Some amendment stating that the contract price and other payment obligations arising from those contracts cannot be denominated in or indexed to foreign currency for certain types of contracts that will be executed between persons residing in Turkey was made on the decree no. 32 on the Protection of the Value of Turkish Currency by Presidential Decision numbered 85 and dated 12.09.2018. After the amendments, exceptions determined by the Ministry are included to the article 8 of the Communiqué No 2008-32/34 on the Decree No. 32 on the Protection of the Value of the Turkish Currency.

On April 19, 2022, with the introduction of Communiqué No. 2022-32/66 Amending the Communiqué No. 2008-32/34[1], the phrase “However, it is obligatory to fulfill and accept the contractual payment obligations in Turkish currency.” is added to the end of paragraph nine of the said article 8, and the expression of “to denominate” used in paragraph fifteen is changed as “to denominate, pay, and accept”.

Recently on April 21, 2022, a press briefing on the Communiqué No. 2022-32/66 has released on the web page of Ministry of Treasury and Finance to provide further details on the implementation of Communiqué No. 2022-32/66.[2]

Accordingly, it is stated that, through Communiqué No. 2022-32/66 amendments, while it is aimed to protect the exception that allows the contract prices to be denominated in foreign currency or indexed to foreign currency in movable sales contract to not interrupt the functioning of the market and the continuity of trade, it became obligatory to fulfill and accept the contractual payment obligations in Turkish currency.  Public institutions, and organizations and Turkish Armed Forces Foundation companies to be exempted from this obligation.

On the other hand, for the persons residing in Turkey;

  1. Within the scope of the execution of the movable sale contracts concluded between themselves before 19.04.2022, it is not obligatory to fulfill and accept the payment obligations in Turkish Currency for the negotiable documents in foreign currency circulated before the effective date of the Communiqué numbered 2022-32/66,
  2. It is not obligatory to fulfill and accept the payment obligations within the scope of invoices issued before 19.04.2022, in Turkish Currency,
  3. It is not obligatory to fulfill and accept payment obligatory in Turkish Currency for the trading of the precious metals and precious stones in foreign currency and exchange of these operations, in Borsa İstanbul A.Ş. Precious Metals and Precious Stones Market By the decisions of the Ministry.

 Furthermore,

  • It is useful to specify that, the term movable in the Communiqué covers all kinds of goods and commodities that do not fall under the definition of immovable,
  • Since this amendment concerns the payment obligations of the movable sale contracts which were executed/will be executed between persons residing in Turkey, it is not obligatory to fulfill and accept the payment obligations in Turkish Currency for the movable sale contracts which were executed/will be executed between persons residing in Turkey and persons residing abroad,
  • Check and so on payment instruments issued in foreign currency on 19.04.2022, when the amendment entered into force, and after shall not be used to fulfill the payment obligations of the movable sale contracts which were executed/will be executed between persons residing in Turkey,
  • This amendment does not include a provision that changes the current status of vehicle sales contracts, contract price and other payment obligations arising from vehicle sale contracts that will be executed between persons residing in Turkey, cannot be denominated in or indexed to foreign currency, just as before and after the amendment made on 19.04.2022,
  • The contracts regarding the operations executed within the scope of the Law no 4749 on Regulating Public Finance and Debt Management are subject to paragraph seventeen of article 8 of the Communique and obligations of these contracts are not within the scope of the amendment made on 19.04.2022,
  • Within the framework of the Capital Market Law No. 6362 and the regulations made based on this Law, making, exportation, trading of the capital market instruments (including foreign capital market instruments and depository receipts and foreign investment fund shares) and obligations of these executed operations can be denominated in foreign currency by the paragraph eighteen of the article 8 of the Communique, and obligations of the executed operations are not within the scope of the amendment made on 19.04.2022,
  • No amendment regarding the fulfillment and acceptance of the payment obligations of contracts other than the movable sale contracts stated in the other paragraphs of the article 8 of the Communique, in Turkish Currency has been made and the current exceptions are valid.

[1] (OG. 19.04.2022/31814)

[2] Ministry of Treasury and Finance. (2022, April 21). Announcement regarding the Communiqué No. 2022-32/66 amending the Communiqué No. 2008-32/34 [Press release]. Retrieved from https://www.hmb.gov.tr/haberler/turk-parasi-kiymetini-koruma-hakkinda-32-sayili-karara-iliskin-2008-32-34-sayili-tebligde-degisiklik-yapilmasina-dair-2022-32-66-sayili-teblige-iliskin-duyuru