Short Selling, Margin Trading and Securities Lending in Turkey: Communiqué Serial V No. 65, Capital Markets Law Arts. 39, 46 and 101, Takasbank’s Lending Market and SPK Short-Selling Bans

Short selling, margin trading and securities lending on Borsa Istanbul are governed mainly by Communiqué Serial V No. 65 on Margin Purchases, Short Sales and Lending and Borrowing of Capital Market Instruments. The Communiqué dates from 2003, was last amended in 2021 and continues to apply under Capital Markets Law No. 6362 (Provisional Art. 1). The Law authorises SPK to set the rules (Art. 39(7)), protects collateral from creditors (Art. 46(4)) and allows SPK to restrict margin purchases, short sales and lending in market abuse investigations (Art. 101(1)(c)). Market-wide bans have been imposed under SPK’s general power in Art. 128(1)(a). The most recent ban covered the Borsa Istanbul equity markets from 2 March 2026 to the end of the session on 26 June 2026. Since 17 September 2026, SPK has again allowed brokers to apply a 20% instead of a 35% maintenance ratio to margin loans, currently until the end of the session on 30 October 2026. A short seller must put up at least 50% initial equity and maintain 35% (Communiqué Art. 25). Short-sale orders must be flagged (Art. 28), an uptick rule applies on the Main Market (Equity Market Directive Art. 39), and directors, senior staff and holders of 10% or more may not sell their company’s securities short (Art. 30). A borrower of securities must provide collateral worth at least 100% of their value (Art. 33). On Takasbank’s Securities Lending Market, Takasbank acts as central counterparty, and lenders keep dividends and subscription rights but lose voting rights while their shares are on loan. This guide explains the rules for foreign institutional investors. It reflects the legislation and SPK announcements as at 26 October 2026.

Why these rules matter to institutional investors

Large institutional investors are rarely short sellers in Turkish equities, but many of them lend securities. Shares held for the long term are made available, directly or through custodians and agent lenders, to brokers and market participants who need them to settle short sales or cover delivery failures. In Turkey, such loans are made either bilaterally under Communiqué Serial V No. 65 or through the Securities Lending Market operated by Takasbank. The legal terms of those loans determine whether the lender can recall the shares in time to vote, how dividends are compensated, what collateral protects the lender and what happens if the borrower defaults.

The same rules matter in periods of market stress. In 2023, 2025 and 2026, SPK banned short selling on Borsa Istanbul equity markets and relaxed the margin maintenance ratio for credit-financed purchases. These measures change liquidity and price formation, the value of collateral and the behaviour of leveraged investors. In a manipulation investigation, how purchases were financed and whether short sales were used can be part of the facts SPK examines. The Capital Markets Law expressly allows SPK to restrict margin purchases, short sales and lending by persons reasonably suspected of market abuse (Art. 101(1)(c)).

This guide covers the equity markets of Borsa Istanbul and Takasbank’s Securities Lending Market. It does not deal with derivatives traded on Borsa Istanbul’s futures and options market, with repurchase agreements or with the tax treatment of lending fees and compensation payments. It sets out the rules and SPK’s published decisions. It does not assess the conduct of any broker, lender, borrower or investor.

The legal framework

The Capital Markets Law sets out the basic powers and protections. Art. 39(7) authorises SPK to set the principles for lending and short selling of capital market instruments. It also authorises SPK to regulate credit-financed transactions after obtaining the opinions of the Treasury and the Central Bank (TCMB). Art. 46(2) allows investment firms to require collateral from investors for margin purchases, lending and short sales. Art. 46(4) protects such collateral: it may not be used for any purpose other than that for which it was deposited, transferred to third parties, attached even for public debts, pledged, included in a bankruptcy estate or made subject to interim injunctions.

The detailed rules are in Communiqué Serial V No. 65, published in the Official Gazette of 14 July 2003 (No. 25168) and in force since 1 January 2004. It was amended nine times, most recently by Communiqué Serial V No. 137 (Official Gazette 5 March 2021). The Communiqué was issued under the former Capital Markets Law No. 2499 and still refers to the Istanbul Stock Exchange and the Treasury Undersecretariat. It remains applicable because Provisional Art. 1(1) of Law No. 6362 provides that existing regulations continue to apply, to the extent not contrary to the new Law, until regulations under that Law enter into force. SPK continues to apply the Communiqué: its 2025 and 2026 decisions on margin trading expressly relaxed the maintenance ratio in Art. 17.

