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Exchange ( organized market)
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  1. Exchange (organized market) • An exchange (or bourse) is a highly organized market where (especially) tradable securities, commodities, foreign exchange, futures, and options contracts are sold and bought. • Exchanges bring together brokers and dealers who buy and sell these objects.

  2. Bourse • The name is derived from the 13th-century inn named TerBeurze in Bruges, Belgium where traders and foreign merchants from across Europe conducted business in the late medieval period. The building, which was established by Robert van der Buerze as a hostelry, had operated from 1285. Its managers became famous for offering judicious financial advice to the traders and merchants who frequented the building. This service became known as the "Beurze Purse" which is the basis of the word bourse, meaning an organised place of exchange. Eventually the building became solely a place for trading in commodities.

  3. STOCK EXCHANGE TÜRKİYE ODALAR VE BORSALAR BİRLİĞİ İLEODALAR VE BORSALAR KANUNUKanun Numarası : 5174Kabul Tarihi : 18/5/2004Yayımlandığı R.Gazete : Tarih : 1/6/2004 Sayı :25479Yayımlandığı Düstur : Tertip : 5 Cilt : 43

  4. 6362 CMA • ç) Borsa: Anonim şirket şeklinde kurulan, sermaye piyasası araçları, kambiyo ve kıymetli madenler ile kıymetli taşların ve Kurulca uygun görülen diğer sözleşmelerin, belgelerin ve kıymetlerin serbest rekabet şartları altında kolay ve güvenli birşekilde alınıp satılabilmesini sağlamak ve oluşan fiyatları tespit ve ilan etmek üzere kendisi veya piyasa işleticisi tarafından işletilen ve/veya yönetilen, alım satım emirlerini sonuçlandıracak şekilde bir araya getiren veya bu emirlerin bir araya gelmesini kolaylaştıran, bu Kanuna uygun olarak yetkilendirilen ve düzenli faaliyet gösteren sistemleri ve pazar yerlerini,

  5. 5174, Art.3 • Commodity Exchange: Product exchanges having the title of commodity exchange and product specific commodity exchanges,

  6. Art.28-76 • THIRD DIVISION CommodityExchanges • FIRST PART General Principles On CommodityExchanges

  7. Establishment of commodity exchanges • Commodity exchanges are established by the Ministry upon the affirmative decision of the Union in the provinces in line with the requirements of commercial necessities. • Commodity exchanges having a private nature may also be established to perform country-wide, regional and international activities.

  8. Art.28 • ARTICLE 28. – Commodity exchanges are public legal entities established for engaging in purchase and sale of goods that fall under a commodity exchange and as well as determination, registration and announcement of the prices of such goods formed in the commodity exchange in accordance with the principles stated in this Law. • Foreign currency exchanges and exchanges for valuable mines are excluded from the scope of this Law.

  9. Compulsory registration to the commodity exchanges • ARTICLE 32. –The persons engaged in the activity of sale and purchase of the goods that are included in the quotation of commodity exchange, are obliged to register to the commodity exchange they are located. The registration of the persons, who have not acted in accordance with this obligation, shall be done by the exchange ex officio and such registration shall be notified to them. The member registrations that shall be done as per the profession groups shall be kept in a common database which is kept up-to-date and which is constituted in the Ministry and Union in an electronic form.

  10. ORGANS OF STOCK EXCHANGES • ARTICLE 35. –The organs of an exchange are as follows: a) Profession committee. b) Assembly. c) Board of Directors. d)Board of Discipline.

  11. COMMODITY EXCHANGE TRANSACTIONS • Fungible goods that are durable, storable and have sufficient supply and demands in commodity exchanges shall, as wholesale, be purchased and sold as a sample or type basis. Goods whose type is not determined and similar goods that meet the domestic necessities and animals that are alive or been slaughtered may also be considered as goods quoted to the commodity exchange. • Foreign exchange and precious metals are exempted from the scope of this Law.

  12. Product Specific Commodity Exchanges • The product specific commodity exchanges shall be established in the form of corporation that gathers the supply and demand of one or more products in its quotation within confidence, free competition and stability by considering the economical necessities; mediates the purchase and sale of products classified in accordance with the applicable product standards in physical or electronic places organized by themselves; executes both commerce of psychical products and of product deeds and future contracts that issued by the licensed storage operators as representing the product; having reliable restriction and dissimulation opportunities relating to the transactions; having institutional and financial infrastructure, technical and electronic hardware and data processing that shall follow and announce the occurred prices, generated information, and other similar and alternative markets that their working fields shall be regional, national or international.

