As of 18 May 2012,reciprocityfor
foreigners who want to acquire real property in Turkey has been
Requirements for acquisition of real property by
The Turkish Constitution (TC) states, "Everyone has the
right to own and inherit property. These rights may be limited by
law only in view of the public interest. The exercise of the right
to property shall not contravene the public interest."
Accordingly, some restrictions on the acquisitions of real
property and limited rights in rem over real property by
foreigners are regulated under Articles 35 and 36 of Act No. 2644
(TDA), subject to compliance with the legal restrictions.
Recently, new regulations on acquisitions by foreign investors
have doubled the number of acquisitions in Turkey.
Past regulations restricting foreigners from investing
In the recent past, due to the reciprocity requirement
(abolished through new regulations), the right to acquire real
property in Turkey was granted only to those buyers who belonged to
countries that had granted the same privilege to Turkish citizens.
This was a strong barrier to the acquisition of real property by
foreigners in Turkey. Many investors had to cancel their investment
plans due to this restrictive regulation.
The main restrictions and limitations were as follows.
Reciprocity requirement between Turkey and the respective
Foreign real persons (FRP) can acquire real estate in Turkey
that is registered for residential or business purposes in
development plans with the reservation of reciprocity and
compliance with national laws regarding military and special
security areas. Those who cannot meet the reciprocity requirement
may not acquire real property or be granted limited rights in
rem in Turkey.
Limitation in area
The total area of real property that a FRP can acquire may not
exceed 10% of the area within the borders of development plans in
each city, and the total area of the real property may not exceed
25,000 m2 in total for the whole country.
The new regulations attract foreign investors
Amendment No. 6302 (Amendment) has amended the TDA as of 3 May
2012, with the aim to reduce the restrictions on acquisition of
real property in Turkey by foreigners.
The Amendment sets restrictions on the real property acquisition
rights of foreigners by categorising foreign persons.
As of the Amendment's effective date, the total area of real
property and limited rights over real property that an FRP can
acquire throughout the country may not exceed 300,000 m2.
Specifically, this area may not exceed 10% of the country where the
respective property is located. But the Council of Ministers (CoM)
may increase this size up to 600,000 m2 if it is in the public
interest. CoM determines which countries' citizens are allowed
to acquire real property in accordance with the limitations under
Foreign legal entities
Under the Amendment, foreign legal entities (entities
incorporated and operating under the laws of foreign countries) may
also acquire real property and limited rights in rem over
real property in accordance with provisions of certain laws, such
as Act No. 2634 on Tourism Encouragement and Act No. 4737 on
Industrial Zones. Other companies not subject to certain laws may
not acquire real property or obtain limited rights in rem
over real property, except for establishing mortgages in their
Foreign capital companies (FCC)
FCC (foreign shareholders own at least 50% of shares or have the
authority to assign or dismiss the majority of managers)
established in Turkey may freely acquire and use real properties to
conduct business activities listed in their Articles of
FCC wishing to acquire real property or limited rights in
rem in Turkey must apply to the governorship where the real
property is located, by presenting the required documents for their
approval. To grant the approval, the Governorship must determine
whether the real property is in a military forbidden zone or a
military security zone. If so, the Governorship will not approve
There is no need to obtain approval from the Governorship to
establish mortgages in favour of foreign capital companies.
The changes to the regulations will significantly increase
acquisitions by foreign investors who are planning to expand their
business in a country open for development. Because of these new
regulations, Turkey, with its strategic position, has the
opportunity to become a key area of interest.
Quote:New regulations on the
acquisition of real property by foreign investors have doubled the
number of such acquisitions in Turkey.
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