Margin purchases, short sales and loans of securities

Margin purchase. A margin purchase is a purchase of capital market instruments financed with credit under the Communiqué. The client must state when giving the order that it is a margin purchase (Art. 16(1)). If a client does not pay for an ordinary purchase by settlement, the transaction counts as a credit transaction for the purposes of the broker’s limits without further notice. Within three business days after settlement, the broker must either treat it as a margin purchase with the client’s written consent (or a new agreement), sell the securities to cover the debt where the brokerage agreement allows this, or apply the exchange’s default rules or general law (Art. 16(2)–(3)).

Short sale. A short sale is the sale of capital market instruments that the seller does not own, or the giving of an order for such a sale. Meeting the delivery obligation with borrowed instruments is also a short sale (Art. 24(1)). A seller who bought the instruments, or concluded a binding contract to acquire them, before giving the sale order is treated as owning them even if delivery has not yet been made (Art. 24(2)). If the instruments are not in the client’s account at the broker when the order is given, or if delivery is made with borrowed instruments, the order is treated as a short sale without further notice. This does not apply where the client declares that it can deliver the instruments to the broker by settlement. The client is responsible for the accuracy of that declaration, and the broker must check it, confirm it where necessary and keep the supporting documents (Art. 24(3)).

SPK’s decisions banning short selling extend the ban to positions opened and closed within the same day without using the short-sale flag (Bulletins 2025/18 and 2026/11). An intraday sale and repurchase of shares the seller did not hold is therefore treated in the same way as a flagged short sale.

Loan of securities. A lending transaction is the transfer of capital market instruments by the lender to the borrower for a fixed period, with instruments of the same kind and quantity being returned (Art. 31(1)). The borrower does not return the same shares but an equivalent number of the same kind.

Who may act. Brokers authorised to trade capital market instruments may intermediate margin purchases, short sales and lending without separate SPK permission (Art. 4(1)). Brokers, banks and Takasbank may carry out lending transactions under the Communiqué. The rules of the lending market established within Takasbank, including admission conditions and trading rules, require SPK approval (Art. 4(4)). Each broker must appoint a responsible officer and set up a credit committee chaired by a board member (Art. 5).

Which instruments. The exchange draws up lists of instruments eligible for margin purchases and short sales, taking account of market capitalisation, liquidity, shares in circulation and trading frequency. The lists are notified to SPK and announced after its approval. SPK may ask the exchange to remove instruments from the lists (Art. 6(1)–(2)). Under the Equity Market Directive, margin purchases and short sales are available on the Star Market and the Main Market but not on the Sub-Market, the Watchlist Market or the Pre-Market Trading Platform (Directive Art. 39(1)). A share moved to a lower segment therefore leaves the scope of these transactions. Instruments removed from a list stay on a temporary list for up to three months so that positions can be unwound (Communiqué Art. 6(3)).

Margin trading: limits, equity and margin calls

Limits for brokers. At any time, the total credit a broker has extended may not exceed twice the average of its equity at the last three month-ends. The same limit applies separately to the total value of shares sold short for clients and for the broker’s own account (Art. 7(1)). SPK may lower these limits for a particular broker, or prohibit it from carrying out these transactions, having regard to its financial position or transactions (Art. 7(4)). Credit to a single client may not exceed 10% of the broker’s average equity, and credit to connected persons is aggregated for this purpose (Art. 8(1) and (3)). In addition, the shares of a single issuer held on credit across all client accounts may not exceed 50% of the broker’s average equity (Art. 8(4)).

Separate account. The broker must open a separate credit account for each client using margin purchases or short sales, and separate accounts where a client uses both. Obligations under these transactions may not be settled from the client’s other accounts unless the client gives a written instruction (Art. 10).

