The Law on Financial Leasing, Factoring and Financing
Companies no 6361 (Law), which entered into force on December
13 2012, regulates the establishment and working principles of
financial leasing, factoring and financing companies.
Under the Law, a factoring company must be established in
compliance with certain conditions. These conditions include:
minimum paid-up capital of TL 20 million ($6.8 million); a
transparent and open partnership structure; and the directors
of the company must have certain qualifications. The
establishment of such a company will be permitted upon the
approval through the affirmative votes of at least five members
of the Banking Regulation and Supervision Agency (BRSA).
Factoring companies must also obtain operating permission from
There are no specific types of factoring under the Law,
however, in practice, factoring is divided into four different
- disclosed and undisclosed;
- prepaid and non- prepaid;
- recourse and non-recourse; and,
- domestic and international.
According to article 9(2) of the Law, the receivables must
originate from the sale of services and goods of the customers
during the term of the factoring agreement. There are no
restrictions on the maturity of receivables. The factoring
company is also allowed to negotiate the
extension/restructuring of payment terms after purchasing
relevant receivables, since the principal and secondary rights
of the relevant transaction are transferred to the factoring
There is no registration process for assignments in Turkey.
Further, notification is not required to realise a valid
assignment against a debtor or third-party creditor. The only
requirement to achieve a valid assignment is that the agreement
must be made in written form.
Under Turkish law, it is possible to assign future
receivables as well as existing receivables.
In the event of a contractual prohibition against the
assignment of receivables, the debtor may refuse to make a
payment to the factor.
Işıl Ökten and Yasemin