New Turkish Commercial Code

The New Turkish Commercial Code (“New Law”) is a change that will direct the course of commercial life in our country, a real “Regulation for the Future”. As a result of the preparation process, which involved unusual and model discussions and negotiations, featuring social and political views from across the political spectrum, as well as from commercial bodies, NGOs and professional associations, the New Law was prepared with a modern and reformist approach and will enter our lives as of 1 July 2012. The New Law was adopted by the Turkish Parliament on 13 January 2011 and promulgated in the Official Gazette on 14 February 2011.

The New Law offers a very important opportunity and foundation for institutionalisation, increasing competitive power, establishing public confidence and transparency. We should evaluate this opportunity efficiently and adopt the New Law as an important transformation project that will enable Turkish companies to grow properly and look to the future with confidence. As PwC, we believe that the ethical and transparent structures this change will bring will be sustained in Turkish commercial life, and that they signal progress. Accordingly, as we have done for 30 years, we intend to be at the service of the Turkish business world with our high-level and wide-ranging services in order to share the innovations introduced by the New Law with our clients, making sure they are prepared for the new era as implementation approaches.

The New Law actually redefines the rules of commercial life with its modern approach. The law provides regulations for commercial life that will ensure a desired level of transparency, auditability and reliability. Its philosophy is that even though corporate governance is a set of rules introduced for public companies, because it equals investor and sustainable development, it should apply to all enterprises. Preparation of financial statements in accordance with International Financial Reporting Standards (IFRS) and independent auditing in line with International Auditing Standards (IAS) will necessitate adoption of many international standards in matters such as internal controls, internal audit and risk management, all of which are requirements for corporate governance under Turkish standards and which make change obligatory. This approach means a significant process of adaptation and will mean a great deal of preparation for many Turkish companies.

The New Law and the relevant Law on Enactment will enter into force on 1 July 2012 (1 January 2013 for certain articles). Although this means there is over a year left to prepare, when the important changes the law brings are considered, the period until 1 July 2012 should be fully evaluated both by public and other companies to ensure they understand the process ahead and ready themselves accordingly. Therefore, we believe the preparation process should be initiated as soon as possible and the periods granted for transition should be carefully considered to maximise the benefits of this positive change.

As PwC Turkey, since 2007 we have been contributing to workshops on the New Law with the Association of Independent Auditing, Union of Chambers of Certified Public Accountants of Turkey (TÜRMOB) and the Turkish Industry & Business Association (TÜSİAD). We do this with a sense of duty and consider it to be our social responsibility to help fulfil the function of this law, which represents such an important breakthrough for life in our country. We organised seminars during the preparation process to promote understanding of and compliance with the New Law, and we have also arranged events to raise awareness.

Moreover, on 31 January 2011, we organised an open seminar for companies, with the participation of Professor Ünal Tekinalp, chairman of the commission that prepared this modern law. On our website, you can find a comprehensive summary of the seminar at which participants had the chance to learn crucial details of the New Law first hand.

We are continuing our seminars and training programmes on the New Law and its implementation. We are organising these events not just in big cities, but in cities across Anatolia. Our book, “Türk Ticaret Kanunu – Geleceği Hazırlayan Bir Düzenleme” (Turkish Commercial Code – Regulation for the Future), which explains the essence of the law and includes significant changes introduced for commercial companies, reached record levels of distribution when the law was still a draft. We have updated our book to make sure it is compliant with the newest version of the New Law. You can access the book, all relevant publications and their English translations both on our website and on the iPad.

Finally, we have prepared a “roadmap” consisting of four stages in order to be helpful for the planning and implementation of business on time and in an efficient and accurate manner for compliance with the New Law. We believe the roadmap will be useful in adopting the New Law, and with it we provide you access to our knowledge, experience and expertise as we have done for 30 years.

The key to success is to manage change accurately