’Pure and simple attack on press in Turkey’
Güncelleme Tarihi:
Hürriyet Daily News
OluÅŸturulma Tarihi: Åžubat 19, 2009 00:00
ISTANBUL - The Treasury imposes a half-billion-dollar levy against the Doğan Media Group, parent company of Hürriyet Daily News & Economic Review, as the government effectively carries its war against the media to a new level. ’This is the levy of a fine against freedom of press,’ says Vuslat Doğan Sabancı, chief executive of Hürriyet.
A nearly half-billion-dollar levy imposed late Monday by Treasury officials on the parent company of the Hürriyet Daily News & Economic Review was characterized yesterday by the paper’s publisher as a blatant government attack on freedom of the press.   Â
The order to DoÄŸan Media Group, or DMG, to pay 826.3 million Turkish Liras, or $490 million, came to light yesterday in a filing by DMG to the Istanbul Stock Exchange. It results from alleged carriage of receipts from a 2006 sale, of a 25 percent share in DoÄŸan TV to a German media group, into 2007 as a means to avoid taxation.
"This is the levy of a fine against freedom of the press," said Vuslat Doğan Sabancı, the chief executive officer of the Daily News and parent newspaper Hürriyet. "This has nothing to do with taxation." Government officials reportedly reason that a memorandum of understanding featuring tentative sales terms of 375 million euros in November 2006 amounted to tax evasion after the regulator-required due diligence process pushed the sale into January 2007. The closing memorandum, which triggered the transfer of shares and payment from Germany into a Turkish bank, occurred on Jan. 2, 2007 -- the date the final sales agreement was executed.
While DMG paid a sum of some 30 million liras in accordance with tax rules on that date, the Treasury order alleges that the due diligence timetable was part of a plan for deliberate fraud.
DMG Chief Financial Officer Soner Gedik said the charges are baseless and without logic. First, he said, had the payment been made in 2006 under terms seen as proper by the Treasury, this would have violated Turkish commercial code restrictions on fund transfers in the absence of share transfers. He further noted that even if one assumed a sale executed in December rather than January, the total additional tax bill and any penalties would not be more than 4 million liras.
"Through this charge of fraud compounded by an allegation of criminal intent, plus the adding of interest and cleverly-constructed penalties, the levy the government is seeking to impose is on the order of 800 million liras," Gedik said. "This is on a sale agreed between two publicly-traded companies made under the scrutiny of German and Turkish regulators and under the due diligence regulations of both countries."
The Treasury offered no explanation or defense of its reasoning in the case yesterday. Doğan Sabancı said what is at work is clear, noting the government last summer took even such drastic steps as demanding a boycott of all Doğan newspapers after Prime Minister Recep Tayyip Erdoğan characterized as "lies" the report of a politically allied charity in Germany convicted of fraud. "For about 12 months, simultaneous investigations have been going on in Doğan companies, including our media companies. Yesterday, we learned of this assessment which is totally baseless, reprehensible and unprecedented in Turkish history," said Doğan Sabancı, a member of the International Press Institute. "This is a pure and simple attack to put pressure on our reporting and on freedom of the press in Turkey."
Daily News is a DoÄŸan Media Group publication.
The order to DoÄŸan Media Group, or DMG, to pay 826.3 million Turkish Liras, or $490 million, came to light yesterday in a filing by DMG to the Istanbul Stock Exchange. It results from alleged carriage of receipts from a 2006 sale, of a 25 percent share in DoÄŸan TV to a German media group, into 2007 as a means to avoid taxation.
"This is the levy of a fine against freedom of the press," said Vuslat Doğan Sabancı, the chief executive officer of the Daily News and parent newspaper Hürriyet. "This has nothing to do with taxation." Government officials reportedly reason that a memorandum of understanding featuring tentative sales terms of 375 million euros in November 2006 amounted to tax evasion after the regulator-required due diligence process pushed the sale into January 2007. The closing memorandum, which triggered the transfer of shares and payment from Germany into a Turkish bank, occurred on Jan. 2, 2007 -- the date the final sales agreement was executed.
While DMG paid a sum of some 30 million liras in accordance with tax rules on that date, the Treasury order alleges that the due diligence timetable was part of a plan for deliberate fraud.
DMG Chief Financial Officer Soner Gedik said the charges are baseless and without logic. First, he said, had the payment been made in 2006 under terms seen as proper by the Treasury, this would have violated Turkish commercial code restrictions on fund transfers in the absence of share transfers. He further noted that even if one assumed a sale executed in December rather than January, the total additional tax bill and any penalties would not be more than 4 million liras.
"Through this charge of fraud compounded by an allegation of criminal intent, plus the adding of interest and cleverly-constructed penalties, the levy the government is seeking to impose is on the order of 800 million liras," Gedik said. "This is on a sale agreed between two publicly-traded companies made under the scrutiny of German and Turkish regulators and under the due diligence regulations of both countries."
The Treasury offered no explanation or defense of its reasoning in the case yesterday. Doğan Sabancı said what is at work is clear, noting the government last summer took even such drastic steps as demanding a boycott of all Doğan newspapers after Prime Minister Recep Tayyip Erdoğan characterized as "lies" the report of a politically allied charity in Germany convicted of fraud. "For about 12 months, simultaneous investigations have been going on in Doğan companies, including our media companies. Yesterday, we learned of this assessment which is totally baseless, reprehensible and unprecedented in Turkish history," said Doğan Sabancı, a member of the International Press Institute. "This is a pure and simple attack to put pressure on our reporting and on freedom of the press in Turkey."
Daily News is a DoÄŸan Media Group publication.