BRIEFING ABOUT CONTRACTS DENOMINATED IN FOREIGN CURRENCY (EXCHANGE)

Decisions for the arrangements regarding the contracts denominated in foreign currency (exchange) were published in the Official Gazette on 13.09.2018 and 06.10.2018. The regulations for long-run car leasing contracts were included in the published decisions.

With the Decree on the Amendments to the Decree No.32 on Protection of the Value of Turkish Currency published in the Official Gazette dated 13.09.2018 and numbered 30534 (Decision Number: 85), the following paragraph has been added to the 4th article of the decision numbered 32.

“g) The agreement/contract price and any other payment obligation arising from the sale and purchase agreements/contracts for movable and immovable assets; lease/rent agreements for any movable and immovable assets, including vehicles and financial leasing; employment; service; and construction agreements, executed by and between persons residing in Turkey, cannot be denominated in foreign currency or be indexed to foreign currency, except in circumstances determined by the Ministry.”

Again, with the same decree, it was enacted that these amendments must be made within 30 days fo9r the agreement/contracts of which amounts have to be converted into Turkish Liras in accordance with the subparagraph “g” of the Article 4 of this Decree and the Provisional 8th Article added into the Decree numbered 32. However, the following provision was included in the regulation made with the Communique (Communique No: 2018-32/51) On the Amendments to the Communique on the Decree No.32 on Protection of the Value of Turkish Currency published in the Official Gazette dated 06.10.2018 and numbered 30557 (Communique No: 2008-32/34)

“(22) Vehicle leasing agreements, including heavy equipment, concluded before the effective date of the Provisional Article 8 of the Decree No. 32 on the Protection of the Value of Turkish Currency is exempted from the provision of the said provisional article.”

As a result of these regulations made, the Long-Run Car Leasing Contracts concluded before the date of 13.09.2018 and the additional contracts and additional protocols arranged within the scope of these agreements and the leasing prices determined as foreign currency (exchange) for the vehicles leased and whose leasing start date is 13.09.2018 and before; and other costs shown in the Agreements and their annexes shall remain in their current form; and no changes shall be made to the agreements and their annexes issued before 13.09.2018 within the scope of these regulations.