  13. PERMISSIONS • The operation permission shall be given to the company that holds the establishment permission; in the case that it is demonstrated that the company has the conditions prescribed by this Law and by the regulations issued pursuant to this Law. The company obtained the operational permission shall operate with the name of product specific commodity exchange corporation.

  14. LICENCED STORAGE OPERATORS • Commodity exchanges and the product specific commodity exchanges may establish or become a partner of the companies operating as a licensed storage operators.

  15. Markets of Istanbul Gold Exchange • Istanbul Gold Exchange commenced its operations on July 26, 1995. The exchange has three types of markets: Precious Metals Market includes the spot trade of standard and non-standard gold, silver, platinum and palladium metals. Precious Metal Lending Market provide lending and certificate transactions of defined precious metals. Diamond and Precious Stones Market provides transactions of diamond and precious stones.

  16. Who Can Trade on the Market? • Domestic or foreign banks, precious metals brokerage companies, authorized corporations (formerly called currency office) precious metals producing and marketing companies, international precious metal companies with its full-authorized branch in Turkey that obtained the membership certificate from the Under-Secretariat of Turkish Treasury and complied with the requirements set forth by the IGE Board of Directors, are authorized for trading on the exchange. • Only IGE members are eligible to import precious metals and obliged to submit the import to the IGE vault within three business days after the arrival of precious metal to Turkey.

  17. Conduct of Trading • The members are represented by a broker on the floor who submits orders and executes transactions and the authorized person in the member’s head office. The brokers submit their order through a computer system either in session floor or from their office by using remote connection trading system. The system automatically matches orders submitted by the buyers and sellers. The orders are listed on the screen based on price and time priority. When a match occurs, the trade is automatically executed and registered. The pending orders are broadcasted worldwide beyond the trading floor through information broadcast services.

  18. İSTANBUL GOLD EXCHANGE • It took a long time to bring gold which has important social and economic roles in Turkey into its current financial situation. With the amendments in Decree number 32 concerning the Protection of the Value of Turkish Currency in 1993, determination of the gold price, gold export and import are liberalized. The decisions aimed at liberalization of gold helped import and export processes. The rapid growth seen in gold sector due to these developments accelerated new decisions concerning gold which has a great economic potential. These new decisions aimed at restructuring gold sector. In 1995 the Istanbul Gold Exchange (IGE) was opened (26.07.1995) and authority to import gold was given to the members of the IGE in addition to the Central Bank.

  19. Vision • Becoming an exchange that deepens the money market instruments, provides trading of all precious metals, precious stones, commodity and rights in international standards, with its dynamic and strong financial structure, being an impulsive force for local precious metals and stone markets and a reference exchange for international markets.

  20. Mission • Providing a safe and regulated perfect competition market conditions for precious metals and stones subject to trading in the Exchange including registration process for commodities that are traded in the Exchange in terms of buying, selling and production, making a contribution to develop new instruments, systems and fund management techniques based on commodities that are traded in the Exchange, facilitating funding problems of precious metals sector and companies, supporting education and collaboration activities to improve corporate structure of the Exchange members and their awareness, making contribution to the activities of Istanbul International Financial Center project.

  21. Targets • Achieving an organizational structure similar to the exchanges of developed countries, • Being an active member of the precious metals trading of Middle East and Turkic Republics in the world trade • Contributing to activities for securitizing precious metals, developing precious metal instruments based on derivatives, active using of fund management methods • Providing active usage of precious metals lending transactions and its certificates to ensure Turkish precious metals sector overcome financial difficulties • Creating a link between Turkish precious metals market and financial sector • Contributing Istanbul to be an international financial centre

  22. Activity Area • Registration of import and trade of unprocessed precious metals like gold, silver, platinum and palladium that are defined in Decree No.32 concerning the Protection of the Value of Turkish Currency which is issued in the Official Gazette dated 11/8/1989 • Registration and trade of precious metals that are domestically produced • Trade of precious metals with fineness lower than certain amount defined by “Communique of Standards and Refineries of metals to be Transacted on The Precious Metals Exchange”

  23. Physical exchange of the transactions between members of the Exchange • Storage of precious metals owned by members, mutual funds, exchange-traded funds assets • Studies for the development of instruments and legislation based on precious metals, • Import and export procedures for rough diamonds that are taken into consideration under the Kimberley Process Certification Scheme

  24. Dutiesand Powers • Creating markets in the Exchange for precious metals with standards defined by the Treasury • Providing legal regulations and organization for possible markets to be formed • Providing execution of trade in a secure and stable manner under free competition in the Exchange • Enforcing legal sanctions for members who violet Exchange rules • Taking necessary measures under the power of Exchange regulation in case of unfavorable incidents • Creating precious metals and lending markets based on transactions of capital market instruments • Performing tasks given by Turkish Treasury and Capital Markets Board.

