Local Ford Otomotiv was sentenced to the highest fine, 68.8 million liras, while Tofaş, the domestic maker of Italian Fiat cars, followed with 47.8 million liras.

Top executives from the producers and sellers continued to defend themselves until a final hearing last week in Ankara.

The board finalized its investigation on 23 companies Tuesday.

One of the main pieces of evidence the board mentioned during the last hearing was an inter-company email from a Nissan executive that asked: “Have you talked with the competitors? What will they do?”

In an earlier response, a Nissan attorney said the writer of the email intended to inform Europe and Japan representatives of Nissan before they left Turkey.

“This is not systemic. It is only about conveying a fresh piece of information,” said the attorney.

Karsan, one of the three bidders for the future taxis of New York City, and Otokar, a vehicle maker also involved in the defense industry, were found not guilty on the charges, along with Borusan, General Motors, Honda, İsotlar Oto, Mazda, and Şahsuvaroğlu, according to the final decision read to parties by Erkan Yardımcı, the vice president of the board.

Yardımcı said contacts on future pricing and sales strategies, stocks and targets were evaluated by the board.

One of the basic accusations was on an alleged meeting among 13 car companies at which a short-term price increase was agreed to by all parties only three days after the end of a temporary lift on Special Consumption Tax, or SCT, in March 2009. The decision said all the accused companies implemented the agreed-upon price increase.

Four companies in 2006 and 15 companies in 2008 met to discuss whether to reflect sharp current exchange rate changes of the lira and the euro in consumer prices, the decision said.

The parties have the right to appeal a higher court.

Ford and Tofaş units declined in Istanbul trading following the announcement of the antitrust board’s decision.

Ford Otomotiv dropped 20 kuruş, or 1.4 percent, to 13.95 liras. Tofa declined 6 kuruş, or 0.7 percent, to 8.66 liras.

Antitrust violation fines (in liras)

Ford Otomotiv: 68.844 mln

Tofaş: 47.803 mln

Doğuş Otomotiv: 49.785 mln

Mais: 26.638 mln

Peugeot: 20.328 mln

Toyota: 16.841 mln

Hyundai Assan: 15.871 mln

Mercedes Benz Türk: 10.452 mln

Baylas Otomotiv: 7.061 mln

Temsa: 5.429 mln

Nissan: 4.481 mln

Çelik Motor: 3.285 mln

Anadolu Araçlar: 268,990

ALJ Otomotiv: 220,220

Mermerler: 107,708

source: hurriyet

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Speaking to the Anatolia news agency, officials from the Finance Ministry said the government could introduce incentives for the replacement of old vehicles with new ones. Having initially introduced tax cuts on motor vehicles on March 16 for a period of three months, the government decided to extend the terms for another three months on June 15. The private consumption tax (ÖTV) on motor vehicles with engines of up to 1,600 cubic centimeters was set at 27 percent, while the tax on commercial vehicles was changed to 3 percent. Extended for a second time, the tax incentives are due to expire at the end of September.

Noting that they have studied examples of incentives for old vehicles in foreign markets, the Finance Ministry officials said the government could consider introducing such incentives in the coming months, expecting to keep the recovery going in the auto industry. Encouraged by recent tax cuts, the Turkish auto sector has enjoyed a remarkable increase in sales.

As one Finance Ministry official put it, incentives for old vehicles are not new in Turkey; they were introduced in 2003. The government introduced an ÖTV reduction in 2003 for people who scrap vehicles older than 20 years to buy a new car. However, the incentives were misused by some auto dealers. “Some of the auto dealers collected most of the old vehicles to benefit from the incentives,” he said. In another similar incentive program, the government decided to reduce the number of aging vehicles on the roads in March of this year.

The incentives aim to boost new vehicle sales and decrease accidents.

The Finance Ministry official said that more than introducing incentives for old vehicles, the government places heavy importance on making necessary legal adjustments. Making mention of studies still under way on the issue the official said the new incentives could cover a variety of applications for motor vehicles of different ages. “We are considering introducing incentives for people who have owned a car for at least the past one year. Also, three different tax cuts for vehicles aged 10, 15 and 20 years are on the table.” The officials also said incentives for old vehicles could be made permanent.

