June 30, 2022
Turkey's Istanbul Finance Center Law enters into force
Turkey's Law No. 7412 (the Law) regarding the establishment of Istanbul Finance Center (IFC) was published in the Official Gazette on 28 June 2022. The Law was enacted without any changes to the proposed Bill. For more details, see EY Global Tax Alert, Türkiye introduces Istanbul Finance Center, dated 9 June 2022.
Under the Law, participants who operate in the office area, have a participation certificate and perform exportation of financial services, may benefit from the deductions, exemptions and other tax advantages which include:
The Ministry of Treasury and Finance is authorized to make regulations, under which financial institutions operating in the IFC may keep their books and documents in foreign currency, regardless of the provisions of the Tax Procedure Law and the Turkish Commercial Law.
Participants may freely choose a governing law for all kinds of transactions and contracts that they will enter into under private law within the scope of the activities they carry out at the IFC among themselves, provided that it is not contrary to the legislation to which they are subject to.
The Law entered into force on the date of publication in the Official Gazette (28 June 2022).
For additional information with respect to this Alert, please contact the following:
Kuzey Yeminli Mali Müsavirlik A.S., Istanbul
Ernst & Young LLP (United States), Turkish Tax Desk, New York