What counts as equity. Eligible equity consists of Turkish lira and convertible foreign currency in cash, instruments on the eligible lists, fund units and, if traded on the exchange, government bonds, Treasury bills, exchange-traded fund units, gold and other precious metals meeting the standards set by the Ministry of Treasury and Finance, and other instruments approved by SPK (Art. 12(1)). The following proportions of value count as equity (Art. 12(2), as amended in 2021):

1. 1. Cash, government bonds, Treasury bills, qualifying gold and precious metals and other instruments SPK accepts: 100%.
2. 2. Shares: the proportion set by Borsa Istanbul. Under the Equity Market Directive, this is 90% on the Star Market, 75% on the Main Market and 0% in the other segments (Directive Art. 39(1)).
3. 3. Exchange-traded fund units: 90%.
4. 4. Units of funds linked to equity umbrella funds and hedge umbrella funds: 75%.
5. 5. Other fund units: 90%.

Brokers may apply higher equity ratios according to the client’s financial position and the risk of the instruments (Art. 12(5)). SPK may raise or lower the equity ratio generally, after obtaining the Central Bank’s opinion, or for particular brokers, and it may set ratios by instrument or market (Art. 12(7)). Since the 2021 amendment, the proceeds of a sale of shares count as equity from the moment of sale, even for shares with a 0% ratio or subject to gross settlement (Art. 12(8)).

Valuation and halted shares. Instruments are valued at the purchase price on the day of purchase and afterwards at the weighted average price of the previous session. If there was no trading, the average of the best bid and offer in the last session is used (Art. 13(1)). If trading in a share has been halted for more than five business days and the exchange decides to continue the halt, the share loses its value as collateral. It is not accepted as equity, and shares already held as equity are ignored in the calculation (Art. 13(3)). A prolonged trading halt can therefore trigger margin calls even where the share price has not fallen. Trading halts are discussed in our guide to trading halts, the Watchlist Market and delisting.

Initial and maintenance equity. A client making a margin purchase must initially put up equity of at least 50%. Throughout the transaction, the equity ratio must be at least 35%. The ratio is calculated as (current market value of the account assets − credit) ÷ current market value of the account assets (Art. 17(2)–(3)). The client may ask for a clause in the framework agreement under which the broker sells at a higher ratio to stop losses (Art. 17(5)).

Margin calls. The broker must calculate each client’s equity every business day (Art. 18(1)). If equity falls below the required level, the broker must notify the client on the same day, by the fastest means available, to deposit cash or instruments that bring the ratio back to the initial level, and must obtain confirmation (Art. 18(2)). If the equity is not restored within the period in the framework agreement, which may not exceed two business days from the notice, the broker may sell the instruments and close the credit without further notice. Until the equity is restored, no buy orders from the client are executed (Art. 18(3)).

Rights and maturity. Dividends, interest and voting rights on shares bought on credit or deposited as equity belong to the client. The broker exercises bonus share and subscription rights for the client’s account (Art. 20). The broker may fund client credit by borrowing from banks, Takasbank and other approved institutions against the shares, but may not pledge more than the lender requires, and the lender may not sell, re-pledge or lend the shares (Art. 21). The credit falls due if a margin call is not met, if the credit term ends or if the instrument is removed from the eligible list (Art. 22(1)).

Relaxation of the 35% ratio. In periods of market stress, SPK has allowed brokers to apply a lower maintenance ratio. Its decisions provide that, for as long as margin transactions continue, the 35% ratio in Art. 17 “may be applied flexibly” with a minimum of 20%. Brokers may do so to the extent consistent with their own risk policies, taking account of client demands as far as possible. Such decisions were taken on 23 March 2025, on 1 March 2026 and on 17 September 2026. The last was extended on 3 October 2026 until the end of the session on 30 October 2026 (Bulletins 2025/18, 2026/11, 2026/60 and 2026/68). The decisions permit a lower ratio but do not require it. They also leave the 50% initial requirement unchanged.

Short selling: equity, flagging, price rule and prohibited persons

Equity. A short seller must initially put up equity of at least 50% of the current market value of the instruments to be sold. Throughout the position, the equity ratio must be 35%. The ratio is (current market value of the account assets, including the sale proceeds and the equity deposited − current market value of the instruments sold short) ÷ current market value of the account assets (Arts. 3 and 25(2)–(3)). The broker must calculate the equity every business day and, if it falls below the minimum, send a written margin call on the same day requiring the client to restore the initial ratio. If the equity is not restored within the period in the agreement, which may not exceed two business days, the broker may close the short position using the sale proceeds or by selling the instruments deposited as equity (Art. 26). Instruments bought on credit may never be used as equity for short sales. Instruments bought for cash may be used only with the client’s written consent (Art. 12(4)).

