New provisions were introduced to the Capital Market Law (“Law“) numbered 6362 by the Law No. 7222 on the Amendment of Certain Laws and the Banking Law published in the Official Gazette dated 25 February 2020 and numbered 31050 (“Amendment Law“),
- Significant Transactions of Corporations and Retirement Right
The transactions deemed as significant have been limited to the basic transactions related to the structure of the corporation, which will lead to the change of investment decisions of investors such as publicly-held corporations being a party to merger and spin off transactions, conversion, creating privilege or changing the scope or subject of the existing privileges.
In the event that the shareholder uses his/her right to retire from publicly-held corporations, at the request of the shareholder, the corporation shall purchase these shares at a fair price, in accordance with the principles to be determined by the Capital Markets Board (“Board“), instead of the average of the weighted average prices formed on exchange within thirty days starting from the date when the related significant transaction has been disclosed to thepublic. The Board may regulate the procedures and principles regarding the proposal to other shareholders or investors before such shares are purchased by the partnership.
- Debt Instrument Holders’ Board
Pursuant to the Amendment Law, the concept of debt instrument holders’ board has been set forth to be composed of the holders of the issuer’s debt instruments in circulation. It is obligatory to determine the principles and conditions for calling the board of debt instrument holders to the meeting and the decision making in the meeting within the prospectus and/or issuance document prepared by the issuer for the issuance of the debt instrument.
A representative may be appointed to represent the debt instrument holders. In cases where the terms and conditions of these debt instruments are changed after a default occurs in the repayment of the debt instruments, all the proceedings initiated due to the default related to the debt instrument will cease as of the date on which the relevant debt instrument’s terms and conditions are deemed to be changed, interim injunction and provisional attachment resolutions will not be applicable and statute of limitation and prescription periods which can be stopped by a proceeding will not continue. After all debts arising from the debt instrument are fulfilled, the proceedings, which have ceased will be dismissed.
- Security Agent
Capital market instruments to be determined by the Board may be secured by the assets deemed appropriate by the Board in order to fulfil the liabilities arising from these instruments on time. Ownership of the security assets is transferred to the security agent or limited real rights are established on these assets in favour of the security agent who has the capacity of an investment institution with general depository authority. The transfer as security of the security asset is recorded in the declarations section of the relevant registry.
The security agent is authorized by a security management agreement to be executed before the issuance with the issuer in writing to protect, maintain andmanage the security assets transferred to the security agent or limited real rights established on these assets in favour of the security agent for securing the liabilities arising from the capital market instruments, apply for legal remedies, and in case a receivable shall be collected through the security as a result of a default or conditions set forth by law or agreement to enforce security on the asset, to distribute the sale proceeds of the security assets among the investors, to return the amount to the obligor in case there is any amount left after the settlement of the investors’ receivables, to return the security assets to the obligor warrantor upon the fulfilment of the debt and to execute all the necessary acts and transactions including the protection of the investors’ benefits.
Security Agent is authorized to conduct all act and transactions before the special registries including but not limited to the registration transactions before the land registry, ship registry, vehicle registry and movable pledge registry, all the transactions and proceedings regarding the registration and recording of a pledge, mortgage or any real right, annotation, encumbrance, right and receivable on its behalf and on the account of investors. The trade name of each security agent approved by the Board, the issuance that the security agent was appointed for and its authorities shall be registered by the issuer before the trade registry located at the registered address of the issuer and shall be announced in the Turkish Trade Registry Gazette.
In case the receivable can be collected from the security,the security agent can sell the security assets and distribute the price among the investors as a result of a default or conditions set forth by law or agreement without being obliged to fulfil any precondition such as making notifications, providing a deadline, obtaining an approval or permissions from a judicial or an administrative authority, enforcement of the security by auction or any other way.
- Project Finance
Project finance is to provide financing via project finance funds in order to carry out the projects such as infrastructure, energy, industry or technologic investments that require long term and high amount of capital. Project finance fund is an asset without a legal personality which is incorporated with monies and/or other assets obtained in return of the securities based on the project, by investment institutions on behalf of security owners based on the project, through the fund’sinternal regulationand in line with the fiduciary ownership principle, in order to manage the portfolio established on the basis of incomes of asset and rights subject to the project finance.
The income and other rights of the project subject to the project finance are assigned to the project finance fund. The fund is deemed to have legal personality limited to all type of registration transactions including registration, amendment, and release and correction requests before the land registry, trade registry and other official registries. Assets and rights whose transfer’s validity is subject to a registration with a land registry or a registry and which are included within the project finance fund portfolio, are registered before the land registry or the relevant registry on behalf of the relevant fund. The transactions to be made before the land registry, trade registry and other official registries on behalf of the fund are executed with the joint signatures of the project finance fund founder and authorized representative of the fund board.
All the procedures and principles regarding the asset and rights subject to project finance, project finance fund founders, incorporation of the fund, conditions of fund’s activities, fund’s management and termination and the issuance of securities based on the project shall be determined by the Board.
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