Turkey Introduces KYC Requirements for Independent Attorneys

The Grand National Assembly of Turkey has approved a law proposal that introduces significant amendments to the Law No. 5549 on Prevention of Laundering of Crime Revenues, including the introduction of Know Your Client (KYC) requirements for independent attorneys.

New Obligations for Independent Attorneys

As of this new amendment, independent attorneys will be considered as “obliged parties” and will be required to conduct KYC checks before transactions in certain circumstances. These include:

• Purchases and sales of real estate
• Establishment and abolition of limited real rights
• Incorporation, merger, management, assignment, and liquidation of companies, foundations, and associations
• Financial transactions related to these activities

Scope Exclusions

The scope excludes information obtained through judicial procedures and professional studies conducted within the framework of alternative dispute resolution methods. Additionally, independent attorneys will be required to identify clients’ identities for permanent business relationships, in cases that require suspicious transaction reporting or if there is a suspicion on the accuracy or sufficiency of previously obtained customer information.

Reporting Suspicious Activities

Independent attorneys will also be obliged to report suspicious activities to the Financial Crimes Investigation Board (MASAK). A suspicious transaction is defined as any activity where there is reasonable grounds to suspect that an asset has been acquired through illegal means or used for illegal purposes, including:

• Terrorist activities or by terrorist organizations
• Terrorists or those who finance terrorism

KYC Information Requirements

The information obtained for KYC and verification of such information will vary depending on the person concerned. For instance:

• Real persons will be required to provide:
  • Name
  • Surname
  • Birth place and date
  • Parents’ name
  • Nationality
  • Turkish ID number
  • Identity certificate type and number
• Legal entities will be required to provide:
  • Trade name
  • Trade registry number
  • Field of activity
  • Company address
  • Contact information
  • Authorized representative’s name, surname, place and date of birth, parents’ name, nationality, Turkish ID number, and identity certificate type and number

Document Retention and Disclosure

Independent attorneys must keep documents on customer identification for eight years from the last transaction date and provide these documents upon request of the authorized bodies. Failure to comply with these obligations may result in administrative fines of up to 50,000 Turkish Liras.

Aim of the Amendment

The new amendment aims to strengthen Turkey’s anti-money laundering and combating terrorist financing regulations and ensure greater transparency in financial transactions.