A pledge over a commercial enterprise within the perspective of the law on chattel mortgage in commercial transaction

The pledge, a kind of collateral security, has been virtually regulated under the Law of Property Book of the Turkish Civil Code (TCC). It can be claimed that the main principle in mortgaging the chattel is that it is carried out by transferring actual possession. (TCC Art. 939/1) However, due to the specific requirements of commercial life, the Law of a Pledge Over a Commercial Enterprise numbered 1447, which was enacted on 21/7/1971 (former law), had an exception on the chattel mortgage and in order to establish the pledge it had not required transferring the chattel that was a subject of a pledge. As a matter of fact that the lawmaker, who acts with similar thoughts in terms of not to search for transferring the chattel that is a subject of a pledge, has enacted the Law on Chattel Mortgage in Commercial Transaction (CMCT) numbered 6750 on 20/10/2016 and has put in force on 01/01/2017 in order to contribute the financial needs of small and medium-sized enterprises (SMEs) and to meet with the current needs of the financial markets. Thus, the old Law of a Pledge Over a Commercial Enterprise numbered 1447 was abolished. In this study, a pledge over commercial enterprise will be evaluated within the light of the new changes on the Law numbered 7099 (O.G. 10.05.2018/30356) and the By-Law that is published on the Official Gazette (22.05.2018/30428). In addition, the Law on Chattel Mortgage in Commercial Transaction, as distinct from the former the Law of a Pledge Over a Commercial Enterprise numbered 1447, does not only regulate a pledge over commercial enterprise. As a matter of fact, there are a few special regulations about the pledge over commercial enterprise in the Law on Chattel Mortgage in Commercial Transaction (Article 5). In this respect, the Law on Chattel Mortgage in Commercial Transaction and the other regulations in the secondary legislations can be only implemented on the pledge over commercial enterprise, where it is appropriate. Therefore in this work, the establishment, scope, contractual provisions and the end of a pledge over commercial enterprise will be analysed within the framework of the Law on Chattel Mortgage in Commercial Transaction and the secondary legislations and the possible problems that may arise in practice will be examined in details. Keywords: The Law on Chattel Mortgage in Commercial Transaction, a Pledge Over a Commercial Transaction, the Chattel Mortgage Registry