Flagging. The client must notify the broker in writing, when giving the order, that it is a short-sale order. For oral orders, the client must say so when giving the order, and the broker must record the notice (Art. 24(2)). When transmitting the order to the exchange, the broker must clearly identify it as a short-sale order. This applies to orders the client has declared, orders the broker has identified as short sales under Art. 24(3) and the broker’s own short sales (Art. 28(1)). If a short sale declared by the client or identified by the broker is not flagged to the exchange, the broker bears the penal responsibility. The client and the broker are each separately responsible for every short-sale notification they are required to make (Art. 28(2)–(3)). Short-sale orders are a distinct order type under the exchange rules and are subject to the price restrictions set by SPK and the exchange (Directive Art. 6(1)(d)).

Uptick rule. The exchange may decide that an instrument may be sold short only at a price higher than the last traded price, or at the last traded price if that price was higher than the one before it. It may apply this rule by broker, market or instrument and must notify SPK with its reasons. SPK may itself impose or lift this requirement by broker, market or instrument (Art. 29, as amended by Communiqué Serial V No. 133, Official Gazette 31 December 2012). Under the current Equity Market Directive, the uptick rule applies on the Main Market but not on the Star Market (Directive Art. 39(1)).

Prohibited persons. The directors and senior staff of an issuer, holders of 10% or more of its shares, persons found to be acting together with them, and their spouses and children under their custody may not sell the issuer’s capital market instruments short (Art. 30). If such a person sells short on the basis of inside information, the conduct may also fall under the insider dealing offence. See our guide to insider dealing.

Public offerings. Brokers may not carry out short sales in instruments being sold to the public by sale on the exchange (Art. 15(1)).

Delivery failure. The Communiqué does not itself require the seller to have borrowed the instruments before selling. It secures delivery through the settlement and default rules. If the instruments sold are not delivered within the settlement period, default rules apply. Within two business days after the settlement date at the latest, the broker must buy the instruments in the market for the defaulting client’s account (where the brokerage agreement allows this) or apply the exchange’s default rules or general law (Art. 24(4)). A client who fails to meet a cash or securities settlement obligation, or a margin call, more than twice within three months must be reported to the exchange within two business days, and the exchange announces the client’s identity. For six months, brokers may accept that client’s orders only if the cash or securities are already in the account, and the client may not trade on others’ accounts under a power of attorney. Small amounts below a threshold that is revalued annually, or not exceeding 5% of the client’s net assets, need not be reported (Art. 35(1) and (3)).

Exemptions. Transactions by market makers authorised to provide two-way quotes for government debt securities are not short sales. The same applies to sales by market makers authorised by the exchange where they quote and sell before buying, in quantities not covered by their portfolio (Art. 24(5)–(6)).

Securities lending: bilateral loans and Takasbank’s lending market

Consent of the owner. A broker may lend instruments it holds for its own account. It may lend instruments held in the accounts of clients, or of other persons and institutions holding portfolios, only if they have authorised it and only after obtaining the client’s instruction, in writing or by any means of communication, before each loan (Art. 31(2)). This reflects the general rule in the Capital Markets Law. Investors’ cash and instruments held by investment firms must be monitored separately from the firm’s own assets, and may not be used other than for the purpose for which they were deposited in a way that benefits the firm or third parties without the investor’s express written consent (Law Art. 46(5)). Client assets held by investment firms are discussed in our guide to investment services rules under Communiqué III-37.1.

Collateral. The borrower must provide collateral of at least 100% of the current value of the borrowed instruments. Any amount above that is agreed freely by the parties. The collateral must consist of assets eligible as equity under Art. 12 (Art. 33(1)–(2)). The difference between the collateral and the value of the lent instruments is monitored daily. If the collateral falls below 100%, the borrower must be notified in writing on the same day by the fastest means available. Where the borrower is the broker and the lender is the broker’s own client, no notice is needed and the broker must restore the collateral to its initial level. The collateral must be restored on the day the notice is received. Otherwise the obligations are met from the collateral and from the borrower’s short-sale equity without further notice, and any shortfall is claimed from the borrower (Art. 33(3)–(4)). On the day of the loan, instruments are valued at the weighted average price of the previous session (Art. 33(5)).

