1. COMMERCIAL LAW Dr. Özlem Döğerlioğlu Işıksungur 2013 Summer School Notes-Summary

2. Capital Labor Entrepreneur Organisation Specific purpose Craftsman enterprises are not accepted as commercial enterprise. ENTERPRISE

3. Article 11 of TCC ▫“An enterprise that will be operated permanently and independently aiming to generate income which exceeds the limit prescribed for the craftsman enterprises.” DEFINITION of ENTERPRISE

4. COMMERCIAL ENTERPISE The person who operates the commercial enterprise, in principal, MERCHANT Affairs related to Commercial Enterprise, Commercial Affair Commercial Provisions are applied to Commercial Affairs The case is “commercial case” if it is concerning both parties’ enterprises Application of commercial customs for the commercial affairs Commercial Interest for the Commercial Affairs. First: Check whether there is a “commercial enterprise or not” If the answer is yes, then above mentioned results

5. There are four components of commercial enterprise: ▫Economic activity-  It must be “generate income oriented” ▫It must be continuous ▫It must be independent ▫Its scope must exceed the craftman’s scope of activities ELEMENTS OF “COMMERCIAL ENTERPRISE”

6. The main purpose and objective of commercial enterprise must be to generate income. What should be taken into consideration? ▫Purpose/Intention of the entrepreneur is of importance ▫Result is not of importance (to profit or to lose money). ▫Way of income spending is not of importance ▫Legal status of the person who operates enterprise is not of importance  Doctor/Engineer ELEMENTS: 1-Economic Activity

7. Commercial enterprise must have been established to operate continuously (not temprorary or fortuitous). What should be taken into consideration? ▫Intention and nature of the undertaking Disruption of the operation? Periodical activities?  Running school buses for the students during the periods when the schools are open  Operating hotels in winter ELEMENTS: 2-Continuity

8. The organisation must be independent from any other Independency for entrepreneur& enterprise Branches? Agency? ELEMENTS: 3-Independency

9. Distinction concernig whether an enterprise is a commercial enterprise or craftsman enterprise shall be made according to the Council of Ministers Decree Currently such kind of decree is not be published Until its publication, legislation in effect shall be applied ( Decision No: 2007/12362- Official Gazette 21.7.2007, S. 26589) ▫Takes place in the craftsmen and artisans group ▫Economic activity depends on capital and physical activity ▫Earning is below the amount for merchant ▫exempted from income tax ▫Basic method application of income tax (Commercial earnings acquired on simple earnings basis, represents the positive difference between the revenues generated and the expenses incurred and the acquisition costs of the goods sold within one account period.) ELEMENTS:4- Exceeding of the craftman’s scope of activities

10. Article 15 of TCC Craftman

11. Structure of Commercial Enterprise Human--- Merchant ▫Person who operates commercial enterprise on his name Assets---- TCC Article 11.3

12. CONCEPT of “merchant” Regulated in Article 11-23 of TCC Merchants: ▫Real (natural) persons ▫Legal person In TCC, “merchant” concept regulated seperately from the point of “real person” and “legal person” Regulated in Article 11-23 of TCC Merchants: ▫Real (natural) persons ▫Legal person In TCC, “merchant” concept regulated seperately from the point of “real person” and “legal person”

13. MERCHANTMERCHANT REAL (NATURAL)PERSONS LEGAL PERSONS Definition: Person who operates a commercial enterprise, at least in part,under his name. Elements: -Existence of a commercial enterprise -Operation of the commercial enterprise, at least in part -Operation of the commercial enterprise, at least in part, under the name of the person concerned Definition: Person who operates a commercial enterprise, at least in part,under his name. Elements: -Existence of a commercial enterprise -Operation of the commercial enterprise, at least in part -Operation of the commercial enterprise, at least in part, under the name of the person concerned Commercial companies Associations & Foundations which operate commercial enterprise to achieve their targets Entities which are formed by State, Private Provincial Administration, Municipality, Village and other public corporations to be operated in a commercial manner or pursuant to their statutes of foundation to be managed according to private law Commercial companies Associations & Foundations which operate commercial enterprise to achieve their targets Entities which are formed by State, Private Provincial Administration, Municipality, Village and other public corporations to be operated in a commercial manner or pursuant to their statutes of foundation to be managed according to private law

