1. Recent regulatory changes adopted by the Capital Markets Board ("CMB") are summarized below:

    1. Clarification on Disclosure of Control Changes in Publicly Listed Companies
      Communiqué on Material Events No. II-15.1 ("Communiqué No. II-15.1") is amended by the Communiqué No. II-15.1.c on November 17, 2018. The main change sets forth that any acquisition or sale that results in exceeding or falling below the thresholds of 5, 10, 15, 20, 25, 33, 50, 67 and 95% i) directly in the shareholding or voting rights of a publicly traded company shall only be disclosed to public by Merkezi Kayıt Kuruluşu A.Ş. ("CRA", Central Registry Agency), and ii) any of the indirect change in the shareholding or voting rights or any changes in the shareholding or voting rights of a publicly traded company occurred as a result of shareholders acting in concert with other real person/legal entity, shall be disclosed by the shareholders or the real person/legal entity such shareholder acts in concert with.
    2. New Rules for Trade Reporting and Introduction of MKK as Trade Repository
      CMB published a new Communiqué on Principles regarding Reports to be made to Trade Repositories No. IV-87.1 on 27 October 2018. This Communiqué mainly regulates procedures and principles regarding the notifications to be made to the trade repositories through electronic data storage system ("e-Vedo") by legal entities including investment organizations, portfolio management companies, central counterparty and other financial institutions in relation to information on derivative transactions in organized and over-the-counter markets including the related parties to such contracts and the underlying assets.Trade repository is responsible to centrally collect and maintain the records of derivatives. CMB authorized MKK as the trade repository. E-Vedo platform is in effect since 30 November 2018 and should be noted that, the responsible entities are required to report the related information before the expiry of 1 January 2019.
    3. Amendments reflected to Guideline on Pension Funds
      CMB Bulletin dated 6 December 2018, brought certain novelties and amendments on the Guideline on Pension Funds. The major changes are i) the principles of standard funds are amended and automatic enrollment standard (AES) and initial pension funds are introduced as new types of pension funds and each of their principles are set forth in the Guideline on Pension Funds and ii) funds which are composed of participation banking assets are required to include the term "participation" in their title.
    4. Capital Market Instruments with Repurchase Commitment in Portfolio of Investment Funds and Pension Funds
      In the CMB Bulletin dated 13 December 2018, CMB allows the pension funds and investment funds to sell the capital market instruments issued with repurchase commitment of which is given by the issuer itself or third parties and which are existing in their portfolios on off-exchange basis subject to the fund's reasoned board of directors' decision.
    5. Underlying Assets of Asset-Backed and Mortgage-Backed Securities Diversified
      On 11 December 2018, (i) Communiqué No III-58.1a which amended the Communiqué on Asset-Backed and Mortgage-Backed Securities No III-58.1 and (ii) Communiqué No III-59.1c which amended the Communiqué on Covered Bonds No III-59.1 have been published in the Official Gazette. With the amendment of these two Communiqués, CMB aimed to diversify the types of assets linked to the asset-backed and mortgage-backed securities. A large set of tools, including covered bonds also became acceptable as the underlying asset of asset-backed and mortgage-backed securities. CMB further intends with these amendments to provide convenience for financial institutions to provide funds by securitizing their liquidity constrained assets. CMB announced that in accordance with these intents, the asset-backed securities, mortgage-backed securities and covered bonds shall not be subject to board fees until 31 December 2019.
  2. Borsa Istanbul A.Ş. (Istanbul Stock Exchange, "BIST") has recently made the following announcements in various topics:

    1. On 10 December 2018, BIST announced the revised BIST Share Indices Ground Rules.
    2. On 10 December 2018, BIST also made an announcement in the PDP that quotation fee shall not be charged for asset-backed securities, mortgage-backed securities and covered bonds until 31 December 2019.
    3. On 12 December 2018, BIST announced the revised BIST Futures and Options Market ("VIOP") Operation Procedures and Principles.
    4. On 13 December 2018, BIST announced the future contracts with the new underlying assets (e.g. ASELS, BIMAS shares, XBANK share indices and GBPUSD exchange rate) that started to be traded in VIOP as of 14 December 2018.
    5. On 17 December 2018, BIST announced the revised Directive on Debt Securities Market.
  3. Turkish Capital Markets Association ("TCMA") issued a new Circular numbered 41 and dated 7 December 2018, which has amended the "Directive on the Provisions to be Reserved for Investment Funds" and came into force as of 7 December 2018. It shall be noted that TCMA, in order to avoid any different treatments in the market, with this amendment, aims to determine the reserve amounts to be maintained by the investment funds for the debt securities and lease certificates in their portfolio in case the issuer of any of the foregoing falls into default and fails to satisfy its obligations.

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