Article 46/B – A decision may be made by the Board for the gradual liquidation of intermediary institutions, the authorities of which have been removed in accordance with subparagraph (h) of the first paragraph of Article 46 of this Law. The liquidation operations of these institutions shall be carried out by the Investors' Protection Fund.

            The objective of gradual liquidation is to liquidate the cash payments and the delivery obligations of capital market instruments to the customers due to the capital market operations carried out in the framework of the Law by setting aside the amount obtained by transforming the assets to in kind or cash according to their attributes. In the decision and operations of gradual liquidation, the provisions related to liquidation in the Turkish Commercial Code, the Execution and Bankruptcy Law and the other legislation shall not be applied. The principles and method of application for gradual liquidation of intermediary institutions shall be set forth in a regulation promulgated by the Board.

         After a decision is made for gradual liquidation, the duties and authorities of the legal organs of the intermediary institutions shall be carried out by the Fund until the liquidation is concluded.

         A decision may be made by the Board to transfer to another institution the management of portfolios that are managed by an intermediary institution, including mutual funds and investment company portfolios. However, the provisions of subparagraph (h) of the first paragraph of Article 46 is reserved.

         Payments by the intermediary institution for which a gradual liquidation decision is made shall be stopped and as of the date of this decision all its assets may be used only by the Fund. The Fund shall determine the assets and liabilities of the intermediary institution. The cash debts in the scope of the obligations that should be liquidated shall be calculated over the total principal capital and accrued interests at the date of the decision of gradual liquidation; with respect to the obligation to deliver capital market instruments, in cases where it cannot be delivered in kind, the debt shall be calculated based on the market value on the date the delivery went into default otherwise  the day that the decision is made for gradual liquidation. The rights and obligations arising from contracts with maturity dates after the date of the decision for the gradual liquidation of the intermediary institution shall be  determined as of their maturity dates. Legal default interest shall be applied at the rate envisioned in the third paragraph of Article 2 of Law No. 3095 Related to Legal Interest and Default Interest as of the maturity date of term debts and as of the date of the gradual liquidation decision for the other debts. In accordance with the legislation, guarantees given by the intermediary institution are also taken into consideration in the assets account.

         The Fund shall determine the real holders of rights and the amounts of their receivables which are in the scope of liquidation of the intermediary institution based on the records kept by the Board, the records of the intermediary institution, the records of other official and private institutions related to these organizations and other reliable information and documents. In case there is the existence of the conditions described in Articles 278, 279 and 280 of the Execution and Bankruptcy Law, an annulment lawsuit may be opened by the Fund.

         For the intermediary institutions which are not subject to gradual liquidation but for which a decision of bankruptcy has been made, payment shall be made from the Fund, with the approval of the Fund management, to the creditors for cash and shares arising from the share transactions on the list by considering the amounts owed which appear on this list. In accordance with the related legislation, the banks for which operations are stopped, in accordance with the related legislation of the bank management, the real holders of rights and the amount owed for cash and shares arising from share transactions are determined by the organization that takes over and, with the approval of the Fund administration, it is taken as the basis for the payments that shall be made from the Fund. For payments that shall be made in accordance with this paragraph, the principles for making payments to the creditors of intermediary institutions subject to gradual liquidation shall be applied.

         At the beginning of the gradual liquidation, first of all the capital market instruments shall be distributed to the holders of the rights in the customer settlement accounts. With this objective, the capital market instruments that are settled in the customer account are compared as of the separate accounts and shall be used only for meeting the obligations to these account holders.

         For the holders of settlement accounts who have enough to meet what is owed in the account or who do not have any shares, a total of seven billion five hundred million TL of their cash and share receivables shall be paid by the Fund without waiting for the conclusion of the liquidation. However, for those who appear to be creditors of the same institution in the opinion of the Fund who have acted together with the institution, payment is made in the proportion to their receivables provided that it does not exceed the above total. Advance payments shall not be made from the Fund to shareholders, members of the board of directors or board of auditors, personnel authorized to sign and their spouses, blood relatives and relatives by marriage including the third degree, who appear to be debtors of the intermediary institution subject to gradual liquidation. The total payment that shall be made in accordance with this paragraph shall be increased at the rate of the revaluation coefficient that is announced every year.

         The Fund, after making the advance payments, shall continue the gradual liquidation of the intermediary institution. The liquidation balance of the receivables from the holders of the rights in the scope of the objective of the liquidation shall be used for the payment of the receivables which are not completely met. However, if the liquidation balance is not sufficient to meet all of these receivables, then payments shall be made by pro rata distribution. After all of these receivables are met, then from the remaining portion, first of all the public receivables and from the remaining amount, the receivables arising from the advances made by the Fund and the liquidation expenses shall be paid. The balance is distributed to the other creditors. If the assets of the intermediary institution are not sufficient to meet the receivables of the holders of rights in the scope of the objective of liquidation, the payments made from the Fund and the liquidation expenses, then the Fund, with the concurrence of the Board, may request the bankruptcy of the intermediary institution.

         The gradual liquidation of capital market institutions other than intermediary institutions shall be undertaken by the Board and, other than the provisions related to the Investors' Protection Fund, this article shall be applied for them. The methods of gradual liquidation of the institutions in the scope of this paragraph shall be determined by the Board by taking into account their types.