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Legal Alerts

16/06/2020

Additional Reporting Requirement for Transactions Affecting FX Positions

Legal Alerts
Banking & Finance
Financial Institutions

Recent Developments

As per the Regulation on the Procedure and Principles regarding the Central Bank of the Republic of Turkey’s Monitoring of Transactions Affecting the FX Position (”Regulation”), Turkish companies the aggregate of foreign currency loans and foreign currency indexed loans balance of which amounts to USD 15 million or more as at the end of a quarterly accounting period are obliged to report their FX position to the Central Bank of the Republic of Turkey (“CBRT“). The companies must report their FX positions quarterly and utilizing a standard reporting form issued by the CBRT.

In addition to the abovementioned quarterly reporting requirement, the CBRT’s new announcement also introduced an additional weekly reporting requirement for companies.

Companies will report their financial data, separated into FX and Turkish lira liabilities, to the CBRT on a weekly basis by using the corporate monitoring weekly data form (“Data Form“) prepared by the CBRT.

Companies must send their weekly reports to the CBRT’s official email account until the CBRT’s close of business on every Tuesday beginning on June 16, 2020.

The Data Form’s instructions clearly state which account subjects must be reported to the CBRT. Pursuant to the Data Form, weekly reports will be made in accordance with Tax Procedure Law No. 213 and no rediscount or accrual calculation will be expected from the relevant companies.

Companies with weekly reporting requirements must pay attention to the CBRT’s instructions to prevent providing inaccurate or incomplete data entries on the Data Form.

Conclusion

The CBRT recognizes the necessity of regular monitoring of current economic developments and the effects of economic policies and establishes a stricter monitoring mechanism for Turkish companies. Accordingly, the CBRT will monitor the companies’ FX positions through weekly and quarterly reports.

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