The BRSA has published the Draft Regulation Amending the Regulation on Debit Cards and Credit Cards. The following amendments have been made within the scope of the Regulation:
ARTICLE 1 – The following subparagraph has been added to Article 4 of the Regulation on Debit Cards and Credit Cards, published in the Official Gazette dated 10/3/2007 and numbered 26458.
(n) Card scheme: The entirety of the rules, practices, guidelines, and standards that enable card payment transactions to be carried out, including the management and decision-making bodies and organizational structure responsible for running it, independently of the infrastructure and payment system that supports the operation of a card system institution,”
ARTICLE 2 – In the second paragraph of Article 11 of the same Regulation, the phrase “the activity of entering into agreements with,” has been changed to “the activity of authorizing to enter into agreements with,”, and in the fourth paragraph of the same article, the phrase “Establishing a card system, issuing cards, entering into agreements with merchants,” has been changed to “With card institutions”.
ARTICLE 3 – The following paragraphs have been added to Article 21 of the same Regulation. “(6) Card issuers cannot issue the cards they make available to their customers for domestic use with only the card scheme of a card system institution that has not obtained an operating permit in Turkey in accordance with this Regulation. The card scheme of a card system institution that has not obtained an operating permit in Turkey may be defined on a card to be used domestically only if the card scheme of a card system institution that has obtained an operating permit in Turkey is also defined on that card. If a card scheme brand is displayed on the card, all card scheme brands defined on the card must be displayed. A transaction carried out through the POS of an institution that has obtained an operating permit in Turkey as an acquirer is deemed to be use of the card domestically.” “(7) Without prejudice to the provisions of the sixth paragraph, card issuers are obliged to offer the customer, at the time of the card application, a choice as to which card system institution's card scheme the card will be issued with, including the card scheme brands of card system institutions headquartered abroad that open a branch or representative office in Turkey, to comply with this choice, and to inform the customer clearly and objectively about the functions, costs, customer rights, and security features of all card scheme options, including the domestic and international use of the card. In applying this right of choice, without prejudice to the provisions of the sixth paragraph, the customer cannot be forced to choose more than one card scheme brand at the same time, and if the customer chooses to use more than one card scheme at the same time before the card is issued, the customer must be able to determine which scheme will be applied to the card as a priority. If the customer requests a change of the priority card scheme, the card issuer must fulfill this request within fifteen days at the latest.” “(8) Where merchants resident abroad carry out activities directed at persons resident in Turkey, card issuers may approve transaction authorization requests coming through the POS devices allocated to such merchants resident abroad only if those requests come through the POS of an institution that has obtained an operating permit in Turkey as an acquirer. Any of the following is sufficient for the activities of merchants resident abroad to be deemed directed at persons resident in Turkey: opening a place of business in Turkey, creating a Turkish-language website, or carrying out promotion and marketing activities for the goods and services offered, directly and/or through persons or institutions resident in Turkey. The Board is authorized to determine additional criteria for establishing that activities are directed at persons resident in Turkey, as well as the procedures and principles for applying this paragraph.”
ARTICLE 4 – The following paragraph has been added to Article 27/A of the same Regulation. “(10) Acquirers are obliged to ensure that the card schemes of all card system institutions that have obtained an operating permit in Turkey are defined on the POS devices they make available to merchants; where more than one card system institution's card scheme is defined on the accepted card and all of these card schemes are also defined on the POS, to automatically apply the priority card scheme preferred by the cardholder pursuant to the seventh paragraph of Article 21, unless the cardholder states otherwise; and, if the cardholder makes a different choice, to apply the other card schemes defined on the card in accordance with the cardholder's choice.”
ARTICLE 5 – The following provisional article has been added to the same Regulation. “PROVISIONAL ARTICLE 3 – Cards issued by card issuers before the date on which this article enters into force are exempt from the provisions of the sixth and seventh paragraphs of Article 21 of this Regulation. If such cards are renewed after the date on which this article enters into force, this exemption does not apply.”
ARTICLE 6 – This Regulation enters into force three months after its publication date.
ARTICLE 7 – The provisions of this Regulation are executed by the President of the Banking Regulation and Supervision Agency. DRAFT REGULATION AMENDING THE REGULATION ON DEBIT CARDS AND CREDIT CARDS GENERAL RATIONALE As is known, Article 3 of Law No. 5464 on Debit Cards and Credit Cards (the Law) defines card system institutions as “institutions that establish a debit card or credit card system and authorize the issuance of cards or the conclusion of merchant agreements under this system”, and pursuant to Article 4 of the Law, institutions that wish to establish a card system, issue cards, enter into agreements with merchants, and exchange information must obtain permission from the Banking Regulation and Supervision Board (the Board). In this context, certain amendments are envisaged to the Regulation on Debit Cards and Credit Cards (the Regulation) in order to encourage card system institutions to obtain an operating permit, to ensure the expansion of card system institutions operating or to operate in our country with an operating permit, thereby increasing service diversity and developing the card payments ecosystem. Within this framework, the following amendments are to be made to the Regulation: – Correcting expressions in the Regulation that may lead to misunderstandings, taking into account the definition of card system institution; – Taking into account international practices on the use of the card schemes of two or more card system institutions and the relevant provisions of European Union Regulation 2015/751, ensuring that the card schemes of card system institutions that have not obtained an operating permit in Turkey do not appear alone on cards to be used in domestic transactions, thereby encouraging the relevant card system institutions to obtain an operating permit so that a card scheme brand can appear alone on cards issued for domestic use, and introducing an obligation to offer customers a choice, at the time of the card application, as to which card scheme brand the card will be issued with; – In order to ensure compliance with these amendments, regarding technical infrastructure, introducing an obligation for acquirers to ensure that the card schemes of card system institutions that have obtained an operating permit in Turkey are defined on the POS devices at merchants that accept cards to be used domestically; and also adding a provisional article to the Regulation to ensure that existing cards can continue to be used without being affected by these amendments and to clarify that these amendments apply to cards renewed after their effective date.
You can review the Draft Regulation Amending the Regulation on Debit Cards and Credit Cards at the link below:
