• It is the spirit and not the form of law that keeps justice alive.
    Earl Warren


The Ministry of Treasury and Finance (“Ministry”) has recently announced a press release in respect of the Presidential Decree No. 85 regarding the Amendment of Decree No.32 on the Protection of the Value of the Turkish Currency (“Decree No. 32”).


The press release refers to the Presidential Decree No. 85 which makes certain changes to Decree No.32, concerning the agreements to be executed between the residents of Turkey, which has been published in the Official Gazette dated 13.09.2018 and numbered 30534, and entered into force on the same date.


While evaluating the scope of these amendments, the first thing to note is that such amendments only cover the agreements executed between residents of Turkey as defined by Decree No. 32. While determining the scope of the agreements, it is required to consider the agreements which are executed before the entry into force date of the Presidential Decree No. 85 and which are denominated in foreign currency.


It has been determined by the Ministry of Treasury and Finance that some circumstances are deemed appropriate to be exempted from the obligation to transact in Turkish Lira. 


Input costs and liabilities in foreign currency shall primarily be considered by the Ministry. In this context, for instance the agreements that are executed by the residents of Turkey pursuant to Article 17 and 17/A of the Decree No. 32, through which the parties can utilize foreign exchange facilities and thus under an obligation in foreign currency, shall be taken into consideration. These agreements refer to foreign currency loans utilized by Turkish residents. The Ministry shall determine the scope of these agreements taking into consideration the necessity not to disrupt the economic activities. It will also consider opinions of related public institutions and other players before its announcement.

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