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Using bonds to obtain credit
In addition to principal capital and reserve funds, which consist of accumulated earnings, incorporated companies avail of loans to carry out their activities and achieve their goals. Such loans are based first on their net assets, and second on their foreign assets.
Throughout late 2003 and early 2004 the Turkish Capital Markets Board (CMB) promulgated a number of new regulatory acts. This update outlines the highlights of the new legislation, including the new Communiqué on the Sale and Registration of Shares with the CMB.
The domestic Capital Markets Board promulgated a number of new regulatory acts towards the end of 2003. The Capital Markets Law authorizes the board to issue regulations on the cumulative voting system with the aim of striking a balance between majority and minority shareholders of publicly held companies, and securing the rights of minority shareholders.
Recent Developments in Securities Regulation
As well as introducing new concepts in Turkish securities regulation to the communiqués which are currently in effect (eg, the shelf registration system), the Capital Markets Board has issued several important new communiqués in the past few months.
Sector Developments
The Capital Markets Board has announced its programme for 2003. Highlights include the creation of an arbitration organization in order to enable the efficient resolution of securities disputes, the establishment of a best practice code and the preparation of an amendment to the Turkish Commercial Code permitting joint stock corporations to acquire their own shares.
Communique Changes
The Capital Markets Board has recently amended several communiques, including those concerning portfolio management, mutual funds, margin trading and capital adequacy of intermediary institutions.