Dividends and corporate actions. If the issuer pays dividends or interest before the borrowed instruments are returned, the borrower must pay the same amounts to the lender under the framework agreement. For subscription rights and bonus shares, the parties determine their obligations freely in the framework agreement (Art. 32(1)–(2)).

Maturity. The lending debt falls due if the borrower does not meet a collateral call, if the loan term ends or if the shares sold short are removed from the eligible list. Where the agreement allows, the collateral may then be realised or transferred to the broker’s account. In matters not covered by the Communiqué, the framework agreement and general law apply (Art. 34).

Takasbank’s Securities Lending Market. Takasbank operates a Securities Lending Market (Ödünç Pay Piyasası, ÖPP) in which brokers, banks and other eligible institutions, for themselves and their clients, lend and borrow shares and exchange-traded fund units against collateral. The instruments that can be lent are selected by Takasbank from those eligible for margin purchases and short sales (Takasbank Clearing Services Directive Art. 4). The main rules are as follows:

1. 1. Takasbank is the central counterparty by open offer. It is the borrower to the lender and the lender to the borrower (Art. 58(1)(b)). Its obligation starts when orders are matched and ends when the obligations are settled (Art. 58(3)).
2. 2. Takasbank deals only with its members. For transactions made for clients, the member is Takasbank’s counterparty, and Takasbank is not responsible for members’ obligations to their clients (Art. 58(2)).
3. 3. At maturity, Takasbank must return the instruments to the lender and pay the lending fee. If the instruments cannot be returned, the member is paid a cash equivalent calculated under Takasbank’s procedure (Art. 58(5)).
4. 4. Instruments are delivered against collateral (Art. 19(3)) and returned through accounts at the Central Registry (MKK) (Art. 59(1)).
5. 5. Orders are entered separately for the member’s portfolio, clients, investment funds and investment companies. Client positions and collateral are kept in individual accounts for each client, separate from the member’s own, and collateral linked to individual client positions is deemed to belong to the clients (Arts. 60(1) and 61(1)).
6. 6. Financial rights on lent shares (rights issues, bonus issues and dividends) belong to the lender, but the lender loses the voting right on the lent shares. If a capital reduction occurs during the loan, the number of shares on loan is adjusted (Art. 63(1)).
7. 7. Shares removed from the margin and short-sale lists are removed from the lendable instruments after the settlement period following the last date on which they could be used in such transactions (Art. 60(4)).
8. 8. Members may not trade for accounts subject to an SPK trading ban. In the lending market, they may not trade for portfolio or client accounts that are in securities default (Art. 13(3)–(4)).

Takasbank amended the Directive and its lending market procedure by General Letter No. 2141 of 31 March 2026, after SPK approved the changes on 29 January 2026. Members must provide membership collateral for the lending market, to be completed by 3 April 2026, and the procedure on order changes, collateral calls and rights on lent instruments was clarified. In 2020, SPK linked the partial lifting of an earlier short-selling ban to Takasbank’s automatic lending instruction screens, which made it possible to lend BIST 30 shares through the lending market (Bulletin 2020/40). The role of Takasbank as central counterparty more generally is explained in our guide to clearing and settlement, and the recording of shares at MKK in our guide to MKK and book-entry securities.

Voting. In the lending market, the Directive expressly provides that the lender loses the vote on lent shares. For bilateral loans, the Communiqué deals with dividends, subscription rights and bonus shares but not with voting. Who can vote therefore depends on the framework agreement and on whose account the shares are held at MKK on the relevant date. An institution that wants to vote at a general meeting must recall lent shares, or restrict lending, in time for them to be held in its account when the right to attend is determined. Shareholder rights at general meetings are explained in our guide to shareholder rights.

Turkish investment funds. A Turkish investment fund may lend up to 50% of the market value of the capital market instruments in its portfolio, under an agreement complying with SPK rules. The loan may be made only if assets eligible as equity, worth at least 100% of the lent instruments, are blocked at Takasbank in the fund’s name. Every lending agreement must allow the fund to terminate it unilaterally (Communiqué III-52.1 Art. 22(1), (2) and (4)). Ordinary funds may not make short sales or margin purchases (Art. 24(4)). Hedge funds are not subject to these portfolio and transaction limits and may invest within the strategy and limits published on their KAP page (Art. 25(1)). Fund rules are covered in our guide to Turkish investment fund rules.

