Hedging And Derivatives in Turkey

Derivative transactions include hedging transactions and over the counter (OTC) transactions and are regulated under the Turkish Derivative transactions can be entered into with a Turkish bank or a Turkish intermediary institution, provided that the bank or intermediary institution has a speciic license from the Capital Markets Board for that purpose. Recent legislative changes also brought OTC products under the supervision of the Capital Markets Board. Therefore, a speciic license to be able to directly enter into bilateral OTC products with clients as counterparty is required to be obtained.

It is also possible for a company to enter into derivatives transactions with another company, provided that entering into such derivatives transaction does not fall within the scope of either company’s activities or constitute a commercial activity for any of the parties.

Such transactions are not under the supervision of the Capital Markets Board and the capital markets legislation does not apply.