Turkey- Business Crimes and Punishments

From International Business Wiki

Here is some interesting legislation that international businesses trying to start in Turkey might want to be aware of:

Turkey has been ranked 13th most attractive country in the world in terms of FDI (Foreign Direct Investment) according to Invest in Turkey. You might ask yourself, why is this? Well, Turkey puts forth a simple business legislation system with improvements in international standards with legal reforms consistent with those of the European Union. This allows all investors to enjoy equal treatment. Recent amendments to the existing laws will assist Turkey even further with its present improvements in the investment environment. So with all this excitement you might find yourself wondering what are the risks and what legalities should I be aware of? Well, there just so happens to be a “New Law” that was put into effect June 1st, 2005 that punishes as well as protects businesses operating within Turkey. Here is a layman’s break down of what this “New Law” entails.

Turkish Criminal Law No. 5327, dubbed the “New Law,” is a bit of an innovation to Turkish legislation in that Criminal Liability of legal entities, meaning businesses and/or organizations responsibility to uphold the law, is a basically new concept for Turkey. There are five basic features in this new law that relate to businesses operating in Turkey.

What is being considered the most interesting feature of this law, in regards to businesses, is the applicability of security measures to legal entities, which is a fancy way of saying, making a company take responsibility for its actions and having the company in question serve the consequences of said actions. These security measures apply not only to individuals within the company, but also to the legal entities themselves, and whomsoever committed and/or benefited from the commitment of a crime. A basic form of the three security measures, or consequences, that apply to the establishments within Turkey are, 1) the license of a business issued by a public authority will be voided if said business abuses the rights and privileges that were granted with such license, 2) all items used and/or gained from the commitment of a crime by those whom represent the business in question will be confiscated, 3) all monetary benefits that result from or were used in the commitment of a crime will be seized.

A second feature of the “New Law” is called “intriguing the tender.” If found guilty through detailed proof all persons involved in this crime are subject to imprisonment from five to twelve years. Similarly, if anyone provides false information relevant to the qualifications of the bidders and goods which are the subject of the tender, forcing bidders through whatever actions to withdraw from a tender, stopping or preventing competition through the use of violence or threatening actions and/or words, allowing changes of tender specifications, especially the tender price, or exposing any confidential information valuable to the tender, can all be subject to and found guilty for intriguing the tender.

The third feature of this law introduces a new crime concerning “Misinformation Regarding the Company.” If anyone representing the company decided to misinform the public or the general assembly of any valuable information that would cause damages to the company and/or organization concerned, such act shall be punishable by imprisonment from six months to one year and also subject to a monetary penalty of up to YTL 100,000, about $70,000 US. If the company concerned is part of the stock exchange the penalty is increased from two to five years imprisonment and a monetary penalty of up to YTL 125,000, or about $93,000 US.

As for all that important data that companies rely on to perform the forth feature protects it with a number of provisions dealing directly with the protection of personal data. Through the affect of “Data Privacy of the Companies,” anyone who illegally keeps, records, or gives out any personal or vital data will be subject to imprisonment anywhere from six months to three years. If a government official or anyone uses the data to gain favor or achieve a higher position in a profession the punishment will be increased by half (meaning three months to one and a half years on top of their original penalty). And for those who decide not to delete and/or destroy data within the expiry time period defined in the relevant laws that maintain such data, punishment is imprisonment anywhere from six months to one year.

“Information Technology Crimes” are the fifth feature of this “New Law.” while older laws have provisions for this area the “New Law” specifies more as to what is subject to this law. Included are the following: the crime of illegally accessing systems which automatically process data and utilize such data, and now also anyone who takes and/or uses bank accounts or credit cards of those without the consent of the owners will be imprisoned for three to six years. Also anyone who makes fake credit cards shall be punished by imprisonment from three years to seven years and should anybody use the fake credit cards will be sentenced to four to eight years. If a company and/or organization use such information technology crimes to benefit illegally from then they will be subject to the security measures explained in the first feature of this law.

This “New Law” was put into effect to not only benefit the companies already existing in Turkey but any new business that wish to establish in this wonderful country. It will hopefully not act as a deterrent for new companies but rather can be seen as Turkey’s way of becoming harmonious with European Union laws, which most of us in the western world are familiar with. This new law is a practical and constructive step for Turkey in becoming a great business nation. All the information and more detailed descriptions of this information can be found at “Turkey”