Draft law expanding legal shield of company trustees accepted in parliamentary commission

Draft law expanding legal shield of company trustees accepted in parliamentary commission

Draft law expanding legal shield of company trustees accepted in parliamentary commission

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A recent controversial draft bill which will expand the legal shield given to the boards of trustees appointed to companies and enable them to have broader authority was accepted by the parliamentary commission after a 15-hour discussion period on June 18, as reported by Anadolu Agency. 

The commission declined to extend the crime definition in the new draft law. 

Harsh criticisms were made by opposition parties and several business organizations against the draft bill, though lawmakers from the ruling Justice and Development Party (AKP) robustly defended the changes.

With the new bill, the scope of the authority of trustees appointed to companies will be extended, as the partnership stakes or stock management of seized companies will also be transferred to the trustees. The existing law stipulates that seized companies can demand compensation from the trustees for their losses.

The recent bill, however, notes that such lawsuits can be opened against the state, but not against a board of trustees. 

A deputy from the main opposition Republican People’s Party (CHP) said the regulation would seriously harm the right to conduct business. 

“We know that many companies to which trustees were appointed faced bankruptcy,” said Cemal Okan Yüksel, a CHP deputy from the Central Anatolian province of Eskişehir. 

“With the new regulation, the state will pay the losses of any company to which a trustee board is appointed… You are accepting this law to create a legal shield for your trustees,” he added. 

Justice Minister Bekir Bozdağ said the recent changes in the law were made to enable trustees to do their jobs without facing any pressure or threat. 

Bozdağ noted that trustees become a natural part of investigations regarding the companies to which they were appointed, as “they help the authorities.” 

“They however face many threats in this process. Many companies or people threaten to open a lawsuit against them,” he said. 

Due to such threats, many trustees could not perform their duties and responsibilities in many cases, he said. 

“The new regulation was made to create a space to them devoid of any fear, pressure or threat so as to do their jobs. The state will have recourse to them. The same is the case for judges and prosecutors,” added Bozdağ. 

Meanwhile, the Turkish Business and Industry Association (TÜSİAD) requested an urgent revision of the draft law, which it said was prepared without taking the views of all stakeholders, creating risks for companies’ reputations and private ownership rights. 

“This draft law needs to be reviewed thoroughly in terms of its potential risks, mainly over their business reputation and private property rights,” said the TÜSİAD in a written statement on June 17.