  25. RefineryList • National and International Refineries authorized to trade its bars, bullions and granules of gold, silver, platinum and palladium in the Exchange.

  26. The first legal decision concerning the establishment of Istanbul Gold Exchange was made in 1993, "General Regulation Concerning the Foundation and Operation Principles of Precious Metals Exchanges" was issued by Capital Markets Board on the basis of the provisions of Article 40/A of Code of Capital Markets, number 2499 as amended by law number 3794.

  27. Diamond and Precious Stones Market • The Diamond and Precious Metals Market has opened by April 4, 2011 in Istanbul. Technical and legal infrastructural studies on diamond and precious stones have been managed. There has been an important step to integrate international communities such as World Federation of Diamond Bourses by May 2008, during the 33rd World Diamond Congress where the membership has been voted

  28. The target of Istanbul Gold Exchange is to establish a secure and organized market condition in Turkey for diamond and precious stones trading. Turkey is launching its first diamond market and aiming to become a regional trading hub for the precious stones, especially diamond.

  29. ArbitrationCommittee • According to the article 25 of the Regulation, duty of the Arbitration Committee is to resolve disputes in the market impartially. Full members and substitute members of the Diamond and Precious Stones Market Arbitration Committee are designated in the first meeting of the Exchange Board of Directors following to achievement of adequate number of members.

  30. PreciousMetalsLending Market • Precious Metals Lending Market was started its operations in Istanbul Gold Exchange on 24 March 2000 for the purpose of bringing supply and demand into an organized market, lowering the production costs of the jewellery sector and securitization of gold. • Two different types of transactions are realized on Precious Metals Lending Market: • Lending transactions for lending or borrowing physical precious metals Certificate transactions by trading of certificates representing lending transactions

  31. International Membership • Istanbul Gold Exchange was admitted to Kimberley Process Certification Scheme Market on August 14th 2007. • Istanbul Gold Exchange was admitted to associate membership of London Bullion Market on March 3rd 2008. • Istanbul Gold Exchange was admitted to membership of World Federation Diamond Bourses on May 13th 2008. • Istanbul Gold Exchange was admitted to membership of Federation of the Euro – Asia Stock Exchanges on February 12th 2010.

  32. THE UNION OF CHAMBERS AND COMMODITY EXCHANGES OF TURKEY (TOBB) • Establishment of TOBB Law #5590 on the Chambers, Commodity Exchanges and Union was promulgated on 8 March 1950 and entered into force upon its publication in the Official Gazette #7457 of 15 March 1950. Recently The Law #5174 replaced Law #5590 and has been effective as 1 June 2004.

  33. Legal Status of TOBB The Union of Chambers and Commodity Exchanges of Turkey (TOBB) is the highest legal entity in Turkey representing the private sector. Similar to the patterns of guilds and syndicates, which traditionally organized and represented tradesmen and producers throughout the Turkish History, TOBB, too, adopted a representative role in a democratic and modern society. Today, TOBB has 365 members in the form of local chambers of commerce, industry, commerce and industry, maritime commerce and commodity exchanges.

  34. The Union of Chambers and Commodity Exchanges of Turkey • ARTICLE 54. – TheUnion of Chambers and Commodity Exchanges of Turkey is a public entity having the nature of superior professional organization that has a legal entity, established in order to provide the unity and the solidarity between chambers and commodity exchanges, to provide the profession to be developed in accordance with the general interests of the profession, to facilitate the professional activities of the members of the chambers and commodity exchanges, to protect the professional disciplinary and moral in order to provide the honesty and confidence in relation with the members of chambers and commodity exchanges and the public, to make necessary studies so as to the development of the country, improvement of the economy and to perform the services envisaged by this Law. • The brief name of the Union is TOBB and the center of the Union is in Ankara.