Business Crimes and Anti-Corruption
Corporate and M&A
Istanbul Bar Association
Filiz Toprak Esin has been with the firm since 2006 and became a partner in 2020. Her practice is focused on business crime and anti-corruption, competition and corporate and M&A.
Filiz has broad experience in compliance matters including competition and white collar crimes. She has assisted various major multinational clients in their fight against corruption and provides preventive advice about their compliance process. At the same time, she represents executives of clients before relevant authorities and courts regarding white collar crimes related investigations and court actions.
Concerning competition law matters, in addition to her consultancy and training expertise, she is representing clients about any projects before the Turkish Competition Authority as well as any administrative court actions regarding decisions of the Competition Board.
Filiz has been involved in numerous M&A transactions and assisted clients who have investments in Turkey on their continuing legal needs.
English, Turkish, French
Cryptocurrencies were introduced to the Turkish market in July 2013 under the Law on Payment and Security Settlement Systems, Payment Services and Electronic Money. However, there are no limitations on or controls over cryptocurrencies, which is why many investors choose to invest their money in this area. While the interest in and impact of blockchain and cryptocurrencies are growing daily, the legal risks for blockchain and cryptocurrency platforms have yet to be fully understood.
The Supreme Court recently rendered an important decision concerning the protection of employees' privacy rights. The court reversed a first-instance labour court decision and ruled that the dismissal of an employee was unlawful on the grounds that the employer had used the employee's WhatsApp conversations (obtained in an impermissible way) as evidence, thus violating the employee's right to privacy.
The government has turned to the public-private partnership (PPP) model to achieve its aims of turning the Turkish healthcare sector into a model for the region. While such projects are expected to afford innovative opportunities for private sector players, it remains to be seen whether PPP is the ideal model for procurement of services in the healthcare sector or whether it ends up causing headaches for interested parties.
The Ministry of Health recently announced that it is planning to implement a compulsory civil set-off agreement model within the healthcare sector. While many examples of public set-off agreements can be found in other sectors, the idea has never been widely tested in the healthcare industry. Therefore, the sector is curious as to how this innovative model will be introduced.
The Competition Authority recently concluded its investigation into the pharmaceutical sector. The report notes two main concerns in relation to regulation in the pharmaceutical sector - protecting public health and ensuring the sustainability of pharmaceutical expenditure. The authority focused on the latter, with its investigation concentrating on the development of price competition at the supplier level.
The Regulation on the Determination and Enforcement of Target Investigation, Prosecution or Trial Periods was recently published in the Official Gazette. The regulation sets out the rules and procedures for determining the specific periods in which legal proceedings must be completed, thus ameliorating the judicial process. By establishing and adhering to time limits for legal proceedings, Turkey may be able to eliminate the delays in its judicial system.
The year 2019 was a busy one for Turkey with regard to anti-corruption and compliance matters. This article explores the developments from both a national and an international perspective. Among other things, the European Commission published its Turkey 2019 Report, the Organisation for Economic Cooperation and Development stated that it would establish a centre in Istanbul and Turkey introduced two new trial procedures to the criminal justice system.
Computers, computer programs and records used by suspects are among the most important evidence for public prosecutors who carry out external investigations relating to white collar crime. There is no definition of 'electronic evidence' in Turkey, but Article 134 of the Code of Criminal Procedure sets out the procedure for searching, copying and seizing computers, computer programs and records. An amendment to Article 134 concerning the collection of electronic evidence procedures was recently published.
In the absence of any clear guidance with regard to attorney-client privilege and white collar crime, the Competition Board's interpretation is a reference for future disputes and investigations. The board has held that companies subject to an investigation may refrain from disclosing their correspondence with their attorneys (and documents subject to this correspondence) provided that they explain who produced it and its purpose.
Transparency International recently published the 2017 Corruption Perceptions Index, which reflects the public sector corruption perspective of non-governmental organisations and representatives of the business world. Turkey came 81st out of 180 countries. This is the fourth consecutive year in which Turkey's ranking has fallen; it has lost 10 points and fallen 28 places over the past five years.
Transparency International recently published the 2016 Corruption Perceptions Index, which reflects non-governmental organisations' and business world representatives' perception of public sector corruption. Turkey came 75th out of 176 countries. This is the third consecutive year in which Turkey's ranking has fallen and its score is the lowest that the country has received in the past four years.
