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This Legal Alert seeks to provide information regarding the amendment of “Regulation for Implementation of Foreign Direct Investment Law” and the rules relating to the newly established Electronic Notification System.
What is Foreign Direct Investment in Turkey?
Foreign Direct Investment in Turkey is regulated by Foreign Direct Investment Law numbered 4875 published in the Official Gazette dated 05/06/2003 (the “Law”), and the Regulation for Implementation of Foreign Direct Investment Law (“Regulation”), published in the Official Gazette dated 20/08/2003 which is more about the implementation of the Law.
Under the Law, “foreign direct investment” in Turkey is defined as,
by Foreign Direct Investors that may be:
The sources of the above-mentioned investments may be cash, equities and other financial sources sustained either from Turkey or from abroad.
Recent amendment under the Regulation
Recent amendment has been made by an amendment regulation published in the Official Gazette dated June 1, 2018. With this amendment, a web-based application named Electronic Information System on Incentive Implementation and Foreign Capital (“E-TUYS” or the “System”) has been established and the companies subject to the Law (the “Company”) have been held liable to submit the company information required by Law through this System.
We would like to note that prior to the recent amendment of the Regulation, the trade registries were responsible for the circulation of the required information of the Companies with the relative Ministry of the Republic of Turkey.
With the amendment, the procedures that shall be followed by Foreign Direct Investors are as follows:
We would like to note that the details of such requested information under these sections may be seen when the System has been accessed by the Representative.
As a final note, the newly established System brings practicality and a statistical advantage in recording and monitoring the information relating to Foreign Direct Investments in Turkey in connection with their operations, shareholding structure and other legally requested information via a web-based application.