.. 

MEMORANDUM 

OF 

UNDERSTANDING 

'1HB UNrl'BD St'ATBS C4Pl7AL JfA.lUC.B2'S BOARD 

COJIOIODlTY .nrrr:IRBB T.RADJ'NG COJfJI18SlON OF TURlCBY 

CONCERNING COKSULTATION AKD COOPBRATION 

AllD TBE EXCHANGE OF IKFORMA.TION 

June 25, 2001 
The United States Commodity Futures Trading Commission and lhe Capital Markets 

Board of Turkey, recognising increased international activity in futures transactions and 

the cotmsponding need for mutual cooperation between relevant authorities, have 

reached the following understanding. 

DEFINITIONS 

For the purposes of this Memorandum of Understanding: 

1. "Authority" means: 

.· (a) the Commodity Futures Trading Commission of the United States; 

or 

(b) the Capital Mal1<.ets Board of Turkey. 

2. "Requested Authority" means an Authority to whom a request is made 

under this Memorandum of Understanding. 

3. • "ReQuesting Authority" means an Authority making a request under this 

Memorandt.m ot Understanding. 

4. "Futures Contract .. means a futures or options transaction regulated or 

subject to regulation by the Authorities whether transacted over-theoounter or on or subject to the rules of an exchange or market 

5. "Futures Business,. includes, among others, any person involved in: the 

offer, purchase or sale of Futures Contracts for the account of others; the 

purchase or sale of Futures Contracts for one's own account; advising 

others for compensation, direcUy or through media. regarding the offer. 

purchase or sale of Futures Contracts; the management, promotion, offer . 

or sale of collective investment schemes involving Futures Contracts; or 

equivalent activities. The definition of a Future,s Business also includes , 

persons, among others. acting in the capacity. of commodity trading 

advisors, commodity pool operators, futures commission merchants, 

introducing brQkers, associated persons, floor brokers and floor traders. 

6. "Futures Market" means an exchange or other market. including an overthe-counter market, for Futures Contracts that is recognized. supervised 

or subject to regulation by the Authorities. · 

7. "Futures Process;ng Business" means a clearing organization for Futures 

Contracts. 

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8. ..LatNS and/or Regulations" means the provisions of the laws of the United 

States and/or Turkey, the regutations promulgated thereunder, and other 

regulatory requirements that fall within the jurisdiction of the Authorities, 

concerning Futures Contracts. 

9. "Person• means a natu1al person, unincorporated association. 

partnership. trust, body corporate, or government - or a potitical 

subdivision, agency, instrumentality or equivalent authority of a 

government. 

9.5. ••self-Regulatory Organization" means an organization empowered by a 

govemment to administer or enforce a law, rule, or regulation·as it relates 

to a futures or options matter. 

ESTABUSHMENT OF A FRAMEWORK fOR CONSULTATIONS REGARDING 

MATTERS OF MUTUAL INTEREST 

10. The Authorities Intend to consult periodically about matters of mutual 

concem. Such consultation will be undertaken in the interest ·of improving 

cooperation to avoid the conflicts that may arise from the application of 

differing regulatory laws, regulations and practices. and to enhance: the 

efficlency and integrity of the Futures Markets of the United Statea and 

Turkey: the protection of inyestors and customers; appropriate market 

oversight: and the· effective performance by the Authorities of their 

respective functions reg"rding the laws and/or· Regulations of the United 

States and Ttxkey. · 

MUTuAL ASSISTANCE AND THE EXCHANGE OF INFORMATION 

11. General Principles regarding Mutual Assiatance and the Exchange of 

Information 

(a) This Memorandum of Understanding sets forth the Authorities• 

intent with regard to mutual assistance and the exchange of 

infonnation for the purpose of enforcing and securing compftance 

with the respective Laws and/or Regulations of the Authorities. 

This Memorandum of Understanding does not create legally 

binding· obligations or supersede domestic Jaws.. This 

Memorandum of Understanding does not create any rights 

enforceable by third panies. nor does it affect any arrangements 

under other Memoranda of Understanding. 

(b) This Memorandum of Understanding does not prohibit an Authority 

from taking measures other than those described herein to obtain 

information necessary to ensure enforcement of or compliance with 

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the Laws and/or Regulations appftcable in its jurisdiction. In 

particular. this Memorandum of Understanding does not affect any 

right of any Authority to communicate with, or obtain information or 

documents from, any Person on a voluntary basis in the jurisdiction 

of the other Authority. 

