ERDEM-NEWSLETTER-2018-metin

257 LAW OF OBLIGATIONS Although the Decree is silent as to how the parties will convert to Turkish currency, this issue is clarified in Article 8/24 of the Com- muniqué. Accordingly, upon failure of the parties to come to an agree- ment while re-determining the Turkish currency amounts, the foreign currency amount shall be converted to Turkish currency from the indicative effective selling exchange rate of the Central Bank of Tur- key announced on 2 January 2018, and the converted amount shall be increased based on the monthly exchange rate of the consumer price index rate (TÜFE) determined by the Turkish Statistical Institute for each month (“TÜFE”), applicable from 2 January 2018 until the re- determination date. Article 8/24 of the Communiqué introduces a special rule for existing residential premises and roofed workplace lease contracts. Accordingly, foreign currency amounts that are the subject of such contracts shall be re-determined based on the calculation method described, above, for a period of two years. In the event of parties’ disagreement as to the rental amount for the following rental term, TÜFE shall apply to the re-determined amount, and the resulting amount shall be applicable for one year as of the end of the rental term in which the re-determination is made. For the next rental term, in the event of the parties’ disagreement, again, TÜFE shall apply to the last re-determined amount, and shall be applicable until the end of the two-year term as of the date of the first re-determination. Sanctions for Non-Compliance with the Decree In accordance with Article 3 of the Law on the Protection of the Value of Turkish Currency (“Law”), those who violate the obligations laid down by the general and regulatory rulings of the Decree and the President shall be subject to an administrative fine between TRL 3,000 and TRL 25,000. As per Article 17/7 of the Law of Misdemeanours, administrative fines shall be increased each year in accordance with the re-appraisal rates, making the fines applicable in 2018, varying between TRL 5,631 and TRL 46,964. In addition to the administrative fine to be imposed, for the pe- riods between the date of the violation and the date of collection, a delay interest shall apply at the rate of delay increase to be determined