The regulations amending (i) the Regulation on the Establishment and Operating Principles of Financial Leasing, Factoring and Financing Companies and the (ii) Regulation on the Establishment and Operating Principles of Asset Management Companies and Transactions Regarding the Receivables to be Taken Over were published in the Official Gazette dated 27 August 2025 and numbered 32999 (“Amendment Regulations”).

Amendment Regulations introduce significant changes, particularly regarding the rules on participation principles, and the operational limitations of the companies.

Pursuant to Amendment Regulations, Financial Leasing, Factoring, Financing, and Asset Management Companies (“Companies”) will only be able to operate based on the participation principle to the extent of the resources they provide in compliance with the participation principle. It is stipulated that Companies operating exclusively under the participation principle must include the phrase “Participation” (Katılım) in their commercial titles, and their Articles of Association must state that they will operate in accordance with the participation principle. Furthermore, the procedures and principles regarding the Companies’ operation under the participation principle will be determined through secondary legislation to be issued by the Banking Regulation and Supervision Agency (“BRSA”).

With respect to Financial Leasing, Factoring, and Financing Companies (“FLFF Companies”), establishing partnerships or participating in existing partnerships that qualify only as credit institutions or financial institutions both domestically and abroad is made subject to BRSA approval. However, stock investments made by FLFF Companies for trading purposes, the acquisition of shares for the collection of receivables, and participation in capital increases of partnerships are not subject to BRSA approval. Furthermore, it is regulated that FLFF Companies may not directly or indirectly own shares in the partnerships and institutions that directly or indirectly hold shares in them, nor can they accept the shares of these entities as collateral or advance funds against them.

Regarding the amendments concerning asset management companies, it is stipulated that independent audit of information systems shall be conducted once every three years, and that they may raise funds from their partners to carry out their main activities. Furthermore, it is made mandatory that the assumptions used in the estimation of cash flows must be consistent and realistic, documented in writing, and kept ready for auditing.

For participations that are compulsorily acquired due to taken-over receivables, BRSA approval is not required; however, the regulator must be notified within 15 days, and these participations must be disposed of within three years.

Additionally, it is stated that source institutions subject to the supervision and oversight of the BRSA may only transfer their receivables to asset management companies that they control or are controlled by through an auction procedure. However, this provision shall not apply to asset management companies where the Savings Deposit Insurance Fund is a shareholder holding at least twenty percent of the shares, and these institutions may transfer to the asset management company not only non-performing loans but also receivables where the collection of principal and/or interest payments is overdue by more than 60 days.