SPK’s power to ban or restrict

SPK can restrict short selling, margin trading and lending in four ways.

Market-wide measures under the general power. SPK’s market-wide bans in 2025 and 2026 were based on Art. 1 of the Capital Markets Law, which states the Law’s purpose, and on Art. 128(1)(a), which empowers SPK to take the actions needed to carry out its duties under the Law and to achieve the results it requires. The decisions referred to developments in the Borsa Istanbul markets and to the aims of ensuring that the capital markets operate in a reliable, transparent and stable environment and of protecting investors’ rights and interests (Bulletins 2025/18 and 2026/11). Earlier decisions on short selling also referred to Arts. 24 and 28 of the Communiqué (Bulletin 2020/40).

Targeted measures in market abuse cases. Where there is reasonable suspicion that a person has committed market-disrupting acts, insider dealing or market manipulation (Arts. 104, 106 and 107), SPK may take measures concerning that person and the relevant capital market instruments. These include restrictions on margin purchases, short sales and lending, as well as trading bans, changes to settlement methods, collateral requirements and transaction or position limits (Art. 101(1)). Our guides to market-disrupting acts under Art. 104 and market manipulation under Art. 107 explain how these measures are used.

Powers under the Communiqué. SPK may change equity ratios generally or for particular brokers, instruments or markets (Art. 12(7)). It may impose or lift the uptick rule by broker, market or instrument (Art. 29(2)). It may lower a broker’s limits or prohibit it from these transactions (Art. 7(4)), and it may ask the exchange to remove instruments from the eligible lists (Art. 6(2)).

Exchange measures. Borsa Istanbul’s General Manager may change the trading principles that apply to a particular share, having regard to its liquidity and other market conditions (Directive Art. 39(3)). Moving a share to the Sub-Market or the Watchlist Market removes margin purchases and short sales (Art. 39(1)). The exchange rules are explained in our guide to Borsa Istanbul trading rules.

Bans and relaxations, 2023 to 2026

SPK’s published decisions show how these powers have been used in recent years. The table lists the main decisions. Several bans were extended by further decisions, and not every extension is listed.

Four features of these decisions are relevant to investors. First, they are short and time-limited, and were renewed in stages. The applicable rule on a particular day must therefore be checked against the bulletin then in force. Second, the bans applied to the equity markets of Borsa Istanbul and extended to unflagged intraday positions. Third, the decisions concerned short sales and the margin maintenance ratio. They did not deal expressly with securities lending or with positions opened before the ban. Fourth, the September and October 2026 decisions relaxed the margin ratio but did not reintroduce a short-selling ban. When the March to June 2026 measures ended, Borsa Istanbul also restored its order-to-trade ratio in the equity market to 5/1 from 29 June 2026.

The March 2025 decision also relaxed several conditions on share buy-backs, such as price limits and the session times in which buy-back orders may be given. Buy-back rules are explained in our guide to share buy-backs.

Breaches, sanctions and market abuse

Administrative fines. SPK imposes administrative fines on persons who breach regulations made under the Capital Markets Law or SPK’s general and specific decisions (Art. 103(1)). The amounts are set in the Law and revalued every year. Where a benefit has been obtained, the fine may not be less than twice the benefit. A legal person may be fined up to the higher of 1% of the gross sales and 20% of the pre-tax profit in its last audited annual financial statements before the breach. Where the breach is committed by an organ or representative of a legal person, or by a person acting within its activities, the legal person is also fined (Art. 103(2)). In March 2024, for example, SPK fined two brokerage firms and three individuals for acting contrary to its short-selling rules. The fines were based on Art. 24 of the Communiqué and on the Board decision of 6 February 2023 (Bulletin 2024/14).

Short selling and manipulation. Short selling is lawful within the rules. It may, however, form part of transaction-based manipulation where sales or orders are made to create a false or misleading impression about prices, price changes, supply or demand. That offence carries three to five years’ imprisonment and a judicial fine of five thousand to ten thousand days, which may not be less than the benefit obtained (Art. 107(1)). Conduct that does not meet the criminal test may be a market-disrupting act subject to administrative measures (Art. 104). The same analysis applies to purchases financed with margin credit. Whether particular trades are abusive depends on the facts and the evidence in each case.