The Council of Ministers recently enacted a decree-law that amends Banking Law 5411 by introducing a sub-paragraph into Article 160, which regulates the crime of embezzlement committed by bank officers. While the need to make this amendment may at first be questioned, it should be read in light of the background of the crime of banking embezzlement.
Corporate liability remains a highly problematic and criticised issue in Turkey. In Turkish criminal law practice, criminal liability is deemed as personal, and criminal penalties can be imposed only on natural persons for crimes committed under a corporate body. Although the fact that corporate bodies can also commit crimes has long been established by the precedents of the Constitutional Court, criminal penalties are not specifically regulated under the criminal jurisdiction.
Following the failed coup attempt, the Council of Ministers declared a state of emergency and issued executive orders. The first order shut down a number of public and private institutions and many civil servants were discharged from their positions due to their alleged connection with the coup attempt in order to ensure national security. Further financial measures were adopted to prevent money laundering and the illegal international transfer of assets of the suspected institutions and persons.
Internal corporate investigations are key to combating white collar crime and the monitoring of personal and corporate communications is an indispensable tool in this regard. While Turkey has no specific or well-developed legislation on monitoring employee emails in internal investigations, a recent Constitutional Court decision has clarified a number of relevant points.
Turkey stands out as a target market for US companies that want to expand their global reach due to its geographical location, growing population and economy. Having subsidiaries and establishing a distribution system via third-party agents in Turkey means the risk of exposure to the Foreign Corrupt Practices Act. Six recent cases involved Turkish parties and five of these involved subsidiaries or third-party agents.
The fight against corruption is a serious challenge for the pharmaceutical sector. Turkey has taken positive steps regarding transparency and disclosure in the pharmaceutical sector through the Regulation on the Promotional Activities for Medicinal Products for Human Use, which requires pharmaceutical companies to disclose transfers of value to healthcare professionals and organisations.
A recent corruption case involving embezzlement and bribery by the chairman of a non-profit organisation provides an example of the Fifth Judicial Reform Package's new asset recovery practice. The result of the case is not yet clear, but it illustrates that the identification and confiscation of assets generated by crime is being taken seriously and that the corporate veil can be pierced by the prosecutor's office.
The Fifth Judicial Reform Package introduced a requirement for the competent authority to prepare a report in order for a confiscation decision to be rendered during criminal investigations. However, the enforcement of this provision over the past year has raised concerns and in some cases led practitioners to contemplate potential alternatives for asset recovery.
The graft probe investigations – which included corruption allegations against bureaucrats, several prominent business figures, the mayor of Istanbul and the sons of three ministers – have turned their attention towards the people who initiated and managed the investigations. This update focuses on the new direction of the investigations and the impact that amended procedural rules have had on ongoing procedures.
In recent months, Turkey has been rocked by a series of high-profile arrests on charges of corruption, with the Public Prosecution Office targeting bureaucrats, several distinguished businessmen, a mayor of Istanbul and the sons of three ministers. To avoid such investigations, companies must assess carefully and more broadly the risks resulting from their activities.
Having a compliance programme in place does not eliminate the risk of being confronted with a criminal investigation or penalty. However, because Turkish criminal law requires wilful intent to commit an act of bribery, such a programme can be provided as part of a full defence strategy from the perspective of an accused company to demonstrate that the company had no intention of committing a crime.
Turkey is undergoing a transformation in regard to how it sees corruption and bribery and how it deals with such acts. Society is becoming more aware of and more interested in the fight against corruption, and is no longer taking corrupt systems lightly. Consequently, Turkey may expect less criticism from international bodies and advocates of anti-corruption activities in this regard in future.
In addition to measures addressing domestic bribery, steps have recently been taken to combat foreign bribery in Turkey. The provision setting out penalties for the bribery of foreign public officials has been amended and the scope of the definition of 'foreign public officials' has been widened. Furthermore, a new paragraph has been added to the Commercial Code that covers foreigners who bribe foreign officials outside Turkey.
Anti-bribery and anti-corruption, which have not yet been strongly differentiated in Turkey, have become hot topics in recent years. The Turkish public, lawmakers and the judiciary have all taken a staunch approach against bribery, albeit each in their own way. In line with this trend, a recent amendment to the Criminal Code has widened the scope of the definition of 'bribery'.