Turkish Secured Transactions: Reform and Challenges
This content delves into the journey of secured transactions reform in Turkey, highlighting similarities and differences in Turkish law, especially concerning access to finance via non-possessory security. It discusses the functional approach, essential elements of security agreements, and challenges such as lack of awareness and organizational hurdles in implementing secured transactions effectively.
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Presentation Transcript
UNCITRAL Colloquium on Navigating the New Era of Digital Finance SECURED TRANSACTIONS REFORMS BY STATES AND INTERNATIONAL ORGANIZATIONS T rkiye s T rkiye s Journey of Secured Transactions Reform Journey of Secured Transactions Reform Mehmet M cahit Arvas LLM, PhD marvas legal
SIMILARITIES MSTL Turkish Law Access to finance via non- possessory security Access to finance via non- possessory security Purpose Existing & future (floating) movable property Existing & future movable property and rights Types of Movables Functional Approach Security right definition Security right definition Every transaction except Professional banking transactions, valuable movable assets such as ship, aircraft Every transaction except FOREX, valuable movable assets such as ship, aircraft Scope COMPARISON General description + specific description Description of Asset General description Proceed Proceed and replacement Proceed and replacement Registry & Special Registry & Possession & control Publicity registry Essential Elements of Security Agreement Parties, obligation, description of assets Parties, obligation, debt amount, maximum amount, description of assets, type of currency and registry fee prior tempore, potior jure & Possession & Control Priority prior tempore, potior jure
DIFFIRENCES MSTL Turkish Law Functional Approach Yes No applicable in practice No Security Agreement No need to be approved Need to be approved Creation of Security Signing by debtor Registering Only banks and commercial entities Parties No restriction Registry Notice based Create the right COMPARISON Registry & Special registry & Control Publicity Registry Form of security agreement informal formal Essential elements of security agreement Parties, obligation, description of assets Parties, obligation, debt amount, maximum amount, description of assets, type of currency and registry fee Description of asset General description Specific & general description
CHALLENGES Lack of Awareness Lack of awareness on secured transactions in both public and private sectors Organizational Challenges Difficulty in identifying the relevant Ministry/Organization Lack of co-ordination between Ministries and Organizations Missing a holistic perspective on secured transactions
CHALLENGES Bureaucratic Challenges The bureaucracy is so unfamiliar with the subject that we are left alone The process was carried out entirely on our initiative Academic Challanges There were no articles, analysis, papers even now there are not many Civil Law jurisdiction There have been criticisms that it is not in appropriate with Turkish law
CHALLENGES International Challenges Lack of coordination with relevant international organizations Failure to provide information flow from international organizations
Huge volume of digital assets trade Challenges with identifying nature of VCC and digital assets Limits to categorize them into movable assets Limits to categorize them into rights Challenges of Civil Property Law Third category of asset? VCC and Digital Asset
Mehmet Mcahit Arvas LLM, PhD marvas legal THANK YOU! marvaslegal@gmail.com mmarvas@gmail.com
