Amendment to the Turkish Commercial Code No. 6102

August 17, 2018

Introduction Official Gazette 30361 was published and entered into force on 15 March 2018. It included lots of crucial amendments which has a really high effect on the Enforcement and Bankruptcy Law and Other Laws. The amendments law did not affect only Enforcement and Bankruptcy Law but also the Turkish Commercial Code Law numbered 6102[1](the “TCC”). The most significant amendment introduced to the Turkish Commercial Code is: As per the new rules, simplified legal proceedings will apply to commercial disputes with a value not exceeding TRY100,000. Amendment The effect of the amendment law on the TCC will lead to major changes in terms of the Turkish legal procedure. The written legal procedure was applied to all commercial disputes before the amendment law without any exceptions. After the new regulations, if the commercial disputes the value of which do not exceed TRY 100,000 (approximately 15,000 Euro), the simplified legal proceedings will apply for the purpose of quickness and effectiveness of the litigation process. Main Differences Between Simplified and Written Legal Procedure  There are two types of legal procedure which are the written and simplified in civil proceedings under Turkish Law. Although the written procedure is the main type, the simplified procedure has a significant role on Turkish Civil proceedings. The main difference between the two types of legal procedure is the number of the petitions’ submission. In other words, there are two rounds of written submission in the written procedure such as pleading, response and rebuttal, rejoinder. However, as the name implies, the simplified procedure is simpler and faster. Since the parties can file only pleading and response petitions in the simplified procedure this rule provides quickness and effectiveness of the litigation process. Other difference between the two types of procedure that are not as important as explained above is: The evidence or information about evidence that is not in their possession must be submitted within the exchange of petitions period. Differences of the written and simplified procedure in civil proceedings under Turkish law make a difference in terms of the time of submitting evidence. For instance, if the simplified procedure will be applied to any dispute, evidence or information about the evidence must be submitted with the pleading or response petitions. Overall, there is no doubt that the amendment law enhances the quality and speed of the judicial system of Turkey to provide a good environment for investors. [1]Law no. 7101 Amending the Law on Insolvency and Bankruptcy and Other Laws (the “Amending Laws”).

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An Obligation Originating From a Right: Usage of Trademark

August 16, 2018

On one hand, a registered trademark vests its proprietor broad authorities and exclusive rights; on the other hand it imposes some obligations to its proprietor. The most important of these obligations is the usage of the trademarkand it is foreseen in the Turkish Industrial Property Code. (‘’IPC’’) Conditions of trademark usage and situations that may be considered as usage of trademark are specified in IPC Art.9. Cancellation of a trademark due to the breach of usage obligation, is regulated in IPC Art.26. According to these articles, “Proprietor’s non-use of a trademark in Turkey staidly for five years from principal register date or recessing usage of trademark for five years continuously”are valid reasons for the cancellation of a trademark. The term “non-use of a trademark”means using a trademark beyond the scope of IPC Art.9 or in defiance of IPC Art.9. In accordance with the abovementioned article, these are the conditions for a trademark to be evaluated as a used-trademark: Usage of a trademark by its Proprietor Usage of a trademark in regard to goods and services for which the trademark is registered Not recessing the usage of a trademark for more than five years without any valid reason Using a trademark in Turkey Using a trademark staidly and severely Under the scope of IPC, there is no necessity for setting a trademark over goods tangibly in order for usage of a trademark. For instance, using a trademark for invoices related to goods and services which the trademark registered for, or using a trademark for publicity via media is enough for a trademark to be considered as used. Howevere, it is crucial to state that the usage of a trademark for only a part of the registered classes or groups of goods and services does not infer that usage of trademark obligation is fulfilled for all the registered classes and groups. Exceptional situations which are accepted as usage of a trademark, under the scope of IPC Art.9, 2nd para. , are as follows: Usage of a trademark with different factors or elements without any transformation of its distinctive character Usage of a trademark on products and packages just for exportation Usage of a trademark by 3th persons who are authorized by Proprietor ‘’Usage of a trademark with different factors or elements without any transformation of its distinctive character’’means usage of a trademark in different colors, shapes and dimensions or usage with insignificant additions or reductions. In that case, using a trademark by adding or reducing different factors is possible according to IPC Art.9 para. 2-a on condition that the distinctive character of the signs of the trademark is preserved and that the alteration does not cause a confusion in a way that the consumers may think there is a different trademark at hand. Although using a trademark in Turkey is a necessity for usage of trademark obligation, according to IPC Art.9 para. 2-b, using a trademark just for exportationis denoting “usage of trademark” in case of using trademark on products and packages. In such case, there is no obligation for releasing the products to the domestic market, however the trademark have to be […]

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Artificial Intelligence, Data Security and GDPR