Breach of trust by investment firms. The Law treats as qualified breach of trust the sale, use, pledging, concealment or denial, for one’s own or another’s benefit, of capital market instruments, cash or other assets deposited with an investment firm in connection with capital market activities. The sentence under Criminal Code Art. 155(2) may then not be less than three years (Art. 110(1)(a)). Lending a client’s shares without authorisation may raise this issue, depending on the facts. Criminal law aspects are discussed in our guide to Criminal Code offences in capital markets cases.

Disputes and remedies

Against the broker. The relationship between a broker and its client in these transactions is governed by the framework agreements and, where they are silent, by general law (Arts. 11, 22(3) and 34(3)). Framework agreements may not contain provisions contrary to capital markets legislation, provisions that seriously harm clients’ rights and give the broker extraordinary one-sided rights, or provisions placing on the client the burden of proving its orders (Art. 11(3)). Disputes typically concern three issues. The first is whether a forced sale after a margin call respected the notice and time limits in Arts. 18 and 26. The second is whether a stop-loss clause agreed under Arts. 17(5) or 25(5) was applied. The third is whether client securities were lent with authorisation and a prior instruction under Art. 31(2). Our guide to claims against brokers, custodians and portfolio managers explains the liability rules.

Against the lending counterparty. In a bilateral loan, the lender’s protection is the collateral of at least 100% and the same-day top-up rule (Art. 33). In the lending market, Takasbank is the counterparty of each member, and the lender’s claim runs against Takasbank through its member. If the shares cannot be returned, the lender receives a cash equivalent (Takasbank Directive Art. 58). Collateral deposited for these transactions is protected from the creditors of the investment firm (Law Art. 46(4)), and client assets are protected from attachment for the firm’s debts and from its bankruptcy estate (Art. 46(6)).

Against SPK. SPK’s decisions, including market-wide bans and individual measures, are administrative acts. They may be challenged before the administrative courts within the time limits of the Administrative Procedure Law No. 2577, generally 60 days. Where an SPK act or failure to act causes loss, a full remedy action may be considered. See our guide to suing the Capital Markets Board.

Market abuse claims. Where short sales or credit-financed purchases form part of manipulation or market disruption, investors who suffer loss may have tort claims against those responsible, in addition to SPK’s measures and any criminal proceedings. Such claims depend on proof of the conduct, the loss and the causal link.

Points for foreign institutional investors

As lenders. An institution lending Turkish shares through a custodian or agent lender should know whether the loans are made bilaterally under the Communiqué or through Takasbank’s lending market. The two routes differ in counterparty risk, collateral and voting. In the lending market, Takasbank is the central counterparty and the lender loses the vote while its shares are on loan. In a bilateral loan, the lender’s protection depends on the borrower, the collateral of at least 100% and the framework agreement. Dividends must be compensated in both cases (Communiqué Art. 32(1); Takasbank Directive Art. 63(1)).

In periods of stress. SPK’s bans and relaxations can be introduced overnight and renewed at short intervals. A ban on short sales reduces borrowing demand and may affect lending income. A relaxation of the margin ratio may delay forced sales by leveraged investors. A trading halt of more than five business days removes the halted share’s value as collateral (Art. 13(3)). Collateral posted in shares may also fall in value quickly.

As shareholders. The Communiqué prohibits directors, senior staff and holders of 10% or more from selling their company’s securities short (Art. 30). Takasbank publishes statistics on its lending market, which may help an institution understand borrowing activity in shares it holds. Price movements and lending volumes alone, however, do not show that any rule has been breached.

Frequently asked questions

Is short selling currently allowed on Borsa Istanbul?

The short-selling ban that began on 2 March 2026 ended with the session of 26 June 2026 and was not extended. SPK’s decisions of 17 September and 3 October 2026 relaxed the margin ratio but did not reintroduce a ban. Whether short selling is available in a particular share also depends on its market segment and on any decision in force at the time.

Which rules govern short selling and securities lending in Turkey?

Capital Markets Law Arts. 39(7), 46 and 101, Communiqué Serial V No. 65, the Borsa Istanbul Equity Market Directive and, for the lending market, Takasbank’s Clearing Services Directive and procedure.

