Selin OZBEK CITTONE
Attorney at Law / Managing Partner, Dual qualified lawyer (Turkey and England & Wales)
24 April 2017
The Law on Pledge of Movable Property in Commercial Transactions (the “New Law”), as well as the related secondary legislation, have come into force on 1 January 2017. Abolishing the Law on Commercial Enterprise Pledge, the New Law introduces a new system and provides for a more flexible and secure means for the pledge of movable property.
Among the novelties introduced by the New Law, the following are noteworthy:
Commercial enterprise pledges established before 1 January 2017 will continue to be subject to the Law on Commercial Enterprise Pledge and thereby the New Law does not apply to previously established pledges. Nevertheless, banks and financial institutions which seek to revisit their loan and security agreements in light of the current financial environment, may choose to renew their securities. By amending any existing movable pledges or commercial enterprise pledges and establishing new movable property pledges under the New Law, it would be possible to benefit from the beneficial terms under the New Law explained above.