{c) This Memorandum of Understanding does not confer upon any 

Person not deftned as an AuthQrity within this Memorandum of 

Understanding. the right or ability directly or indirectly to obtain, 

suppress or exclude any information or to challenge the execution 

of a request for assistance under this Memorandum of 

Understanding. 

(d) The Authorities recognize the importance and desirabi1ity of 

exchanging assistance and information forthe purpose of enfotclng 

and securing compliance with the laws and/or Regulations 

applicable in their respective jurisdictions. However, a request for 

assistance may be denied by the Requested Authority: 

(i) where the request would require the Requested Authority to act 

in a manner that would violate its domestic law; 

(iij where the request is not made in accordance with the 

provisions of this Memorandum of Understanding; or 

(iij on grounds of publk: interest. 

Where a.crequest for assistance is denied, or where assistance is not 

avaUab1tr under its domestic law, the Requested Authority wrll provide the 

reasons for not granting the assistance and consuH pursuant to paragraph 

17. 

12. Scope of Assistance 

(a) The Authorities will, within the framework of this Memorandum of 

Understanding. provide each other with the fullest assistance .-

pennissible ooder the laws of the United States and Turkey. Such 

assistance wil be provided in order to facilitate: market oversight 

including m• and financial surveiianoe: the granting of licenses, 

authorizations. waivers or exemptions for the conduct of ·Futures 

Businesses and Futures Processing Businesses; the superVision of 

Futures Businesses and Futures Processing Businesses; the 

inspection of Futures Businesses and Futures Processing 

Businesses; th8 ilvestigation, litigation or prosecution by the 

Authorities of activity that potentially violates the Laws and/or 

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) 

" . ,-_,)· 

\ ' 

' .... .. . .=.:.;. .. 
Regulations applicable in their respective jurisdictions; and any 

other matters that the Authorities deem appropriate. 

(b} The assistance available under this Memorandum of 

Understanding includes. without limitation: 

(i) providing information held in 1he files of the Requested Authority 

upon request by the Requesting Authority; 

OQ taking statements of Persons; and 

(ii~ obtaining information and documents from Persons.· 

(c) The Authorities recognize that they may not in aU circums1ances 

possess the legal authority to provide the ·assistance or information 

·referred to in paragraph 12. In such circumstances. the Authorities 

will use all reasonable efforts to obtain the aid of such o1her 

governmental agencies that can provide the assistance or 

information described in paragraph 12. 

13. Requests For Assistance 

(a) Requests for assistance will be made in writing and will be 

addressed -to the Requested Authority's contact offiCer lis1ed in 

Appendix A. 

(b) Requests for assistance wftl include 1he following: 

(i} a general description of both the subject matter of the request 

and 1he purpose for which the assistance. or information is 

sought; 

(ii) a general description of the assistance, documents, information, 

· or statements sought by the Requesting Authority; 

(ii) any information · known to or in the possession of the 

Requesting Authority that might assist the Requested Authority 

in identifying either the Persons believed to possess the 

information . or docunents sought or the places where such 

information may be obtained; 

(iv) the Laws andlor Regulations pertaining to the subject matter of 

the request; and 

(v) the desired time period for the reply. 

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(c) In urgent circumstances. requests for assistancet and the response ·· ,-) 

to such requests, may be effected by telephone or facsimile1 

provided such communication is confirmed in writing. 

14. Execution of Requests for Assistance 

(a) ·Information held in the files of the Requested Authority will be 

provided to the Requesting Authority upon request 

(b) Upon reque$t, the Requested Authority wiA take the statements of 

any Person Involved. directly or indirectly1 in the activities that are 

the subject matter of the request for assistance or in possession of 

information that may assist in the execution of the request. The 

Requested AuthoJity will make a transcript of any statement it takes 

on behalf of the Requesting Authority. 

{c) Unless otherwise decided by the Authorities. information . and 

documents requested under this Memorandum of Understanding 

will be gathered in accordance with the procedures applicable in 

the jurisdiction of the Requested· Authorly and by Persons 

designated by the Request:ecJ Authority. 