Is Communiqué Serial V No. 65 still in force even though it was issued under the old law?

Yes. Under Provisional Art. 1(1) of Law No. 6362, existing regulations continue to apply to the extent not contrary to the Law until new regulations enter into force. SPK’s 2025 and 2026 decisions apply its Art. 17.

Which shares can be sold short or bought on margin?

Shares on the Star Market and the Main Market. Margin purchases and short sales are not available on the Sub-Market, the Watchlist Market or the Pre-Market Trading Platform (Equity Market Directive Art. 39(1)).

What are the margin requirements?

At least 50% initial equity and a 35% maintenance ratio, for both margin purchases and short sales (Communiqué Arts. 17 and 25). SPK has allowed brokers to apply a 20% maintenance ratio to margin purchases during certain periods.

How long does a client have to meet a margin call?

The period in the framework agreement, which may not exceed two business days from the notice. Otherwise the broker may close the position without further notice (Arts. 18(3) and 26(3)). In lending, the collateral must be topped up on the day the notice is received (Art. 33(4)).

Is there an uptick rule?

Yes, on the Main Market but not on the Star Market. The exchange and SPK may impose or lift it by broker, market or instrument (Communiqué Art. 29; Directive Art. 39(1)).

Who may not sell a company’s shares short?

Its directors and senior staff, holders of 10% or more of its shares, persons acting together with them, and their spouses and children under their custody (Art. 30).

Do short-selling bans cover intraday trades?

Yes. SPK’s decisions state that positions opened and closed on the same day without using the short-sale flag are also covered by the ban.

Can a broker lend my shares without my consent?

No. Client securities may be lent only with authorisation and after an instruction before each loan (Communiqué Art. 31(2)), and client assets may not be used for other purposes without express written consent (Law Art. 46(5)).

What collateral must a borrower provide?

At least 100% of the current value of the borrowed instruments, in assets eligible as equity, monitored daily (Art. 33).

Who receives dividends on lent shares?

The lender. In a bilateral loan, the borrower must pay the equivalent amount (Art. 32(1)). In Takasbank’s lending market, financial rights belong to the lender (Takasbank Directive Art. 63(1)).

Can the lender vote lent shares?

In Takasbank’s lending market, no: the lender loses the vote on lent shares (Art. 63(1)). A lender that wants to vote should recall the shares in time.

Can Turkish investment funds lend or short shares?

Funds may lend up to 50% of their portfolio instruments against collateral of at least 100% blocked at Takasbank. Ordinary funds may not sell short or buy on margin, while hedge funds may do so within their published strategy (Communiqué III-52.1 Arts. 22, 24(4) and 25(1)).

What sanctions apply for breaching a short-selling ban?

Administrative fines under Capital Markets Law Art. 103 on the client and the broker. In March 2024, SPK fined two brokerage firms and three individuals for breaching the 2023 ban (Bulletin 2024/14).

Related guides

• Turkey’s 2026 Fund and Market Manipulation Crisis: Legal Guide for Foreign Institutional Investors — the entry point to this series
• MSCI’s Turkey Index Freeze and the Legal Response
• Lease Certificates (Sukuk) in Turkey
• Inflation Accounting in Turkey: TMS 29 and the Tax Books
• Individual Application to Turkey’s Constitutional Court and the ECHR
• Privileged Shares in Turkish Listed Companies
• Enforcing a Money Judgment in Turkey
• Turkey’s Emissions Trading System and Climate Law No. 7552
• Anti-Money Laundering Rules for Foreign Investors in Turkey
• Recovering Investor Losses from Insurers in Turkey
• Service of Documents in Turkish Proceedings
• Voting at Turkish General Meetings from Abroad
• Derivatives in Turkey: VİOP, OTC and Leveraged Trading
• SPK Investigations in Turkey: Powers, Secrecy and Reports
• Borsa Istanbul Trading Rules
• Clearing and Settlement: Takasbank as Central Counterparty
• Market-Disrupting Acts in Turkey: Capital Markets Law Art. 104
• Market Manipulation under Turkish Law
• Share Buy-Backs in Turkey
• Investment Services Rules in Turkey
• Claims Against Brokers, Custodians and Portfolio Managers in Turkey
• Suing the Capital Markets Board in Turkey
• Turkish Investment Fund Rules