ANNUAL INCREASE RATES AS OF JANUARY 2021

As you are aware, as per the mandatory Article 344 of the Turkish Code of Obligations, , the rent increase of the business premises is also limited by the consumer price index (hereinafter referred to as “CPI”) (in Turkish, “TÜFE”) as the rent increase of the residence premises (since 1 July 2012). In accordance with the aforementioned article, the agreements of the parties regarding the rent increase to be applied in the renewed lease periods are valid provided that it does not exceed the annual CPI of the previous lease year. Even if a higher rate is stipulated in the lease contract, the limit will be directly applied, thus, the rate of increase will not exceed the CPI. In the light of this, we hereby inform you that,the increase in rent agreements will be based on the 12-month average rate of increase in CPI as released by Turkey Statistical Institute (“TÜİK”)

Besides, as mentioned in our Newsletter of 30 December 2020, we also kindly remind you that, as per the Minimum Wage Determination Commission’s Decision dated 28 December 2020 and numbered 2020/1, published in the Official Gazette dated 30 December 2020 and numbered 31350, it has been announced that the minimum wage in Turkey has been increased by 21.56% as of 1 January 2021.

In this respect, your company may kindly take into consideration these rates while determining the annual increase of the business place’s rents or the annual increase of the salaries of the company’s employees, as well as maintaining the above as a reference for the company’s suppliers.

Our Law Firm remains at your disposal for any further clarifications you may need.