The Economic Coordination Council is expected to discuss the new program in its meeting at the end of this month. The Cabinet will have the final say on the issue.
source: Today’s Zaman

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After experiencing a 70 percent contraction in sales amid global financial turmoil, real estate agents in Alanya and Bodrum said sales had increased by 40 percent in just the last few weeks compared to the period prior to the KDV cut. Upon hearing of the tax break, parties interested in buying property here came from Norway, Denmark, Germany, the Netherlands and Ireland.

Alanya Real Estate Agents Association (ALEKOD) President Kerim Balıktay said the KDV reduction was the perfect “medicine” for the ailing sector. Underlining that they expect to sell some 10,000 residences in the coming months, he said they hope to earn 1 billion euros from the sales.

Bodrum Real Estate Agents Union (BEMDER) President Ömer Yetgin said sales in Bodrum increased by 45 percent following the KDV reduction. “Our sales contracted by around 90 percent, but now there is great interest — especially among foreigners — in the purchase of residences. Some of our colleagues had no chance but to close their real estate agencies amid a terrible financial bottleneck; however, there is a serious recovery in the market, at least for the time being,” he said.

Noting that the lowered KDV had reinvigorated the sector, Fethiye Real Estate Agents Union President Nevzat Tilkici said the price of residences fell by 40 percent compared to previous years. He said they had seen a 50 percent increase in sales, particularly in Side, Datça and Çeşme.

Nevzat Ersoy, the head of contractor Ersoy İnşaat, said their customers predominantly come from Norway, Denmark and the Netherlands. Tourists mainly choose residences by the seaside or with a view of the forest, he said.

Prices of residences in tourism hotspots

In Alanya, Antalya province’s famous tourist center, prices vary between 35,000 euros and 200,000 euros. In some of the most attractive parts of this famous district, a triplex villa with a view of the sea sells for 150,000-400,000 euros.

In Fethiye, know as the “pearl of the Aegean,” residences go for 30,000-100,000 euros, while prices in Bodrum, famous for its natural beauty, hover around 50,000-240,000 euros.
source: Today’s Zaman

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After making it possible for Turkish citizens abroad to bring money back into Turkey under the Varlık Barışı tax regulation, the government is now looking for ways to make it easier for citizens of the Gulf states and Turkic republics to buy real estate in Turkey.

The Varlık Barışı code made it easier for Turkish citizens abroad to invest in Turkish assets by lowering and under certain circumstances eliminating the heavy taxes levied on foreign holdings coming into the country.

Taking action
The first step the government is taking to make it easier for the citizens of the Gulf States and Turkic republics to buy real estate in Turkey is taking into consideration the reciprocity principle. This principle is based on the idea that the ability to purchase real estate is a reciprocal right, whereby, if a Turkish citizen can buy real estate in the country in question, then the citizen of that country may purchase real estate in Turkey.

Citizens in oil rich countries in the Arabian Peninsula, such as Saudi Arabia, the United Arab Emirates, Qatar and Kuwait, as well as citizens from the Turkic republics in Central Asia, have been lining up to buy real estate in Turkey. Their efforts have been thwarted thus far because there has not been an agreement on the reciprocity principle.

The demand in real estate from these parts of the world has brought to attention the need to reconsider the agreements in place. The Ministry of Foreign Affairs is updating the running list of reciprocity agreements in an effort to bring the practice in line with the current circumstances. After the Ministry of Foreign Affairs updates the old list and produces a new one, the legal framework will be renewed to better reflect the updated reciprocity list. The relevant ministries will then sign off on the new legal framework making it easier for citizens of the Gulf States and Turkic republics to buy real estate in Turkey.

