Port operations in Turkey

Port operations

What government approvals are required in your jurisdiction for a port operator to commence operations following construction? How long does it typically take to obtain approvals?

A private entity port operator that has already successfully entered into a PPP agreement with the government must submit a facility information form and a business permit application document and certain supporting documents in order to commence operations. The private entity port operator must apply to the Examination, Determination and Audit Commission with the required documents to get port operation permission.

What services does a port operator and what services does the port authority typically provide in your jurisdiction? Do the port authorities typically charge the port operator for any services?

Private port operators perform all port services for their ports. The government is not involved in providing port services when a private entity is the port operator.

Does the government or relevant port authority typically give any commitments in relation to access to the hinterland? To what extent does it require the operator to finance development of access routes or interconnections?

The general practice is for operators to finance and develop access routes and interconnections. According to the Ministry of Development’s five-year development plan for 2014-2020, one of the goals of the Turkish government is to realise hinterland connections from existing ports by road and rail. As such, we expect to see a continued increase in hinterland connection projects.

How do port authorities in your jurisdiction oversee terminal operations and in what circumstances may a port authority require the operator to suspend them?

The Examination, Determination and Audit Commission has the right to supervise ports. If any non-conformity is detected by the Commission, a maximum of six months is given by the Commission to correct the non-conformity. If the private entity does not correct the nonconformity, the Commission can suspend operations until the private company corrects the problem. The permission to operate the port may also be cancelled by the Commission if the documents provided by the operator are deficient. Further, if the name, coast facility name or the type of operation written in the permission to operate changes, the permission becomes invalid.

In what circumstances may the port authorities in your jurisdiction access the port area or take over port operations?

Accessing the port area is generally possible if there is a court decision granting such a right. If there is reasonable doubt or a court decision, law enforcement agencies may also access the port. Further, auditors from the Examination, Determination and Audit Commission may access the port. The Turkish Tax Inspection Board may also supervise port operations.

What remedies are available to the port authority or government against a port operator that fails to operate and maintain the port as agreed?

Pursuant to Law No. 3996, the agreement between the administration and the private entity is a private law agreement if the relationship is part of a BOT PPP project. The administration may terminate the agreement if the conditions for termination set out in the agreement occur, and the auditors from the Examination, Determination and Audit Commission may suspend or cancel the permission to operate. The administration can also apply to Turkish courts (or arbitration if it is provided for in the agreement) for remedies generally available under private law contracts.

What assets must port operators transfer to the relevant port authority on termination of a concession? Must port authorities pay any compensation for transferred assets?

Such requirements would be included in the terms of the PPP agreement, which is negotiated on a case-by-case basis.