SURETY LEGISLATION IN TURKEY
1. GENERAL CONDITIONS OF SURETY INSURANCE
The General Conditions of Surety were published by Prime Ministry Undersecretariat of Treasury on January 29, 2014 and entered into force with the "Amendment of the Insurance Branches" published on October 2014.
It will be useful to review and reorganize the current general conditions of surety insurance, which is offered as an alternative to bank letters of guarantee, in order to be accepted in the markets and find a response in practical application.
Our comments regarding the improvement of general conditions in article 7 below, in Turkish.
2. ADDITION TO PUBLIC PROCUREMENT LAW AS COLLATERAL
The following amendments were made in the Public Procurement Law no. 4734 with the Law on the Amendment of Some Tax Acts and Some Other Laws published in the Official Gazette dated 05 December 2017 and numbered 30261.
"ARTICLE 65- The following definition has been added to the 4th Article of the Public Procurement Law No. 4734 dated 4/1/2002:
"Letter of Guarantee: means the guarantee letters issued by banks and surety bonds issued by resident insurance companies in Turkey"
With this amendment made in Public Procurement Law numbered 4734, surety bonds have been accepted as a guarantee letter by adding to the definition of guarantee letter. As a result of this amendment, tenderers will be able to give surety bonds issued by insurance companies as guarantee letter.
3. BUILDING COMPLETION INSURANCE
Building Completion Insurance is a kind of surety. At the prepaid residential / office / commercial area sales:
If the seller fails to complete the immovable property due to the death, insolvency, or in the contract period, the insurance company accepts and undertakes to repay the price paid by the buyer or to complete the building with the building completion insurance.
4. THE PROTECTION OF THE CONSUMER LAW
Law No. 6502 dated 7/11/2013 on the protection of the consumer, and Article 42, Guarantee, has issued the Building Completion Insurance.
5. THE REGULATION ON PRE-PAID HOUSING SALES
Official Gazette dated 27 November 2014; The Regulation on Pre-Paid Housing Sales published by the Ministry of Customs and Trade has been issued in the Article 12- Guarantee and the Article 13- Building Completion Insurance.
6. GENERAL CONDITIONS OF BUILDING COMPLETION INSURANCE
On 11 March 2015, Prime Ministry Undersecretariat of Treasury issued the General Conditions of Building Completion Insurance.
7. OUR COMMENTS REGARDING THE IMPROVEMENT OF SURETY INSURANCE GENERAL CONDITIONS
Since the comments are in Turkish, see the related Turkish page.