Exceptions to the rule that citizens of the Gulf States and Turkic republics cannot buy real estate have been made but at the highest echelons of government. For example, because there was no reciprocity agreement when King Abdullah bin Abdülaziz of Saudi Arabia wanted to buy 57 acres of land in Sevda Tepesi overlooking the Bosphorus, the Turkish Cabinet had to make a special provision for it.

The Ministry of Foreign Affairs has taken the first step in making it easier for foreigners to own property in Turkey by taking the reciprocity agreements under review, said Land Registry Agency vice president Şinasi Bayraktar noting the complexities of figuring out the polices in place in different countries. “The issue of the reciprocity principle is one that requires expertise and detail oriented attention,” said Bayraktar. The complexity of determining whether relations between two countries obey the reciprocity principle can lead to confusion. “Situations arise where in some countries it looks like there is reciprocity when there is not and in others it looks like there is not but in reality there is,” said Bayraktar. There are times, according to Bayraktar, when the official channels are not sufficient to discover whether or not there is reciprocity in land ownership. “Sometimes it is not healthy to hash out the details of this issue with just embassies,” noted Bayraktar.

“We are going to take up this issue once again. The Ministry of Foreign Affairs is already taking it under consideration,” said Bayraktar. “There is a lot of demand from the Gulf states and the Turkic republics,” he said.
source: Hurriyet daily news

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Under the bill Turkish expatriates will be encouraged to bring their money to Turkey under an “assurance” and by paying a 2 percent “nominal tax.” Turks residing inside the country will be able to put their cash savings in banks subject to a 5 percent tax rate.

Profits earned outside the country will be exempt from income and corporate tax if they are brought to Turkey by May 31, 2009. Turkish citizens will have to declare the current value in Turkish lira of their savings and property — money, gold, foreign currency, securities and capital market instruments and all fixed assets — to banks, brokerage houses or tax offices within three months after the law is published in the Official Gazette. The government will not carry out any inspections on the sources of savings for the term before Jan. 1, 2008, unless there is a pending specific complaint regarding the origin of funds. During debates on the bill at Parliament, Finance Minister Kemal Unakıtan told lawmakers that the government would take action on funds if there is evidence that money laundering has happened. “It is impossible to blame someone for something for which you have no evidence,” Unakıtan said in Parliament. “But of course, we do not want drug money or money earned from terrorism or illegal arms sales,” he said.

Once the law comes into effect, citizens will either transfer their money to Turkey via banks or physically bring their money within a three-month period. A significant amount of money is expected to flow into Turkey thanks to this regulation, economy officials said, noting that the main goal of the regulation is to reduce Turkey’s current account deficit.
source: Today’s Zaman

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A consortium comprised of Russian Atomstroyexport and Inter Rao along with Turkey’s Park Teknik Group was the sole bidder in a tender to build and operate Turkey’s first nuclear power plant in Mersin on the Mediterranean coast. Turkey plans to build three nuclear power plants with a capacity of 4,000 megawatts, plus or minus 25 percent, as part of efforts to reduce a costly dependence on energy imports.

Turkey is still considering the bid submitted by the Russian-Turkish group, the Energy Ministry source said.

“There have to be some changes in the nuclear tender law for the second tender. The changes will also be valid for the Mersin tender if that tender is cancelled,” the Energy Ministry source told Reuters.

Many companies had requested changes to the law before the tender. Analysts say it doesn’t provide enough guarantees to investors. Analysts expected Turkey to cancel the tender after it received only one bid from an initial thirteen companies that had initially bought tender documents for the plant. ong the companies which had previously expressed interest in the tender were Sabancı, General Electric, Hitachi Nuclear Energy and Spanish utility Iberdrola.
source: Hurriyet daily news

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The projected plan aims to attract Gulf capital to Turkey by creating interest-free instruments such as rent certificates, real-estate partnership bonds and participation certificates — known as sukuk in Islamic finance terminology. Anonymous sources from the government informed Today’s Zaman that the Treasury has already started working on these instruments and has sent a draft of a bill to the prime minister’s office. The same sources stated that the details will probably be publicized in a week’s time.

