Turkey Added to Global Financial Watchdog’s Grey List
ABD Yolsuzlukla Mücadele Stratejisi: Uluslararası Yolsuzluğa Sıfır Tolerans!
Turkey & Anti-Bribery Compliance
A historical comparative legislation analysis
Transparency International published its 2020 Corruption Perceptions Index (“CPI”) on January 28. According to the CPI results, Turkey scored 40 points out of 100, and ranked 86th out of 180 countries.
The CPI is a worldwide study by Transparency International (“TI”), a well-known global organization that fights corruption. Its report is released annually and aims to provide a comparative assessment of worldwide levels of corruption by reflecting the observations of how corrupt a country’s public sector is perceived to be by experts in non-governmental organizations. TI has scored and ranked countries’ perceived levels of corruption in the public sector through its CPI report since 1995.
The CPI scores 180 countries on a scale of zero to 100, ranging from high to low corruption, respectively. The study is conducted through data collected from 13 different surveys, and assessments from several international organizations. For a country to be included in the ranking, it must be included in a minimum of three of the CPI’s data sources.
When compared with the results from 2019, Turkey’s score increased by one point from 39 to 40, improving its ranking from 91st to 86th. When generally considering its progress from 2012 to 2020, however, Turkey has been one of the countries that has shown a dramatic decrease in the CPI. Turkey is assessed under the Eastern Europe and Central Asia region, which has become the second-lowest performing region on the CPI and vulnerable to corruption, which has been compounded by COVID-19.
When considering Turkey from a wider perspective, it is fair to say that Turkey presents a respectable stance and is supportive of efforts against corruption by being a party to, and a member of many conventions and organizations in the global arena. Turkey’s commitment to the fight against corruption and the steps it has taken through legislative reforms has undoubtedly played a role in the one-point increase in its score. However, there are still several shortcomings in complying with international obligations and weaknesses both in legislation and enforcement for anti-corruption that cause Turkey’s CPI score to be lower than some EMEA countries.
There is no specific intra or extra-territorial legislation for anti-corruption and/or anti-bribery such as the FCPA or Bribery Act in Turkey. The legal framework for anti-corruption is weak in the private sector, and there are various legal gaps that do not meet with the standards provided in international conventions, including the definition and scope of bribery. Bribery, extortion, misconduct, abuse of trust, fraud, forgery of documents and bid rigging are regulated under the Turkish Penal Code, and anti-money laundering is regulated under the Law on the Prevention of Laundering of Crime Revenues. However, the definition of bribery requires the person who requests or takes a bribe to be a public officer. The scope of the crime does not cover private sector-to-private sector bribery, although some entities are excluded, such as public joint stock companies’ representatives.
In Turkish law, legal entities are not directly held liable for their involvement in criminal activities. However, Turkey has recently made some legislative improvements regarding legal entities’ corporate liability deriving from criminal liability. Following the amendments made to Article 43/A of the Misdemeanours Law, legal entities may be subject to administrative penalty fines of up to TRY 50,000,000 before the conclusion of a criminal investigation or prosecution of real persons who have committed crimes including fraud, bribery, bid rigging and money laundering for the benefit of the legal entity in question. The same amendment also states that an administrative fine cannot be less than the twice the monetary gain of a criminal activity. These improvements are also expected to be supported by enforcement.
Even though there is no specific body or legislation established for anti-corruption, the previous inconsistency in enforcing existing laws must be remarked upon. Even the strongest laws are not intimidating if they are not enforced consistently through proportional punishments.
One factor that might affected the CPI score, might be the ongoing criticisms that Turkey’s investigation, prosecution, and conviction track record remains poor when compared with the number of reported corruption cases that have gained press attention.
There is no permanent, independent anti-corruption body established in Turkey. There are also no specialized prosecution services established to lead corporate/public specific corruption investigations, nor any courts specifically working on anti-corruption lawsuits.
The main concerns about fundamental rights focus on the rule of law, the right to fair trial, freedom of expression and freedom of assembly and association. The rule of law, respect for human rights and an independent judicial system are fundamental elements of anti-corruption practices. Even though the legal framework in Turkey includes the guarantee of fundamental human rights, the implementation must also align with recommended international standards.
Another factor that might affected the TPI score could be, ongoing concerns about the political pressure on judges and prosecutors. The need for transparency in the appointment and dismissal of judges and prosecutors, as well as academicians and many other public officers.
In Turkish law, there is no specific anti-bribery legislative framework to provide whistle-blower mechanism in public and private sector, that involves non-retaliation, or to preserve a whistle-blower’s anonymity. Tips from whistle-blowers are the backbone of detecting and investigating corruption. In the ACFE’s 2020 “Global Study on Occupational Fraud and Abuse”, which also includes thirteen misconduct cases from Turkey in its examinations, it was demonstrated that the most efficient way of detecting misconduct is whistle-blowing, with its rate corresponding to 43% of cases. The legal framework for whistle-blower protection needs to be aligned with the global extra-territorial anti-corruption regulations. It could be argued that the lack of effective whistle-blower mechanisms effects the CPI score since it’s correlation with transparency and fighting with corruption.
Turkey makes strong commitments and takes concrete actions in legislative and executive areas to improve and implement its anti-corruption strategies. The Judicial Reform Strategy for 2019-2023 states “protection and improvement of rights and freedoms, improving judicial independence, impartiality and transparency, ensuring access to justice, enhancing the efficiency of the criminal justice system, improving the efficiency of civil and administrative trials” as the main aim and focus of Turkey’s upcoming reforms.
The CPI draws a map of corruption risks for foreign investors and initiatives. The existence of adequate legislation and independent bodies for anti-corruption in both the public and private sector, consistent enforcement and intimidating punishment, transparency in decision-making authorities, freedom of expression and whistle-blowing protection are all considered fundamental elements in assessing a country’s CPI.
Besides its industrial and economic growth and development, Turkey intends to protect its charm for foreign investment. Therefore, it is expected that Turkey will present a consistent stance against anti-corruption and take concrete actions to effectively implement its international obligations to fight corruption, and hence increase its CPI score. Within this scope, new regulations to prevent corruption in the private sector, and the improvement and implementation of entities’ compliance obligations and liability reforms are expected. It is, therefore, recommended that companies operating in Turkey follows new regulatory developments as well as implement highest ethical standards to foster their compliance programs and anti-corruption policies in accordance with their local and international risks.
 Professional organisations with public institution status, companies established with public participation and foundations operating within them, public benefit associations, and only cooperatives and public joint stock companies are included in the scope of bribery in terms of the private sector
 The Law on the Prevention of Financing of Mass Destruction Weapons numbered 7262/19 dated 27.12.2020
 Association of Certified Fraud Examiners