14. REAL PERSON merchant- DEFINITION Definition: (Article 12.1 TCC) ▫The person who operates a commercial enterprise, at least in part, under his name Definition: (Article 12.1 TCC) ▫The person who operates a commercial enterprise, at least in part, under his name

15. ELEMENTS OF REAL PERSON MERCHANT Commercial Enterprise De facto operation Operation under the name of the merchant = MERCHANT

16. REAL PERSON merchant- CONDITIONS A- Existence of a Commercial Enterprise ▫General rule: To qualify as a merchant, existence of commercial enterprise is the first condition ▫Elements of commercial enterprise? BUT A person who although has not established a commercial enterprise, enters into relationship with third parties as if he had formed a commercial enterprise, shall be held liable like merchant against third parties in good faith A- Existence of a Commercial Enterprise ▫General rule: To qualify as a merchant, existence of commercial enterprise is the first condition ▫Elements of commercial enterprise? BUT A person who although has not established a commercial enterprise, enters into relationship with third parties as if he had formed a commercial enterprise, shall be held liable like merchant against third parties in good faith

17. REAL PERSON merchant- CONDITIONS A- Existence of a Commercial Enterprise- CONTINUE ▫Elements of commercial enterprise  Economic activity  Continuity  Independency  Capacity A- Existence of a Commercial Enterprise- CONTINUE ▫Elements of commercial enterprise  Economic activity  Continuity  Independency  Capacity

18. REAL PERSON merchant- CONDITIONS B- Operation of the commercial enterprise ▫What is the meaning of “ operation of commercial enterprise?  Establisment of an enterprise  Enter into business dealings with third parties ▫De facto operation ▫TCC Article 12/II  “Bir ticari işletmeyi kurup açtığını, sirküler, gazete, radyo, televizyon ve diğer ilan araçlarıyla halka bildirmiş veya işletmesini ticaret siciline tescil ettirerek durumu ilan etmiş olan kimse, fiilen işletmeye başlamamış olsa bile tacir sayılır”  The person involved should have started the operations. If he/she has entered the establishment  with register of commerce and publication or  has made annnouncements to the public, whether through newspapers or by distributing letters or leaflets, adverstising establishment,  he would still be regarded as a merchant  Rights&obligations of being merchant B- Operation of the commercial enterprise ▫What is the meaning of “ operation of commercial enterprise?  Establisment of an enterprise  Enter into business dealings with third parties ▫De facto operation ▫TCC Article 12/II  “Bir ticari işletmeyi kurup açtığını, sirküler, gazete, radyo, televizyon ve diğer ilan araçlarıyla halka bildirmiş veya işletmesini ticaret siciline tescil ettirerek durumu ilan etmiş olan kimse, fiilen işletmeye başlamamış olsa bile tacir sayılır”  The person involved should have started the operations. If he/she has entered the establishment  with register of commerce and publication or  has made annnouncements to the public, whether through newspapers or by distributing letters or leaflets, adverstising establishment,  he would still be regarded as a merchant  Rights&obligations of being merchant

19. REAL PERSON merchant- CONDITIONS C- Operation of the commercial enterprise at least in part, under the name of the person concerned ▫“at least in part” – jointly operation of enterprise by more than one person ▫Operation of the enterprise by merchant is not compulsory  On behalf of merchant, anyone may operate the commercial enterprise  “Merchant character” belongs to whom? Worker? C- Operation of the commercial enterprise at least in part, under the name of the person concerned ▫“at least in part” – jointly operation of enterprise by more than one person ▫Operation of the enterprise by merchant is not compulsory  On behalf of merchant, anyone may operate the commercial enterprise  “Merchant character” belongs to whom? Worker?

