On January 29, 2015, Turkey enacted the Law on Regulation of Retail Trade, regulating the establishment, operation and auditing of shopping malls, retail dealers, department stores, chain stores, artisans and craftsmen ("Retailers"). Retailers have one year and, in some instances, up to two years, to bring their operations into compliance.
Retail Information System: PERBIS
The Ministry of Customs and Trade will establish a new retail information system, Perakende Bilgi Sistemi (“PERBIS”), to manage Retailers' workplace opening and operation licensing applications and create a database for Retailers.
Applications for workplace opening and operating licenses may either be made directly to the municipality, provincial special administration, or other administrative body entitled to grant workplace opening and operation licenses ("Licensing Authority"), or through PERBIS.
Applications made directly to a Licensing Authority will be registered in PERBIS. Following a Licensing Authority review, approved applications will be delivered to the applicant through PERBIS. The review is limited to determining whether the conditions required by law have been fulfilled.
New obligations for retailers
The Retail Law imposes the following new obligations on Retailers, including:
Store-branded products must bear the producer's name or brand.
Common areas, such as emergency medical care units, prayer rooms and child care rooms, must be established in shopping malls.
Space for artisans and craftsmen must be allocated in shopping malls.
Starting and ending dates of sale campaigns and shopping "festivals" must be set before the campaign or festival.
Discount stores that sell clearance, season-end, export surplus or defective goods must clearly indicate both in their display windows and in the store that they only sell on discount.
Payments on supply agreements between manufacturers/suppliers and Retailers must be made on the date specified in such agreements. For fast-moving consumer goods, however, payments between small manufacturers or suppliers and large-scale Retailers must be made within 30 days.
Retailers can only demand premiums or additional charges if the type and ratio of the fee for services such as advertisement, announcement or shelf allocation are stated in an agreement. In this case, (i) the premium or fee will be limited to the agreement period, and (ii) products subject to the premium or fee will remain on the shelves for the duration of the agreement period.
The breach of an obligation may result in the imposition of administrative fines.
The Retail Law also introduces other new rules:
A local government can set all or certain Retailers' hours of operation, if jointly requested by professional organizations and the favorable opinion of the Licensing Authority is obtained.
The Weekend Holiday Law no longer applies to Retailers, so Sunday work permits are no longer necessary.
Retail dealers, department stores, chain stores and authorized enterprises may not charge producers or suppliers fees that do not directly affect product demand, such as bank and credit card membership fees, store opening and alteration fees, and revenue shortfalls.
Actions to consider
Companies should consider how these significant changes may affect their operations in Turkey and take steps to ensure compliance with the Retail Law.