Voluntary Participation (IPS) Auto Enrollment System (AES) Funds Legislation Data Center

Consumer Rights

1. Individual Pension System (IPS) and Consumer Regulations

As a supplement to the public social security system, one of the fundamental goals of IPS is to invest individuals’ pension savings and increase their wealth with an additional income during retirement. The system protects participants and investment beneficiaries, allowing them to fully receive the rights arising from the pension contract with regard to pension companies. The Law No. 4632 and the related secondary regulations are devised to comprehensively protect the rights and interests of the IPS participants.

The Consumer Protection Law (CPL) has been issued to take measures in line with public interest to protect the consumer’s health and financial interests, make restitution of their losses, protect them against environmental risks, enlighten them and raise their awareness, encourage self-preserving initiatives, and regulate the voluntary organizations in developing policy in these matters. In Article 49 of the CPL, individual pension services are considered financial services along with all banking services, loan, insurance, investment and payment services. These are protected as per the law.

Since IPS participants are natural person consumers, IPS and consumer legislations shall both be applied. Whichever provides more protection to the consumer shall be considered valid.

2. Comparison of the IPS and Consumer Legislations in Terms of Consumer Rights

The following table provides a summary of the important matters on the IPS and consumer legislations.

IPS Legislation

Consumer Legislation


Notification is mandatory as the method and content format have already been established.

A mandatory notification does not apply with the exception of contracts such as consumer loan contracts, credit sales and mortgage contracts, contracts drawn out of the business, distance contracts for financial services, timeshare and long-term vacation service contracts, and package tour contracts.

Written format

According to the contract type, it shall be approved with an entrance information form or a signed pension contract proposal form, or through secure electronic communication tools.

The statement shall be included in the message that has been sent with a wet-signed contract, confirmed fax or a confirmed remote communication tool.

The consumer shall be provided with a copy of the contract.

The company shall send the pension contract to the participant or, if any, to the sponsor or employer within 10 days of the contract effective date.

The consumer shall be provided with a copy of the contract.

Contract and forms

The format and minimum content of the proposal form, and the other forms relating to the contracts and procedures, have been clearly drawn out in detail in the circular.

The font size used shall be at least 12, and the content shall be provided in a comprehensible, clear, simple and readable manner.

Consumers shall not be asked for additional fees for expenses.

The law and the regulation clearly set forth the type of deductions, upper limits and the circumstances in which deductions can be made. Apart from these, no deductions shall be made from savings, and no fees shall be collected.

As a rule, no additional fees shall be requested from the consumers other than those stated in the contract.

Information on the fees and charges shall be provided in writing in an attachment to the contract.

The deduction items, collection methods, and the related conditions and implementation principles shall be clearly stated in the pension plans, proposal form and the contract. These are the technical principles that set forth the execution method of the pension contract.

The trader or the professional who enters into a contract with the consumer shall be obligated to provide a “separate statement” regarding the fees and charges to be collected.

In consumer transactions, personal guarantees obtained with regard to the consumers’ deeds shall be considered ordinary guarantee.

The IPS legislation does not set forth a special regulation on the guarantee; therefore, general provisions shall apply.

All types of personal guarantees such as joint guarantee, guarantee and debt sharing that may be obtained with regard to the consumers’ deeds shall be considered “ordinary guarantee.” In other words, unless the creditor appeals to the debtor, the issue shall not be escalated to the guarantor.

3. Unfair Terms in Consumer Contracts

The consumer legislation considers it an unfair term when the institutions that enter into a contract with the consumer impose the pre-prepared contracts on the consumer and otherwise refuse to enter into a contract. Namely, an unfair term is when the consumer has no way to object the terms and content of the contract.

The Insurance and Private Pension Regulation and Supervision Agency sets forth the general format and minimum content of the “pension contract” in the IPS legislation. However, in the event of a provision in the pension contract that may be construed as an unfair term, the contract shall become unequivocally invalid.

4. Commercial Advertisement, Misleading Marketing and Unfair Trading Practices

When deciding to purchase a product, consumer and IPS legislations protect consumers against misleading commercial advertisements and unfair trading practices that may impact them by way of commercial advertisements or sales and marketing methods. The IPS legislation goes beyond the protection methods set forth by the CPL and protects consumers through a comprehensive regulation. Accordingly:

  • Companies and individual pension intermediaries shall abide by the following rules in promotion, marketing and sales, public disclosure, and similar activities conducted through all communication tools with regard to the individual pension system and relevant operations.

