A new Regulation on Principles Regarding the Incorporation and Activities of Financial Leasing, Factoring and Finance Companies (“Regulation”) has entered into force as of April 24, 2013.
The Regulation requires authorization from the Banking Regulation and Supervision Agency (“BRSA”) for certain activities of the Financial Leasing, Factoring and Finance Companies (the “Companies”). Those activities are
• Company formation;
• Opening branches within Turkey or abroad;
• Revisions to Articles of Incorporation and raising capital;
• Acquisition or transfer of shares; and
• Merger, split-up and liquidation.
The Regulation introduces various other requirements with regard to the above listed activities.
The Companies are required to apply to BRSA for an operation authorization together with all other necessary documents within six months after being authorized by BRSA to incorporate. The principles under which the above mentioned authorizations shall be granted and the procedures applicable thereto are also regulated under the relevant articles of the Regulation.
Finally, the Regulation sets out various requirements for corporate governance of the Companies mainly regarding the following points:
• Notifications with respect to the board members, general manager and vice general managers;
• Subordinated debt;
• A standard rate calculated as shareholders’ equity divided by total assets;
• Internal control system;
• Risk management;
• Independent audit.