Draft Law Proposal for Liquidated Investment Funds Finalized
A draft law proposal regulating the process of investment funds liquidated by decisions of the Capital Markets Board has been prepared.
The draft law proposal regulating the process of investment funds whose liquidation was decided by the Capital Markets Board has been finalized. The proposal guarantees the recovery of values unlawfully removed from the fund assets and fair payments to shareholders.
Scope and General Objective of the Proposal
The draft law proposal regulating the liquidation process of investment funds whose liquidation was decided by the Capital Markets Board has gained clarity. The proposal legally guarantees the recovery of values unlawfully removed from fund assets during the liquidation process, collection from responsible parties, and the fair distribution of the acquired resources to fund shareholders.
Liquidation Process and Determination of Entitlement
Liquidation transactions will be carried out by banks and institutions appointed under the supervision and oversight of the Capital Markets Board. Rights holders will be determined by reconciling the records of the Central Registry Agency, Takasbank, TEFAS, portfolio custody, and distribution institutions.
No payments will be made from the liquidation and recovery account to individuals determined to have committed acts contrary to capital market legislation, or to have engaged in manipulation or market fraud.
Net Investment Amount and Interim Payment Principles
In cases where the fund assets are insufficient to make full payments to all investors, the net investment amount to be used as the basis for payments will be calculated by the Central Registry Agency. In this calculation, cash inflows and outflows will be indexed using the arithmetic average of the consumer price index and the producer price index.
An interim payment equal to the net amount can be made for those whose net investment amount is below 1 million liras, and a maximum of 1 million liras for those with an amount of 1 million liras and above.
Personal Liability for Responsible Parties and SDIF Authority
All values transferred from fund assets through transactions that are contrary to legislation, unrequited, or collusive will be considered unlawfully removed. The portfolio management company will be held primarily liable for the resulting loss, and in cases where collection is not possible, the identified real and legal persons will be held personally liable.
The Savings Deposit Insurance Fund will be able to initiate forced execution and enforcement on the assets of the responsible parties by using its powers under the relevant law and can be appointed as a trustee.
Recovery Account Regulations
All revenues collected, returned, and obtained from sales will be tracked under a Recovery Account opened specifically for each fund within the Savings Deposit Insurance Fund. The amounts in these accounts cannot be seized even for public receivables.
Recovered amounts will be transferred to institutions tasked with liquidation or to the Investor Compensation Center to be distributed to shareholders.