The Energy Regulation and Markets Review - Stikeman Elliott

Turkey
that they held under the existing wholesale and retail sale licences. The market share
restriction for these activities is 20 per cent. Accordingly, the total amount of electricity
supplied by a group of companies cannot exceed 20 per cent of the total electricity
consumed in the previous year in the market.
Furthermore, the Draft EML abolishes the concept of the autoproduction
licence, and autoproduction licences will be converted to generation licences. Therefore,
autoproduction licence holders will have to apply to EMRA for the issuance of a generation
licence by 31 December 2012. No licence issuance fee will be charged for this.
Preliminary licences
According to Article 6 of the Draft EML, a preliminary licence will be granted to
those companies intending to carry out generation activities. The scope of this licence
corresponds to the pre-construction stage incorporated under generation licences under
the current regime. During the term of this licence, the preliminary licence holder
must obtain the necessary permits, approvals and licences and other similar required
documents, including the ownership or usufruct right to the area on which the generation
facility will be installed. The term of the preliminary licence cannot be longer than 24
months irrespective of force majeure events. EMRA, however, may extend the term of
the licence by half of the preliminary licence period depending on the fuel source and
installed capacity of the plant that will be constructed. The preliminary licence concept
will be detailed by EMRA through forthcoming secondary regulations.
A preliminary licence will cease to be effective, if the licence holder does not:
a obtain the necessary permits, approvals and licences;
b prove that it has obtained the ownership or usufruct right to the area on which
the generation facility will be installed; or
c fulfil its obligations as determined by EMRA.
Furthermore, during the term of the preliminary licence, any change in the direct or
indirect shareholding of the preliminary licence holder, or the occurrence of a share
transfer or any transaction resulting in a share transfer (except by inheritance and
bankruptcy) will lead to cessation of the licence.
According to Temporary Article 11 of the Draft EML, a pending generation licence
application as of the effective date of the Draft EML will be assessed and concluded
as a preliminary licence application. Generation licence holders who are in their preconstruction
period or have not fulfilled their pre-construction period requirements
despite expiry of the pre-construction period under the licence may apply to EMRA
for an issuance of a preliminary licence within one month as of the effective date of the
Draft EML. The term of the preliminary licence for this type of applications will be
the remaining pre-construction period plus an additional three months, and for those
applicants whose pre-construction period had already expired, the licence term will be
limited to the three additional months. If the generation licence holder does not apply to
EMRA for the issuance of a preliminary licence and it cannot fulfil its pre-construction
requirements within one month of the effective date of the Draft EML, its generation
licence will be cancelled and its performance bond that had been provided to EMRA will
be forfeited. Furthermore, a generation licence holder whose pre-construction period
under its licence had already expired and who had not applied to EMRA for issuance
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