The Communiqué on the Decree Law No. 32 on the Protection of the Value of the Turkish Currency numbered 2008-32/34[1] (the “Communiqué No. 32/34”) regulates transactions which are carried out in foreign currency. The Amendment Communiqué has now amended the regime pertaining to the sale of movable assets.  

Amendments

Previously, as per sub-paragraph (9) of Article 8 of the Communiqué No. 32/34, it was possible to determine the contract price and any other payment obligations relating to the sale of moveable assets (save for any sale relating to vehicles which is subject to a separate legal regime) in or indexed to foreign currency.  

Although the Amendment Communiqué preserved the possibility of determining the price and any other payment obligations relating to the sale of movable assets in or indexed to foreign currency, it is now mandatory to effect actual payment and/or accept actual payment in Turkish Lira. Therefore, the respective contract price and any other payment obligation would be required to be converted into Turkish Lira before the payment occurs. This brings about foreign currency risk in case there is a time difference between the execution of the contract and the actual payment pertaining thereto.

A minor amendment has also been made to sub-paragraph (15) of Article 8 of the Communiqué No. 32/34. The provision allowing for the determination of the contract price and other payment obligations of certain contracts (other than those relating to the sale and rental of immovable assets) entered into by affiliates of the Turkish Armed Forces Foundation (the “Foundation”) has now been extended to include actual payment and acceptance, thereby creating an exemption in favour of the Foundation.

Conclusion

The Amendment Communiqué targets a multitude of transactions. The spectrum of “movable assets” is very broad and therefore, moving forward, each transaction pertaining to a sale of a moveable asset should be evaluated with care.