between their terms and existing Turkish laws. Following such amendment on the CAL, on April 1, 2013, a Directive on implementation and enforcement of the Irrevocable De-registration and Export Request Auhtorization ("IDERA") was introduced by the Flight Operation Directorate of the Civil Aviation General Directorate of the Ministry of Transportation, Maritime Affairs and Communication ("CAD") which was then published in the CAD's official website. Obviously, the issuance of this directive was quite an important step taken on the implementation of the provisions of the CTC, given the fact that IDERA is the essential tool for the interest holders to exercise their remedies under the CTC. As a result of Turkey's continuous efforts to ensure the full implementation of the CTC/Protocol and eliminate the practical problems that the parties face during this process, a brand new and updated IDERA Directive entered into force on July 7, 2014, the purpose of which was to provide further clarity for the CAD on how to honor the duly issued IDERA forms. Furthermore, a Circular came into effect in Turkey on July 31, 2013, as issued by the Association of Financial Leasing, Factoring and Financing Companies (who is the current competent legal authority for the registration of cross-border financial lease agreements) ("Association") and this Circular regulates the registration methods and principles of cross border financial lease agreements under Turkish Law. While doing so, the Circular provides for a specific provision on implementation of the CTC by stating that the Association will de-register the lease agreements from its records, in the event that the applying party provides a certificate as issued by the CAD stating that in case a lessor attempts to exercise its remedies under the CTC, the Association will not be able to refrain from de-registration of the financial lease agreement from its records. This year, the Omnibus Bill February 6, 2014, clarified on how executed at the execution and bankruptcy offices in Turkey. The Additional Article 2 (Ek Madde 2) as introduced by the Omnibus Bill to the Law on Execution and Bankruptcy from Article 8/1(a) and Article 10/1(a) of the CTC can be raised by the interest holders before the Ankara Execution Offices (Ankara Icra Daireleri) only. Consequently, (i) the creditors can take possession or control of any object charged to the same in the event of a default of the debtor pursuant to Article 8/1 (a) of the Convention and (ii) the Conditional Seller or the Lessor can re-possess or control of any object related to a title reservation agreement or a leasing agreement in the event of default pursuant to Article 10/1(a) of the Convention but in any case through Ankara Execution Offices. Accordingly, the authority for the execution of claims of the interest holders have been assigned to only one particular execution office in Turkey, in Ankara, the capital city of the country, in which the CAD is located as well, for cases when the contract provides that the terms of the CTC/Protocol will apply. Obviously, because the implementation of CTC is quite a unique practice, the Turkish legislator felt the necessity to structure a one-stop agency for a repossession in order to facilitate the process and eliminate most of the arguments made by certain practitioners in the sector that enforcement of CTC terms would not be understood and possibly made by the execution authorities in Turkey. All these major changes in the local laws of Turkey are the results of a substantial progress on recognition/ implementation of the CTC/Protocol in Turkey by other governmental/ quasi-governmental authorities other than the CAD. Achievement to the list of states ("Cape Town List") as defined under the Sector Understanding on Export Credits for Civil Aircraft ("ASU"), which stands for the states qualifying for rates and consequently whose airlines are eligible to enjoy the Cape Town Treaty discount. In order to deserve this, Turkey has made the declarations which it must have made under the CTC/Protocol and did not make the declarations which it should not have made. On the other hand, Turkey's making or not making the necessary declarations under the CTC/ Protocol was not enough for participating in the Cape Town List and enjoying the Cape Town Treaty discounts. Turkey's implementing the terms of the CTC and the Protocol without exception has led Turkey's success to participate in the Cape Town List. Regarding the procedures in this respect: ASU provides for the framework of predictable, consistent and transparent use of officially supported export credits for the sale or lease of aircraft and other aircraft engines and spare parts. Therefore, the terms and conditions for being listed in the Cape Town List are set out under the ASU, together with the procedures to be pursued for participation of a state in the Cape Town List. Because Turkey is included in the Cape Town List of countries as of October 20, 2014, now the airlines in Turkey, desiring to obtain financing for aircraft with the involvement of export credit agencies will enjoy a discounted rate to the applicable fee as required to be charged by the export credit agencies under the terms of the ASU. Turkey's entrance into this Cape Town List is obviously a big success given the fact that only 21 countries have accomplished participation in this list so far. This success will noticeably affect the aviation sector in Turkey in a very positive way, since obtaining finance with the assistance of export agencies is a preferred financing method for the airline companies from all around the world. Furthermore, for the financings to be obtained from the capital markets, Turkey's inclusion on the Cape Town List will have a positive effect in increasing ratings from the rating agencies. dated June 19, 1932 and numbered 2128. |