized online sales?
Considering that the counterfeit sellers can now access consumers more easily, they conduct sales activities via online platforms. Commitment of criminal activities over the Internet makes it difficult for the authorities to monitor suspects and to generally conduct investigations.
In addition to this, if a crime is committed over the Internet; results can be produced by following the standard methods adopted for the criminal proceedings. Therefore, it is of utmost importance to carry out investigations about the owners of such websites or suspected product lines.
9. Is it necessary to work with both advocates and investigators within the scope of the anti-counterfeiting activities?
Yes. In the field of anti-counterfeiting activities, if those who plan to take legal actions in Turkey work with the advocates and investigators being experts in the field of intellectual property cases; better results will be produced. Working with foreign investigators can be useful for cross-border cases.
10. What is the most efficient institution in Turkey in the field of anti-counterfeiting?
Turkish Police Service has a very efficient department which consists of officers being experts in the field of intellectual property rights. Regular contact and coordination with the relevant police departments are the most important factors to achieve success in anti-counterfeiting activities to be conducted in Turkey.