July 2008
The Law on the Procedure of Collection of Public Debts is Amended
With the Law no. 5766 titled “Law on Amendments in the Law on the Procedure of Collection of Public Debts and Some other Laws” published in the Official Gazette on the 6th of June 2008, some significant amendments have been made in the Law no. 6183.
Some of the most significant amendments are as follows:
1 – The definitions of “uncollectable public debt” and “public debt whose collection proved to be impossible” have been added to the definitions in the article 3.
2 – Four new paragraphs have been added to the article 35 and it is set forth that in case of a transfer of shares of a limited company both transferor and transferee will be jointly responsible from the public debts before the transfer. Moreover, joint responsibility is provided for previous and new managers and for previous and new shareholders in cases where managers or shareholders are different at the times when the debt is born and when it became due.
3 – The new article 36/A brought the possibility to ask for prohibition of going abroad for the debtors who failed in paying their debts arisen from the Law on Procedure of Taxation and Customs Law. Accordingly, going abroad of the debtors of public debts can be prohibited by competent authorities on the demand of relevant tax office if the debtor fails in paying taxes and related fines and pecuniary penalties within the scope of this law within seven days after the receipt of the payment order or if a decision of ancillary attachment is given for the goods of the debtor.
However the Law brought the possibility to ask for prohibition of going abroad only for the debts whish are over one hundred thousand YTL and which are not guaranteed.
4 – The article 48 whish regulates the deferral of public debts is also amended. The distinction between the two years deferral period for the cases listed in the law and the period of five years for other cases has been abrogated and a general deferral period of thirty six months is set forth. Besides this, the conditions for deferring public debts became easier and the condition of guarantee is abrogated for the debts below YTL 50.000.
The issue of prohibition of going abroad is re-regulated
As mentioned above, with the new regulation the prohibition of going abroad will apply only for public debts which are not guaranteed and which are over one hundred thousand New Turkish Liras. The Council of Ministers is entitled to increase this sum up to ten times, decrease it up to half of it and to bring it again to the sum mentioned in the law.
Additionally, the prohibition of going abroad can be cancelled by competent authorities on the demand of the relevant tax office if a guarantee is given for the payment of the public debt, or the debt is deferred, or a decision on insolvency of the debtor is given, or courts decided to suspension of execution, or one of the legal reasons for suspension of execution is present.
The procedure for the sale of motor vehicles is changed.
According to the new regulation brought by the article 18 of the law, sale and transfer proceedings of the vehicles registered as of 01.08.2008 will be made by the traffic registration offices. Every sale or transfer which is not made by the traffic registration offices will be invalid.
Before the said regulation, public notaries used to be in charge of transfer proceedings of motor vehicles. However, in practice motor vehicle transfers used to be made in simple written form in order to avoid transfer expenses. This situation used to lead to some problems such as difficulties in determining the last owner of the vehicle or difficulties in the registration of the proceedings. Although one may think that this regulation is advantageous from these points of view, it should also be considered that traffic registration offices do not have the necessary infrastructure and staff for this work load.
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