20. SPECIAL CONDITIONS- MERCHANT? Minor Not being in full possession of his mental faculties Barred from involving in commercial business Civil servants Dealing in commercial activities depended on a permission Minor Not being in full possession of his mental faculties Barred from involving in commercial business Civil servants Dealing in commercial activities depended on a permission

21. SPECIAL STUATIONS People who are minor and who are under guardianship People barred from involving in commercial business Dealing in commercial activities depended on a permission People who are minor and who are under guardianship People barred from involving in commercial business Dealing in commercial activities depended on a permission

22. SPECIAL CONDITIONS- MERCHANT? A- People who are minor and who are under guardianship : According to TCC Article 13, if the commercial enterprise is operated by a legal representative (guardian by nature or curator) on behalf of the people who are minor and who are under guardianship, these people shall be deemed as merchant ▫Legal responsibility derived from being merchant belongs to people who are minor and who are under guardianship but criminal liablity belongs to guardian by nature or curator A- People who are minor and who are under guardianship : According to TCC Article 13, if the commercial enterprise is operated by a legal representative (guardian by nature or curator) on behalf of the people who are minor and who are under guardianship, these people shall be deemed as merchant ▫Legal responsibility derived from being merchant belongs to people who are minor and who are under guardianship but criminal liablity belongs to guardian by nature or curator

23. SPECIAL CONDITIONS- MERCHANT? People who are minor and who are under guardianship : ▫who are under guardianship?  Insanity (madness)  Weakness of the mind  Prodigality ( savurganlık), toxicomania (alcohol,narcotic), bad lifestyle, bad management  Jail sentence (one and over one year)  Demand People who are minor and who are under guardianship : ▫who are under guardianship?  Insanity (madness)  Weakness of the mind  Prodigality ( savurganlık), toxicomania (alcohol,narcotic), bad lifestyle, bad management  Jail sentence (one and over one year)  Demand

24. SPECIAL STUATIONS B-People barred from involving in commercial business Article 14/I of TCC: The person who are deprived of or prohibited from dealing in commercial activities because of ▫Their personal status or ▫The position/profession they occupy ▫Prohibition: Legal provision or Judgment ▫Permission required: (person or legal authority) ▫Deemed as merchant accordingly, if they are engaged in commercial enterprise ▫Kişisel durumları ya da yaptığı işlerin niteliği nedenyle yahut meslek ve görevleri dolayısıyla, kanundan veya bir yargı kararından doğan bir yasağa aykırı bir şekilde ya da başka bir kişinin veya resmi makamın iznine gerek olmasın rağmen izin ve onay almadan bir ticari işletmeyi işleten kişi de tacir sayılır (TTK.m.14/I, B-People barred from involving in commercial business Article 14/I of TCC: The person who are deprived of or prohibited from dealing in commercial activities because of ▫Their personal status or ▫The position/profession they occupy ▫Prohibition: Legal provision or Judgment ▫Permission required: (person or legal authority) ▫Deemed as merchant accordingly, if they are engaged in commercial enterprise ▫Kişisel durumları ya da yaptığı işlerin niteliği nedenyle yahut meslek ve görevleri dolayısıyla, kanundan veya bir yargı kararından doğan bir yasağa aykırı bir şekilde ya da başka bir kişinin veya resmi makamın iznine gerek olmasın rağmen izin ve onay almadan bir ticari işletmeyi işleten kişi de tacir sayılır (TTK.m.14/I,

25. SPECIAL STUATIONS B- People barred from involving in commercial business- Cont. ▫Example: Civil servants  prohibition related to commerce  If operates commercial enterprise  Shall be deemed as merchant  At the same time, the person shall be subject to legal, criminal and disiplinary sanctions according to their private law  For civil servants disiplinary sanction

26. SPECIAL STUATIONS C- Dealing in commercial activities depended on a permission

27. SPECIAL STUATIONS The position of married women ▫To operate a commercial enterprise, Permission from husband is not required

28. DIFFERENCES - TO BE DEEMED AS MERCHANT AND TO BE (LIABLE) RESPONSIBLE AS MERCHANT Person deemed as merchant, shall benefit from the rights and be responsible for the obligations that derived from being merchant Person who is responsible as merchant, shall only be responsible as merchant but shall not benefit from the rights given to merchant

29. Legal person merchant A.Commercial companies B.Associations which operate commercial enterprise C.Foundations which operate commercial enterprise D.Entities which are formed by State, Private Provincial Administration, Municipality, Village and other public corporations to be operated in a commercial manner or pursuant to their statutes of foundation to be managed according to private law

30. Loss of MERCHANT position For real person merchant ▫In which conditions:  Closure of commercial enterprise  To end operating the commercial enterprise under his name ▫How?  Notification to register of commerce + demand for the cancelation of the register  To declare property ▫When?  Within 15 days