    • The procedures and principles set by the Ministry of Trade regarding announcements and advertisements shall be respected.
    • No commitments shall be made for things like promotional gifts or additional income that is not part of the pension plans.
    • References that cannot be proven with official data may be used on the condition of showing the source and just to reflect the company’s own status.
    • The numeric data used with regard to the individual pension system or company shall relay the data sent to the Agency or the Capital Markets Board.
    • The announcements and advertisements that are aimed only for a certain group or are valid for a certain period of time shall not appear as permanent practices.
    • No statements, direct or indirect, shall be used to give the impression that the state approves, supports or guarantees the company’s financial standing or the payments made with regard to the system.
    • No statements shall be used to mislead people or impact their pension and investment preferences adversely.
    • No misleading graphics or similar figures shall be used by creating a variation in the scales.
    • The following matters shall be taken into consideration for future projection tables.

      • All proposed deductions in the individual pension system shall be stated in detail.
      • The company’s past investment performance and projected returns from investment tools may be used, on the condition of stating in a clear and understandable way that these projections are not future commitments and are not guaranteed.
      • The statements on returns and other ratios shall be declared in a clear and understandable way to ensure that calculations are made based on net or gross values.
    • Purchase recommendation shall be made according to the person’s needs, financial status, age and risk–return profile. Additionally, individuals shall be informed to help them make decisions about the investment risks of the funds offered in the pension plan.
    • The funds in the pension plan shall not be used in announcements or advertisements before the fund shares have been registered to the Board. In the event of an exclusive announcement and advertisement of the funds in the pension plans, the date and issue of the Trade Registry Gazette, on which the prospectus was published, shall be provided. The presentation of the fund returns shall be conducted in accordance with the procedures and principles that the Capital Markets Board sets forth for its performance and return presentations.
    • The information, documents and forms about the pension contract shall be set forth in accordance with the following matters:

      • Detailed information shall be provided about the company’s title, name and registration number of the individual pension intermediary, name and main features of the pension plan, proposed deductions, and other restricting features.
      • Minimal technical terminology shall be used and additional explanation and definitions shall be provided to prevent any misunderstandings.
  • The announcements and advertisements prepared by the company and the individual pension intermediary shall be numbered and filed by the company and kept for three years for Ministry’s audits. The company approval shall be obtained for the announcements and advertisements prepared by the individual pension intermediary.

5. Examples of Breach of Consumer Rights

Occurrence of one or more of the following circumstances means that your consumer rights have been breached:

  • The proposal form you filled out at the time of purchasing the pension contract does not comply with the minimum requirements set forth in the legislation and does not contain the information that could impact your purchasing decision.
  • You have not been provided a copy of the pension contract in writing or in a data storage unit (SMS, email, internet, disc, CD, DVD, memory card, electronic media accessed using e-Government authentication service and all similar tools and media).
  • Deduction of more contribution than what is stated in your pension contract, excessive deduction, or failure to invest your contributions within the periods stated in the legislation.
  • In distance pension contracts, the provisions of the contract have not given you the opportunity to withdraw within two months of entering, or you have been provided with a withdrawal process harder than that of provided when entering into the contract.
  • The pension company has not fulfilled properly and timely your legislative rights. This may include a fund distribution change, pension plan change, contribution amount change, contribution holiday, pension company change, leaving the system, withdrawal from the system, and so on.

The IPS legislation provides administrative and penal sanctions in the event of financial losses by the participant. Its legislation contains a number of regulations to recover the participant’s losses.

6. Avenues to Claim Rights and the Courts in Charge

You are recommended to go through the following steps in the event your consumers rights have been violated:

Step 1:

First of all, apply to your pension company, the party to your contract, on the grounds that your consumer rights have been violated. You can do so via the company’s call center, or in writing through email, fax or mail. Explain your reasons well, and add to your petition the documents and information that justify your rightfulness. Request the violation of right to be removed.

If your request has not been met, apply to the Pension Monitoring Center by logging in with your e-state password from the “Contact Us” section on our web site or to the Insurance and Private Pension Regulation and Supervision Agency by providing all the relevant information and documents. The parties shall be informed about the conclusion based on the information and documents also provided by your pension company. Click here for a sample petition.

Step 2: Provincial or District Consumer Arbitration Board are in charge of the violation of the right subject to your complaint, in cases where the value is less than 104.000 TL (one hundred four thousand) Turkish Lira in applications to be made for the year 2024. Provincial Consumer Arbitration Board are authorized within the boundaries of the province, and District Consumer Arbitration Board are authorized within the boundaries of the district. In districts where a Consumer Arbitration Board has not been established, the Consumer Arbitration Board determined by the Ministry for that district is authorized. Applications can be made to the Consumer Arbitration Board where the consumer is located or where the consumer transaction is made; However, if a Consumer Arbitration Board has not been established in the district where the application can be made, applications can be made to the district governor's office. Apply via e-state  e-state or personally; If there is an amount over the said amount, contact the relevant Consumer Court. Click here for sample petitions.