The idea of creating Shariah-compliant financial tools to attract capital owners with religious sensitivities against interest-yielding instruments has been on the current administration’s agenda since it first came to power in 2002. But to avoid fierce rejection by secular powerhouses, it had to shelve its intentions despite the fact that even centers of capitalism like the US and Britain have taken a great interest in interest-free finance. But global financial turbulence and the concurrent liquidity squeeze made the establishment of these interest-free tools urgently necessary.

After the prime minister’s office completes its review of the draft, it will send it to the Cabinet for approval. Finally, the draft must be approved by Parliament to become law.

According to information provided by the sources, the Treasury will first issue YTL 1 billion in bonds. These Islamic bonds will also help money in the coffers of participation banks — Islamic financial institutions in Turkey that provide interest-free banking services – remain within the Turkish financial system. These banks usually invest their excess capital in Shariah-compliant fund management instruments abroad since there have until now been no such instruments in Turkey. Therefore, the Treasury’s ability to garner wealth from the domestic market will also increase. The new instruments will be based on the revenue of wealth-generating assets such as highways, bridges and dams. Since these notes do not promise a set profit — unlike interest-yielding Treasury bills — the government hopes Gulf capital will flow into Turkey to purchase them.

Thanks to high oil prices — which rose as high as $140 a barrel a few months ago — the oil-rich nations of the Middle East have enjoyed a great accumulation of wealth, especially over the last year. Suffocated by the lack of liquidity needed to break free of the current bottleneck, the whole world is eyeing this capital nowadays and pondering new means to attract it.

Speaking to Today’s Zaman about the government’s intentions to create interest-free financial tools, Bank Asya General Manager Ünal Kabaca said this would do a great deal to open doors to the inflow of Gulf capital. Türkiye Finans General Manager Yunus Nacar was also jubilant upon hearing about the government’s project. “Participation banks were not able to lend to the Treasury, but now it will be possible for them to invest their funds with more options,” he said.
source: Today’s Zaman

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One thousand applications were completed within the first minutes of the implementation of the gentleman’s agreement between operators. However, no information was given regarding the distribution of those first 1,000 subscribers among the operators.

The number portability practice, which allows customers to keep their existing mobile phone number when switching operators, started in Turkey on Sunday.

The practice has been widely discussed in the industry as Turkey’s three leading GSM operators; Turkcell, Avea, and Vodafone, eye new customers who might be unhappy with their present operator.

NEW OFFERS FROM OPERATORS
Competition between mobile service providers has already heated up. Although it is illegal in the midst of the changes, GSM operators launch campaigns and special offers to attract users in a race to grab subscribers from their rivals.

Turkcell, Turkey’s biggest GSM operator with 36.3 million subscribers, launched a “free calls for two days” campaign, which will be available to the first million contract users who apply by SMS between Nov. 8 and Dec. 28.

Vodafone, Turkey’s second largest operator with 17.5 million subscribers, said it would announce new campaigns and special offers in the coming days.

In addition to its existing tariffs, Avea, which has 11 million subscribers, has promised to give new subscribers a latest model free mobile phone.

Meanwhile, the GSM market is predicted to grow by 15 percent during the first year of the new system and the number of consumer campaigns to increase more rapidly.

A total of 7 million subscribers are expected to switch operators following the implementation of the new practice.
source: Hurriyet daily news

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The heat insulation projects of new buildings and modifications in existing buildings must be carried out according to the standards of the TS 825 regulations, said Ulu, adding that this situation in turn would pave the way for more efficient energy use. Residents in buildings that are heated with room heaters will have to install insulation between both the walls and floors, according to the new standard, said Ulu. Residents will also have to use insulated windows from now on according to the new standard, he added.

