Financial leasing, factoring and financing companies are required to be established as joint-stock companies and have at least five founding shareholders. Their boards must have at least three members who have relevant expertise and experience.
The share capital requirement for the companies is increased to TL20 million ($10.3 million), which is required to be paid in full and cash at the time of the incorporation of the company.
Share transfers of 10% or more, share transfers which result in the change of control of the companies, and mergers, acquisitions and de-mergers of the companies are subject to the permission of the Banking Regulation and Supervision Board.
Leasing agreements related to immovable assets must be registered at the land registry, whereas agreements to lease movable assets must be registered at the Financial Leasing, Factoring and Financing Companies Association.
All kinds of movable and immovable goods may be subject to leasing, except patent rights, intellectual and industrial rights.
Leasing companies are allowed to make cash loans for a maximum amount of 1% of their total paid in capital. The Banking Regulation and Supervision Board can reduce this amount to zero and can increase it up to five percent of the total paid-in capital of the companies.
Sale and lease-back transactions are now regulated under the new Law. This provides the companies regulated by the Law with a new method of financing. Moreover, if the lessee purchases a leased immovable asset, this transaction is exempt from the stamp duty.
If the investment has been made through financial leasing, the lessee can use the incentives provided for purchasing the leased assets.
In addition, the financial leasing agreements, the documents for transferring and amending these agreements and the security documents related to these agreements are exempt from stamp duties and the transactions are exempt from charges.
The new Law provides more flexibility to financial leasing, factoring and financing companies, such as the removal of the requirement for financial leasing agreements to have a minimum term of four years.
The new procedure shortening the time frame of legal proceedings in the event of default of the lessee, and the incentives and tax advantages of the financial leasing agreements are also remarkable.
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