A law related to marketplace listings introduced in Turkey at the beginning of this month is proving problematic for local marketplaces, which have seen new listings fall by 5%, people familiar with the matter told the AIM Group.
In an effort to prevent the posting of misleading and fake listings, the government has made it mandatory for listers to log in to E-Devlet — its online data system — to verify their identities before listing big-ticket items, real estate and autos.
All marketplaces in the country are gradually integrating with the e-government system to comply with the new law, as they consider it a step in the right direction to improve the quality of listings coming from verified users.
Tolga İdikat, CEO of real estate marketplace EmlakJet, told the AIM Group that regulations would increase the quality and transparency of listings by making both property agents and car dealers accountable for the listings they post.
But he added: “Yet, there is a risk of ads moving from local portals to hard-to-regulate platforms, such as Facebook, Instagram, WhatsApp and so on.”
İdikat estimated a drop of between 5% and 7% in the number of listings in the last couple of weeks — a range that was confirmed by a senior executive at another leading marketplace. “I believe the erosion will go up to 10-15%,” İdikat added.
The most important clause of the bill, he said, was that marketplaces could be fined TRY100,000 (around $3,500 U.S.) for each fake listing.
In terms of autos, Aslı Cora, head of communications and public affairs at digital auto retailer Carvak, said that the the law mainly impacts new car dealers.
In July this year, the country’s Trade Ministry unveiled regulations barring marketplaces from advertising used vehicles at a higher price than “the manufacturer’s or distributor’s recommended selling price” from July 15 until the end of the year.
E-Devlet preventing fake listings
E-Devlet is a portal that provides Turkish residents (regardless of whether they are a citizen or not) with access to various government services — health insurance, tax etc. It can also be used to make payments, such as traffic fines.
Its integration with classifieds marketplaces means that now only a verified private individual or company can advertise rental and for-sale listings of cars and properties.
“I don’t think there is any such law in any other parts of the world,” one senior executive, who wished to remain anonymous, told the AIM Group.
“We are okay with it if the government ensures that foreign platforms [i.e. social media] are also bound by the new rule,” he added.
The regulations have impacted local businesses that are implementing it, he asserted, estimating a 2% drop in active listings in the past two weeks.
“But, what about Facebook and others, which are likely to get off scot-free?” he complained.
Expecting a revisit
The local industry sources we talked to hope that the government will introduce a level-playing field. But it is not ready to give up the penalty clause, an executive who is participating in negotiations with the government told us.
“We are still in the early days of these regulations, and we will understand its implications after some time,” said İdikat.