Law of Banking and Finance

No. Spousal consent is not required for a suretyship given by a shareholder or manager of a commercial company in connection with the company. Under the general rule, unless there is a judicial separation order or a legal right to live apart, a married person may become a surety only with their spouse's written consent given before or, at the latest, upon conclusion of the contract; this rule applies to suretyships by family members who are not shareholders or managers. In any event, the suretyship must be in writing, and the surety must handwrite the maximum amount of liability, the date and, for a joint and several suretyship, that capacity; otherwise, the suretyship is invalid.

Yes. The Law on Pledges over Movable Assets in Commercial Transactions allows a pledge over inventory, receivables, machinery and equipment, intellectual and industrial property rights and the commercial enterprise as a whole, without transfer of possession. The pledge agreement is concluded between a credit institution and a merchant, or between merchants, in writing with a secure electronic signature or signed before a notary or registry official, and the pledge is created by registration with the Movable Pledge Registry. For assets subject to mandatory registration in another registry, that registry's rules are reserved; if the debt is not paid, the first-ranking pledgee may ask the enforcement office to transfer ownership of the pledged asset to the pledgee.

If the lessee defaults on lease payments, the lessor grants 30 days to pay and may terminate the agreement if payment is still not made. Where ownership is to pass to the lessee at the end of the term, this period cannot be less than 60 days; the agreement may also be terminated if the lessee fails to pay three installments within one year, or two consecutive installments, and receives a warning notice. Upon termination, the lessee must return the asset; if it is sold, the parties settle the difference between the sale price and the lease installments not yet due plus damages, and in a dispute the asset may be left with the lessor by interim injunction.

Whether a factoring company can seek recourse against the seller depends on whether the factoring agreement is with or without recourse. In factoring with recourse, the seller retains the collection risk and can be pursued if the debtor does not pay; in factoring without recourse, the factoring company assumes the debtor's non-payment risk through a factoring guarantee. If the agreement is silent, the Turkish Code of Obligations applies: in an assignment for consideration, the seller is deemed to guarantee the existence of the receivable and the debtor's solvency at the time of assignment. Since the debtor may also raise defenses of defect, payment or set-off against the factoring company, the agreement should clearly allocate these risks.

Yes. Commercial interest rates are freely set, and according to the Court of Cassation, the caps on contractual and default interest in the Turkish Code of Obligations do not apply to commercial loans. Banks set loan rates freely but within the maximum rates notified to the Central Bank of the Republic of Türkiye. Absent an agreed default rate, the higher of the statutory rate and the Central Bank advance interest rate may be claimed in commercial matters; if the contractual rate is higher, default interest cannot be lower than it. Compound interest is valid only in current accounts and loans that are commercial for both parties, at intervals of at least three months; otherwise, such interest is deemed non-existent.

No. The Turkish Civil Code treats as invalid any contractual provision under which ownership of a pledged movable passes to the creditor if the debt is not paid, and since the rules on possessory pledges also apply to pledges of rights, this prohibition also covers share pledges. For a pledge-secured claim, the lender must, as a rule, initiate enforcement proceedings for the foreclosure of the pledge, have the shares sold and recover the claim from the sale proceeds. The first-ranking creditor's right to ask the enforcement office to transfer ownership is an exception available only for pledges registered with the Movable Pledge Registry under the Law on Pledges over Movable Assets in Commercial Transactions.

Miran Legal represents companies before banks and financial institutions when they obtain loans and advises on drafting and negotiating loan and financing agreements and structuring security arrangements. We provide legal support in carrying out financial leasing and factoring transactions and in the project finance, establishment and operation of banks and financial institutions. We handle disputes arising from loan agreements and borrowings through settlement, litigation or arbitration at national and international level and, where necessary, conduct enforcement proceedings.