(d) _ Notwithstanding paragraph 14(c), any Person providing a 

statement pursuant to a request for assistance under this 

Memoranaom of UnderstarKfmg wHI have the right to have counsel 

present. 

(e) Notwithstanding a.ny other provision of this Memorandum of 

Understanding. any Person providing a statement, information. or 

documents as a result of a request for assistance under this 

Memorandum of Understanding wHI be entitled to alt rights and 

privileges applicable in the jurisdiction of the Requested Authority. 

Assertions regarding rights and privileges arising exclusively under 

the laws applicable In the jurisdiction lAthe Requesting Authority 

will be preserved for consideration by the courts in that jurisdiction. 

(f) Upon request, the Requested Authority will inspect specified bookst 

records. Futures Buslnesses1 or Futures Processing Businesses. 

{g) If it appears that responding to a request for assistance under this 

Memorandwn of Undet"Standing wiD involve substantial cost. the 

Requested Authority may, as a condition to executing the request. 

ask the Requesting Authority to make a contribution to such cost in 

an amount decided upon by the Authorities. 

15. Permissible Uaes of Information 
(a) The Requesting Authority may use non-public information furnished 

in response to a request for assistance under this ft,Jemorandum of 

Understanding solely: 

(Q for the purpose stated in the request for assistance with respect 

to ensuring compUance with or enforcement of the laws and/or 

Regulations applicable in the jurisdiction of the Requesting 

Authority, including the legal provisions specified in the request 

and related provisions; and 

(ii) for a purpose within the general framework of the use stated in 

the request for assistance, including conducting a civil or 

administrative enforcement proceeding, assisting in a selfregulatory organization's surveiDance or enforcement activities 

(insofar as it is involved in the supervision of tra~ing or conduct 

that is the subject of the request), assisting in a criminal 

prosecution. or conducting any investigation for any general 

charge applicable to the violation of the provisions specified in 

the request where such general charge pertains to a violation of 

the Laws. and/or Regulations administered by the Requesting 

Authority. 

(b) ~ Before using non-pubrac infonnation fumished_ under this 

Memorandum of Understanding for a purpose other than those 

stated in ·paragraph 15(a), the Requesting Authority must first 

inform the ReqUJ!Sted Authority of the intended use~ The 

Requested AuthoritY wtl advise its views within 14 days and, jf 

necessary. the Auttlorities wil consult pursuant to the provisions of 

paragraph 17 to discuss the reasons for any denial by the 

Requested Authority over such intended use and the circumstances 

under which the intended use might othetWise be alowed. Fourteenday advance notification need not be provided where disclosures are 

made to PeiSOns having the legal power to compel disclosure; in 

such cases, notification will be provided according 1o paragraph 

16(c). 

18, Confidentiality 

(a) The Requesting Authority will not disclose non·pubfiC information 

received under this Memorandum of Understanding, except as 

contemplated by paragraph 15 or pursuant to a legally enforceable 

demand. or in connection with an adJudicatory action or proceeding 

brought under the laws applicable in the jurisdiction of the 

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Requesting Authority to which the Requesting Authority or its 

government. or a political subdivision thereof, is a party. 

(b) Notwithstanding the provisions of paragraph 16(a), each Authority 

wilt keep confidential, to the extent permitted by law, requests 

made pursuant to this Memorandum of Understanding, 

consultations between the Authorities (including consultations 

under paragraph 10), and unsolicited assistance under paragraph 

18, unless: 

(i} such disclosure is absolutely necessary to cany out a 

request; or 

(iil the other Authority waives such confidentiality. 

Consultations behveen the Authorities include. but are not Dmited to, 

correspondence and other exchanges in YAlich the Authorities share 

investigative analyses, progress, procedures or strategies. 

(c) To the extent possible, the Requesting Authority will notify the 

Requested Authority of any legaRy enforceable demand for nonpubic infonnation furnished under this Memorandum of 

. Understanding prior to compliances and wUI assert such appropriate 

legal exemptions or privileges with respect to such information as 

may be avai1ab1e. ·· 

... 

(d) To the extent permitted by law, the Authorities may by mutual 

written consent m~e an exception to the principles set forth in 

paragraph 16(a) and (b). 