The fact that all the modifications to buildings, from changing windows to heat insulation, have to be carried out in tandem with the new standard has been an extremely significant improvement, both for the industry and consumers, said Ulu. This will in turn facilitate growth in the industry he said, noting that consumers would also feel the luxury of living in warmer houses thanks to these developments.
source: Turkish Daily News

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The officials plan to present the draft to the Cabinet for approval shortly. Under the proposed legislation, the government will apply three different deduction rates to money transfers from abroad to encourage foreigners to bring capital into the country. These deductions will allow them to bring in an unlimited amount of capital without facing questions into the source the money. Foreign nationals will have three months to declare their intention to bring their cash holdings into the country. The three-month period will begin when the law is promulgated and published in the Official Gazette.

Foreigners will first apply to a bank or a tax office and declare the amount of money they brought or are planning to bring, under the assurance of being exempt from questioning. They will also declare their intention to spend the money. For money to be deposited in a bank account for at least a one-year period, spent on Treasury bills or state bonds or used in buying real estate, there will be a 0.5 percent deduction.

If foreign capital owners fail to declare how they will invest their holdings, a 1 percent cut will be applied to their money. As a third option, a 2 percent deduction will be taken from those who have not yet brought their money into the country, but have declared their intention to do so. An official, speaking on condition of anonymity, said the legislation aims to provide foreign capital owners with options and flexibility.
source: Today’s Zaman

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Any country that signs a free trade agreement with the EU enjoys tariff-free access to the Turkish market, a one-way trade that works to the disadvantage of Turkish producers, According to the 1996 customs union agreement.

The EU was trying to convince South Korea to sign another free trade agreement with Turkey as well, officials from Turkey’s Undersecretariat of Foreign Trade (DTM) Referans daily reported.

In a similar move, the Turkish Foreign Ministry is asking the EU to encourage South Korea to pursue an agreement with Turkey that would balance the bilateral trade, Referans added.

However, Seoul has not yet officially responded to Turkey’s proposal, South Korea’s ministry of foreign affairs and trade said the country had started assessing the impact of a free trade agreement with Turkey, the Korea Herald reported on Thursday.

According to the ministry, the South Korean government has already hired experts to investigate the possible effects of free trade with Turkey on the country’s economy. The ministry said South Korea’s free trade agreement with the EU, currently being discussed by the two parties, was motivating Turkey to seek a trade pact with Asia’s fourth-largest economy.

PREACAUTIONS TO BE TAKEN
Some protections would be in place for sectors that might be affected by duty-free Korean goods and emphasized that the agreement with the South Koreans might contribute to cooperation in the future, Referans said citing the officials.

These sectors included automotive, linen and fabric, textiles, and especially flat iron and color televisions, officials said. All these industries constitute an important portion of Turkey’s exports.

It would take two years to wrap up talks and sign a free trade agreement with South Korea if the two countries agreed to start today, they added.

PRIVATE SECTOR CONCERNED
Representatives of the private sector said they were also worried by the EU-South Korean agreement. Such an agreement with South Korea might cause problems in the flat goods and stainless steel sectors, Veysel Yayan, general secretary of the Turkish Iron and Steel Producers Association was quoted as saying.

“We do not have the same chances with South Korea. Otherwise, we would not object to this. However, the iron-steel industry in South Korea is subsidized by the state, and energy and other costs are subsidized by the state,” he added. South Korea is the sixth-biggest steel producer in the world.

The EU recently signed similar agreements with Chile and Mexico, but Chile rejected Turkey’s suggestion to sign a bilateral deal.

Since these countries consider it unnecessary to sign a free trade agreement with Turkey because they can automatically enter the Turkish market via the EU, foreign ministry presses the EU to obligate their trade partners to sign similar agreements with Turkey.
source: Hurriyet daily

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The EIB has a special mission of extending favorable loans to support investment in European countries and in countries that are involved in the EU accession process. The bank can provide loans with repayment terms starting up to eight years after disbursement of funds and terms extending up to 30 years.

With the agreement, the Turkish government is allowing the EIB to open two major offices, one in İstanbul and one in Ankara, and several representative offices connected to these main offices. The EIB will be able to invest in securities and real estate, to strike deals and make contracts with businesses as well as sell property.
source: Today’s Zaman

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