Name
Global FinTech Guide
Country _ Name
Turkey
SectionTitle
Asset and portfolio management
Body
FinTechs belonging to this category offer asset and portfolio management services via an internet platform or software programs and usually manage and dispose of the assets of their customers long or short term according to their specifications without actually holding the property or the possession of those assets. FinTechs, which provide information about and access to overnight or time deposit accounts at national and foreign banks and which execute the transactions to these accounts, also belong to this category. Some FinTechs however only act on request of the customer.

Aside from that some FinTechs offer software or internet solutions enabling users to manage and plan their personal finances on their own by providing graphics, overviews and compilations of their financial data and sometimes indicating financial risks or opportunities, but without actually managing the assets.

Introduction

Attitude of the country towards modern asset and portfolio management services

Funds and fund administrators are primarily regulated by the Capital Markets Law no. 6362 (“CML”) and secondary legislation published by the Capital Markets Board (“CMB”). All activities related to funds management are subject to strict rules determined by the CMB and require a licence.

Legal affairs

Obligations and requirements to provide asset and portfolio management, or ancillary services described above

Under Turkish law, funds are managed by the portfolio management companies defined under the CMB’s legislation. The Communiqué on Portfolio Management Companies and Principles Regarding Their Activities, Serial No III-55-1 (“PMC Communique”) provides strict statutory requirements for the establishment, activities, organisation, internal control, risk management, and personnel of the portfolio management company, to assure performance and accuracy.

In order to obtain a portfolio management company license, the following conditions apply:

  • Establishment as a joint stock company subject to the registered capital system in accordance with the provisions of the Turkish Commercial Law no. 6102.
  • Having all of its shares registered.
  • Having their shares issued against cash.
  • TRY 6 million (approx. EUR 340,000) as initial capital.
  • The Articles of Association following the provisions of the CML and the CMB regulations.
  • Having shareholders fulfilling the conditions for portfolio management company founders.
  • Transparent and clear ownership structure.

Founders apply to the CMB for a foundation permit by submitting:

    a. Foundation application form and draft Articles of Association prepared in accordance with the standards determined by the CMB.

    b. Notary-certified declaration prepared in accordance with the formats given in annexes 1 and 2 of the PMC Communique.

    c. Notary-certified copies of decisions taken by authorised organs of founding legal entities, related to participation in the Company as a partner.

    d. Documents authenticating that the founders satisfy the foundation conditions set forth under the PMC Communiqué.

    e. Other information and documents that may be requested by the CMB.

Application for license to CMB is free of charge. However, the cost may be as much as EUR 15.000 or more including incorporation, translation of documents, notary public fees, legal fees, and other ancillary costs. Also, the minimum capital requirements apply.

In order to be entitled to start its portfolio management activities, a company is under obligation to apply to the CMB for the required permission for activity and license within

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