(e) In response to a request by the Requested Authority., and to the 

extent permitted by law. as soon as the Requesting Authority has 

tenninated the matter for which assistance has been requested 

under this Memorandum of . Understanding. it will retum to the 

Requested Authority all documents and copies thereof not already 

disclosed in proceedings referred to in paragraph 15(a) and other 

material disclosing the contents of sucb documents, other than 

material that is generated as part of the investigative. deliberative or 

internal analytical process of the Requesting Authority. 

17. · Conaultatlan Regarding Mutual Assistance and the Exchange of 

Information 

(a) In any case of dispute over the interpretation of 1his Memorandum of 

UndeiStanding., the AuthoriUes wil consult each other With a view to 

reacting a mutually acceptable interpretation. 

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{b) The Authorities wiD consult with each other regarding this 

Memorandum of Understanding with a view to improving its 

operation and resolving any matters ·that may arise .. In particulart 

the Authorities will consult in the event of: 

(c) 

(d) 

(i) an Authority's denial of a request made by the other Authority 

pursuant to this Memorandum of Understanding: 

(i) a change in market or business conditions or in the legislation 

governing the matters set forth in paragraph 8; and 

(iii) any other circumstanoe that makes it necessary or appropriate 

to amend or extend this Memorandum of Unders1anding in· 

order to achieve its purposes. 

The Authorities may agree on such practical measures as may be 

necessary to facilitate the implementation of this Memorandum of 

Understanding. 

Any of the conditions of this Memorandum of Understanding may 

be amen~ or waived by mutual written ·consent: 

18. Unsolicited Assistance 

. . 

To the extent permitted bY. the laws and/or Regulations of its respective 

jurisdiction, each Authority wil use reasonable efforts to provide the other 

Authority with any information it discovers that gives rise to a suspicion of 

a breach or an anticipated breach of the Laws and/or Regulations 

applicable in the jurisdiction of the other Authority. 

FINAL PROVISIONS 

19. Effective Date 

Cooperation in accordance with this Memorandum of Understanding will 

begin on the date of its signing by the Authorities. 

20. TermlnaUon 

Cooperation and assistance in accordance with this Memorandum of 

Understanding wll continue until the expiration of 30 days after any 

Authority gives written notice to the other Authority of its intention to 

discontinue cooperation and assistance hereunder. If any Authority gives · 

a termination notice, cooperation and assistance in accordance with this 

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• t .. ,.. 

Cooperation in accordance with this Memorandum of Understanding wiM 

begin on the date of its signing by the Authorities. · 

20.. Termination 

Cooperation and assistance in accordance with this Memorandum of 

Understanding wUI continue until the expiration of 30 days after any· 

Authority gives written notice to the other Authority of its intention to 

discontinue cooperation and assistance hereunder. If any Authority gives 

a termination notice. cooperation and assistance in accordance with this 

Memorandum of Understanding w111 oontinue with respect to an requests 

for assistance tha1 were made or information provided before the effective 

date of notification (as indicated in the notice but no earlier than the date 

the notice is sent) until the Requesting Authority terminates the matter for 

which assistance was requested. The provisions of this Memorandum of 

Understanding concerning conftdentiarrty wll continue thereafter with 

respect to information in the possession of the Requesting Authority. 

SIG~ IN DUPLICATE IN ENGLISH AND TURKISH AT SJ«Aho/rn. SWtcl;nTHIS ~f) ,.DAY OF JUNE, 2001. p . 

FORTHECOMMODRYFUTURES 

TRADING COMMISSION OF 

THE UNITED STATES: 

9 

FOR THE CAPITAL MARKETS 

BOARD OF TURKEY: 

Dr. Dogan C8n81zlar 

Chainnan 
APPENDIX A 

CONTACT OFFICERS 

US Commodity Futures Trading Commission 

Three Lafayette Centre 

1155 21• Street, NW 

Washington, DC 20581 

USA 

For aU information: 

Director, Division of Enforcement 

Chief Counsel, Division of Enforcement 

Tel: . (202) 418-5320 

Fax: (202) 418-5523 

Cap1tal Market Board 

Doc. Dr. Bahriye Ucok Cad. No: 13 

Basavlar 06500 

Ankara 

TURKEY 

For all information~ 

Head 

Research Department 

Tel: (90) 312 212 53 45 

Fax: (90) 312 215 56 14