Lawyers, economists criticize gov’t takeover of Kaynak Holding

The appointment of trustees to manage Kaynak Holding, which consists of 23 companies including the countryand’s largest publishing house, has been strongly criticized by a number of lawyers and economists, who have questioned the legal justification for the takeover and expressed concern about the protection of property rights in Turkey.
Former Justice Minister Hikmet Sami Tandurk told Todayand’s Zaman on Wednesday that the move to appoint trustees to Kaynak Holding is a clear violation of property rights and the right to free enterprise. He went on to say that trustees can only be appointed to a company if there is strong evidence indicating its involvement in illegal acts. Tandurk also said that the takeover of Kaynak does not meet the conditions required by the Turkish Penal Code (TCK) and thus constitutes a violation of basic legal rights.
The Istanbul 10th Criminal Court of Peace ordered the appointment of trustees to take over the management of the holding in a controversial move on Wednesday morning, when trustees escorted by police officers went to the headquarters of the holding in the Baicilar area of Istanbul.
Kaynak Holding owns the largest publishing house in Turkey, the Kaynak Publishing House, and the NT Maiazalari nationwide bookstore chain and employs more than 8,000 people.
A significant share of the Kaynak Publishing Houseand’s publications are on interfaith and intercultural studies and it is also the publisher of a series of popular exam preparation books. Kaynak Holdingand’s bimonthly Hira Arabic magazine is published in Turkey, Egypt and Morocco and has a circulation of over 90,000.
In remarks to Todayand’s Zaman on Wednesday, a professor of law who wished to remain anonymous said that property rights in Turkey were under serious threat. and”This is not the first [government takeover of a private company], nor will it be the last. [The appointment of trustees] to Koza ipek Holding was a previous example. [Turkey] is on a dangerous course,and” the professor said.
The move to seize the company came only three weeks after trustees were appointed to Koza ipek Holding and its subsidiary companies. Police teams entered Koza ipekand’s headquarters in Ankara and the ipek Media Groupand’s offices — which house four media outlets owned by the holding — in Istanbul on Oct. 27. The authority for the move came from a widely criticized court decision to appoint a board of trustees to take over the management of the holdingand’s 22 companies. Dozens of people were fired, television stations belonging to the ipek Media Group were closed and the sales of the Bugandun and Millet dailies significantly decreased following the appointment of the trustees.
Center for Legal, Ethical and Political Studies (HESA) Director Ramazan Tai said in a statement on Wednesday that Kaynakand’s takeover threatens foreign investment in Turkey because it erodes investorsand’ confidence in the rule of law. and”The arbitrary appointment of trustees based on reasonable suspicion, which has turned into arbitrary extortion and undermines investment in Turkey, should be immediately abandoned. andhellip It endangers the future of Turkey,and” Tai said.
h2andlsquoECtHR will overturn decision to take over Kaynakand’h2 Dogan Cansizlar, the former head of the Capital Markets Board (SPK), told Todayand’s Zaman on Wednesday that the appointment of trustees to Kaynak Holding based on and”reasonable suspicionand” that the holding was involved in wrongdoing would not be upheld if the case was appealed to the European Court of Human Rights (ECtHR).
and”The move can be justified by pretexts pertaining to reasonable suspicion and appear to be in line with domestic law, but it will be overturned by the ECtHR. Such a practice can lead to questions over property rights, the right to free enterprise and the free market,and” Cansizlar said.
He went on to say that the government should be wary of scaring foreign investors by failing to uphold property rights and the right to free enterprise at a time when the country is in need of foreign capital. and”We need $180-190 billion of capital in the next 12 months. We need foreign cash and investments. Foreign investors will not come if there are questions over property rights and the right to free enterprise,and” Cansizlar said.
h2andlsquoStrict conditions should be met before appointing trusteesand’h2 In an interview with the andOzgandur Danduiandunce daily on Tuesday, former Justice Minister Tandurk said that the appointment of trustees to companies without proper legal justifications is destroying trust in the judiciary in Turkey.
and”This has no place in the law this is extortion. Trustees should be appointed if the executive board [of a company] no longer functions and its assets need management,and” Tandurk said.
The Istanbul 10th Criminal Court of Justice justified its decision to appoint trustees to Kaynak Holding by reference to a possible affiliation of the holding with Turkish Islamic scholar Fethullah Gandulen, who is in a self-imposed exile in the United States.
In an indictment prepared by Public Prosecutor Hasan Yilmaz, Gandulen has been accused of being the leader of a terrorist group that allegedly sought to overthrow the government in 2013 via a series of graft probes implicating top government officials. There is still not a court ruling proving Gandulenand’s guilt.
In a column in the Zaman daily on Wednesday, former Supreme Court of Appeals President Sami Selandcuk said that the appointment of trustees to companies should be subject to strict criteria.
Selandcuk said that trustees can be appointed only if there is strong evidence indicating that a companyand’s board is collectively involved in crimes, according to Articles 188, 314 and 315 of the TCK, which concern the production and trade of drugs and herbs used in drugs and the supply of weapons to armed groups.

SOURCE: TODAY’S ZAMAN

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