31. Loss of posITION OF BEING MERCHANT For legal person merchant ▫In which conditions:  Cessation of legal personality ▫How?  Completion of liquidation procedure  cancelation of the register (publication)

32. Consequences of being MERCHANT Regulated in Article 18- 23 of NTCC ▫Subject to banckruptcy ▫Registration to the register of commerce ▫Registration to the Chambers ▫Selection and usage of trade name ▫Subject to presumption of commercial affair ▫Subject to trade customs and usage ▫To keep commercial books ▫To behave as a prudent business man ▫To claim fee and interest ▫To claim discount in the fee and interest ▫To pass an invoice ▫Right of objection against invoice and confirmation letter within 8 days ▫Form requirement for all notices and notification ▫Benefit from the easiness concerning the usage of lien ▫Subject to special provisions concerning sales and change of goods.

33. Affairs  Ordinary affairs– commercial affairs  Commercial affairs are different from ordinary affairs and subject to different rules

34. COMMERCIAL AFFAIRS A- TCC Article 3  The ones which are regulated in the TCC  The ones which are concerning the commercial enterprise B- TCC Article 19- presumption  The debt of the merchant is commercial. (19.1)  Exception for real person merchants C- Affairs which is deemed commercial for one party (19/2) The contracts which are deemed as commercial for one party, shall be accepted as commercial for the counter party

35. A-The Affairs Regulated in TCC The affairs regulated in the TCC, shall be deemed as “commercial” whether it is related to commercial enterprise or not—absolute commercial affair Example ▫Valuable document ▫Unfair competition

36. A- Affairs concerning commercial enterprise  These are:  All prosedure and acts that take place in the other Acts (Laws-Codes) and that pertain to the commercial enterprise  All acts of the commercial enterprise  Example:  A merchant buys machines to use in the commercial enterprise  To rent an office to use as a pharmacy  To give power of attorney to a lawyer concerning a dispute derived from commercial enterprise.

37. B-Presumption of “commercial affair” Real Person MerchantLegal Person Merchant Two options to be deemed as ordinary ▫Explicitly declaration of the counter party  Ex. Purchasing washing machine for personal usage ▫As the case may be  Ex. Puchasing washing machine, (there is no explicitly declaration) but the delivery address is home address. All of the affairs of the legal person merchant are commercial ▫Ex. Company, rents a property for the employees’ usage.

38. What happens if the affair is accepted as commercial for one party and ordinary for the counter party? TTC 19.2 ▫Unless otherwise provided in the TCC, any contract that has commercial character for one party shall be deemed as commercial for the counter party ▫Ex. Sales contract between merchant and civil servant ▫Conditions  Contract  Unless otherwise provided in the TCC ▫If Relationship between the parties derived from tort or unjust enrichment, this provision is not applicable

39. Consequences of Commercial Affairs  Validity of Presumption of solidarity (joint and several obligation) concerning the commercial affairs  Application of commercial interest  Legal limitation periods  Application of commercial provisions  Legal Disputes – Commercial Case

40. Presumption of solidarity Solidarity : Consecutively, joint and several liability concerning the commercial affairs Generally two types of solidarity: ▫Among creditors: Payment of total debt to one of the creditor ▫Among debtors: Right of creditor to apply anyone of the debtors Article 7 of TCC In TCC, solidarity among debtors ▫Conditions:  Two or more person should be in debt against one creditor  For one of them or both of them, source of the debt should be “commercial affair”  Unless otherwise mentioned in Law or contract The guarantors --- “co-debtor and joint guarantor” ▫YTK Md. 7 “İki veya daha fazla kişi içlerinden yalnız biri veya hepsi için ticari niteliğe haiz bir iş dolayısıyla diğer bir kimseye karşı birlikte borç altına girerse, kanunda veya sözleşmede aksi öngörülmemişse müteselsil sorumlu olurlar Ticari borçlara kefalet hâlinde, hem asıl borçlu ile kefil, hem de kefiller arasındaki ilişkilerde de birinci fıkra hükmü geçerli olur. ”

41. Interest Concept of “interest” Definition: A fee which one party pays to the counter party (in return for deprivation of the usage of money for a specific period ), for the privilege of using borrowed money

42. Types Of Interest  Capital interest- Default interest  Simple interest-Compound interest  Legal interest-Conventional interest