February 9, 2015

Removing the barrier on the way to an autocratic state

Sami Karahan*

The whole Bank Asya operation is just the continuation of plans that started in 2006. These are plans that aim to make Justice and Development Party (AKP) rule permanent and have led to the creation of pro-government capital and big business, as well as the silencing of the opposition.

Pro-government media outlets have been filled with stories that aim to present good reasons for the seizure of Bank Asya and other large companies. And in fact this seizure has taken place in clear violation of the Banking Law, the Capital Market Law and the Trade Law. But more than representing some simple desire or reflex, this seeming “urge to take over” is imbued with much deeper meaning. As I see it, the ruling party in Ankara views Bank Asya and its mission as being one of the greatest barriers that stand before it, which is why it counts any method attempting to eliminate this bank as being legitimate.

It also now appears that both the Banking Regulation and Supervision Agency (BDDK) and the Savings Deposit Insurance Fund (TMSF) have undertaken new duties when it comes to Bank Asya. Employing Article 18 of the Banking Law -- which up until now had never been used -- members of the bank's board have been dismissed and replaced by pro-government figures. And in the meantime, 63 percent of the bank's shareholders have simply had their rights taken away, with the exception of bonus profits.

The main reason for this latest operation was presented as the lack of transparency in the workings of Bank Asya, the claim being that certain necessary documents that those in possession of privileged shareholder stakes should get every year were not in fact given. But just as this reason lacks any real meaning, the actions against the bank are also illegal. To wit, gaining the approval of the BDDK in order to turn over qualitative shares in this bank was an absolute precondition. For around the last 16 months, the BDDK has not approved of takeover functions involving shareholders. So there were no changes in the structure of the bank management and hence no changes in the bank's documents that had been released at the beginning of 2014. Not only this, but most of the documents being demanded were simply being asked for with the aim of creating more bureaucratic difficulties.

They were not actually documents that were necessary for banking activities, nor were they important enough for their absence to require any changes at all in the directorship of the bank.

The legal aspects surrounding the Bank Asya situation are of international significance, as is the deadlock that it represents now in Turkey. We can foresee that there will be two critical results that emerge from this situation.

The first concerns the economic dimensions of this business. If the Bank Asya case carries over to the European Court of Human Rights (ECtHR), it is quite possible that Turkey could be hit with orders to pay astronomical sums in compensation. When one considers that in the past, in similar situations, Turkey was ordered to pay $4.5 billion in damages, or that Russia was ordered to pay $50 billion in damages in the Yukos case, it becomes clear that something along these lines might well happen this time around.

So it is Turkey's overseas possessions as well as Turkish Airlines planes that will stand as the main collateral assets when it comes to these damages. There will also likely be trials in Turkish courts of law of the public officials involved in this criminal operation.

The second result of all of this is actually more important than the first mentioned above. It appears that the reason driving the operation against Bank Asya is the bank's links to the Gülen movement. Despite the efforts under way for more than a year now to create the impression of a parallel structure in Turkey, not only has nothing been proven, but there is not even any evidence inside or outside of Turkey, which makes this bank operation -- carried out against people who have not been shown to be in any way criminal or to have ties to any criminal organization -- a hate crime in light of international law. In fact, the bylaws of the Organization for Security and Cooperation in Europe (OSCE) are very clear on this, which means that those carrying out this kind of crime need to be tried in the International Court of Justice (ICJ) in The Hague.

As far as I can see, if things continue the way they are now in Turkey, it should come as no surprise when certain Turkish officials are tried and convicted in this court of law.

The economic threat is growing

The ruling party's operations aimed at using state power to seize big business interests are not yet over. After all, they have not yet grabbed up all the above- and below-ground resources, taken over all of the free plots of land, quieted all the voices of opposition, cut down all the trees or built all the enormous shopping centers and residences. It also does not appear likely that those in power will feel even the slightest sense of remorse or repentance for their actions, which means the efforts under way to complete a fully autocratic state will only continue.

Using the Bank Asya situation to scare other banks and large companies is another result of the human relations aspect of this. In other words, large business bosses are being told: “Either you are with us and you will do as we say, or we will destroy you. And in the process, we will seize your possessions, your companies, your licenses and your mines.”

At the same time, there is a carefully orchestrated attempt under way to present the appearance that the executive, legislative and judicial branches of government are working together on all of this. But in the face of the Bank Asya operation, what we see is that thousands of democrats -- from every walk of life and every belief -- perceive correctly that this is not just a situation that concerns the Gülen group. Seeing that these actions threaten freedom and ultimately democracy, they have stood up to back the bank, and in doing so, have ruined the plans of the ruling political party. And, of course, the chorus of disapproval from international financial circles and other actors has also wound up being an important factor in all of this.

*Sami Karahan is a professor at Marmara University's faculty of law.

Published on Today's Zaman, 09 February 2015, Monday

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