August 9, 2018

Among the prominent features of artificial intelligence and machine learning, which are now being used in many sectors, the most important one is the ability to analyze data much faster from programmatic tools and from human beings as well as to learn how to manipulate data on its own. In recent years, profiling and automated decision-making systems, which are frequently used in both public and private sectors, have brought benefits to individuals and corporations in terms of increased productivity and resource conservation, as well as bringing about risks. The decisions made by these systems which affect the individual and the complex nature of the decisions, cannot be justified. For example, artificial intelligence can lock a user into a specific category and restrict it to the suggested preferences. Hence, this reduces their freedom to choose specific products and services, such as books, music or news articles. (Article 29 Data Protection Working Party, WP251, p.5) GDPR, which will come into force in Europe in May, has provisions on profiling and automated decision making, to prevent from being used in such a way as to have an adverse effect on the rights of individuals. GDPR defines profiling in Article 4 as follows: Any form of automated processing of personal data consisting of the use of personal data to evaluate certain personal aspects relating to a natural person, in particular to analyze or predict aspects concerning that natural persons performance at work, economic situation, health, personal preferences, interests, reliability, behaviour, location or movements.(WP251, p.6) Profiling is used to make predictions about people, using the data obtained from various sources on those people. From this point of view, it can also be considered as an evaluation or classification of individuals based on characteristics such as age, gender, and weight. Automated decision-making is the ability to make decisions with technological tools (such as artificial intelligence) without human intervention. Automated decision-making can be based on any type of data. For example, data provided directly by the individuals concerned (such as responses to a questionnaire); data observed about the individuals (such as location data collected via an application); derived or inferred data such as a profile of the individual that has already been created (e.g. a credit score). There are potentially three ways in which profiling may be used: (i) general profiling; (ii) decision-making based on profiling; and (iii) solely automated decision-making, including profiling (Article 22) The difference between (ii) and (iii) is best demonstrated by the following two examples where an individual applies for a loan online: a human decides whether to agree the loan based on a profile produced by purely automated means(ii); an algorithm decides whether the loan is agreed and the decision is automatically delivered to the individual, without any meaningful human input (iii). (WP251, p.8) The important questions to be encountered here are: How does the algorithm access this data? Is the source of data correct? Does the decision of the algorithm cause legal effects on the person? Can the individuals have some rights over the decision based on automated process? What measures should the data controllers take in this case? Nowadays, most […]

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Employee Invention Fee

August 7, 2018

At the present time, it is a known fact that people who deliver solutions about problems in the technical area are usually employed in R&D departments. According to Turkish Industrial Property Code (“IPC”), technical inventions which are made by these people, are bifurcated as: Free inventions Service inventions Pursuant to IPC Art.113, Service inventions are the inventions made by an employee as a part of her/his work at a firm or public administration or the inventions made by an employee during the employment relation, based on experience and operations of a firm or public administration. According to the second paragraph of the same article, every other invention except the service invention is accepted as free inventions. Judicially, when an employee makes any service invention, she/he is liable for making written notification to the employer without any delay.  After that notification, the employer is able to claim full or partial ownership of that service invention. In the case that the employer claims ownership, the employee may demand a fair amount of fee. In general;  the economic assessment of the invention, the position of the employee and the contribution rate of firm/public administration relative to making invention are taken into account during the evaluation of the fee. Moreover, the fee which is paid for the invention to the employee working at public administration, is determined by IPC Art. 113, para 5, indicated as ”the fee has to be more than one-third of the incomes acquired from the invention. However, if the invention is used by the public administration’s itself, the fee cannot be more than ten times the monthly net fee of the employee. ” On the other hand, there is no legislation about the invention fees for the other employees, except IPC Art.113; and in IPC, it is said that fee tariff regarding employee inventions and arbitration process will be drawn up by regulations. Therefore, in 29th of September 2017, “Regulation In Respect of Employee Inventions, Inventions Made In Higher Education Institutions and Inventions Occurred In Administratively Supported Projects” (“Regulation”) enters in force. In this Regulation,  Article 10 and the rest are related to the determination of invention fees. Like as IPC, according to that Regulation, Economical value of service invention Assigned position of the employee Contribution rate of firm/public administration relative to making invention are taken into consideration while determining fee amounts. Moreover, some formulas, ratios and coefficients regarding invention fee tariff are prescribed in the Regulation. Therefore, in case of full ownership claim by the employer and fee demand by the employee,  a one-off encouragement award and a separate fee evaluated according to formulas in the Regulation would be paid by the employer to the employee. Besides, in case of partial ownership claimby the employer, a fee would be paid to the employee in exchange for the usage of  invention by the employer. Furthermore, demanding a fee in exchange for the ownership of invention right of the employee is reserved each time. At the time employee request a fee in exchange for his/her invention, it is eligible to assure payment by writing a receipt, for providing a basis to employee’s assignment […]

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