REAL PROPERTY ACQUISITION OF FOREIGNERS IN TURKEY

DIRECTORSHIP OF FOREIGN AFFAIRS OFFICE

Article 14- Duties of Directorship of Foreign Affairs Office:

-Following, regulating and archiving every kind of land registry and cadastre transactions related to real estate located in Turkey which are owned by real and legal persons of foreign nationality and persons having nationality of the Republic of Turkey but residing abroad.
-Making cooperation with relevant ministries and institutions in order to protect rights and interests concerning real estate located abroad and owned by real and legal persons having nationality of the Republic of Turkey,
-Collecting documents exclusive to its activity field for international real estate negotiations related to meetings among ministries and institutions.
-Performing similar duties given by the General Directorate.

I.REAL ESTATE ACQUISITION OF FOREIGNERS IN TURKEY

It is stated in the article 12 of the Constitution of the Republic of Turkey that every person has individual, inviolable, untransferable, unrenouncable fundamental rights and freedoms, and it is expressed in the article 16 that fundamental rights and freedoms can be restricted for foreigners by law in accordance with international law. It is also accepted in the article 1 of the Protocol numbered 1 of the European Human Rights Convention that property rights of foreign persons can be restricted in conformity with general principles of international law.

I.A.REAL ESTATE ACQUISITION OF FOREIGN REAL PERSONS IN TURKEY

Real estate acquisition of foreign real and legal persons has been regulated in the article 35 of the Land Registry Law numbered 2644 that was modified by the article 19 of the Law numbered 4916 and dated July 3, 2003. By this amendment new regulations have been introduced concerning real estate acquisition, in our country, of real persons of foreign nationality and trade companies having legal personality and established in foreign countries according to the laws of these countries, and article 36 of the Land Registry Law was abrogated and its content was added to the article 35. Besides, the article 87 of the Village Law numbered 442 was completely abrogated.

New form of the article 35 of the Land registry Law is as follows:

"With the reservation of being reciprocal and complying with legal restrictions, real persons of foreign nationality and trade companies having legal personality established in foreign countries according to the laws of these countries, can acquire real estate within the boundaries of the Republic of Turkey. In implementation of reciprocity principle, it is essential that real estate acquisition rights given by a foreign country to its own citizens and to trade companies established in foreign countries according to the laws of these countries, are also given to the citizens and trade companies of the Republic of Turkey.

Real estate acquired through legal inheritance by citizens of a country that does not have reciprocity with Turkey and real estate located in the areas subjected to legal restrictions, are liquidated after being transferred by inheritance and converted to its value.

Real estate acquisition of real persons of foreign nationality and trade companies having legal personality and established in foreign countries according to the laws of these countries, more than thirty hectares, depends on permission of the Council of Ministers. This provision is not implemented for real estate transferred by the way of legal inheritance. Real estate acquisition of real persons of foreign nationality more than thirty hectares through transactions depending on death apart from legal inheritance is also subjected to permission of the Council of Ministers. If permission is denied, the exceeding part is converted to value by means of liquidation.

In case of registration of limited real right on real estate in favor of real persons of foreign nationality and trade companies having legal personality and established in foreign countries according to the laws of these countries, reciprocity principle is not stipulated.

With regard to public interest and state security, the Council of Ministers is authorized to determine where this article will not be implemented."

I.A.1.RECIPROCITY PRINCIPLE

The Council of Ministers expressed what should be understood from the reciprocity principle in its decision dated May 29, 1940 and numbered 2/13394. According to this decision, in addition to legislative regulation of reciprocity principle, practical applicability of it is also required for its existence. By this decision, in which it's taken into consideration that reciprocity in law will not indicate actual situation, restrictions encountered in a foreign country by the citizens of the Republic of Turkey, in case of their application, are wanted to be taken as a basis in implementation of reciprocity. Therefore, for the existence of reciprocity between our country and a foreign country about real estate acquisition, reciprocity must be both in law and in practice. According to this principle, for real estate acquisition of a foreign country's citizen or trade company in our country, the citizens and trade companies of the Republic of Turkey should also have the right to acquire real estate in this foreign country and this right must be accepted by laws and must be practically applicable.

In the new regulation, instead of exact equivalent implementation of reciprocity principle, it's stipulated that the rights given by a foreign country to its own citizens or trade companies having legal personality and established according to its own laws, should also be given to citizens and trade companies of the Republic of Turkey.

Today, in terms of real persons, countries that have (annex-1) and do not have (annex-2) reciprocity between our country are listed at the end of this text. The demands of citizens of countries that are not involved in these lists will be concluded by consulting the General Directorate.

I.A.2.EXCEPTIONS OF RECIPROCITY PRINCIPLE

Although the first condition is reciprocity for real estate acquisition of foreign real persons in our country, reciprocity principle has some exceptions in terms of real persons. These exceptions are as follows:

a. Since haymatlos persons have no state citizenship, there isn't any state to decide about reciprocity. For this reason, haymatlos persons are exempted from reciprocity principle.
b. According to the article 7/2 of "Convention on Legal Situation of Refugees" dated July 28, 1951 and ratified by Turkey with the law dated August 26, 1961 and numbered 359, the refugees are exempted from reciprocity principle in a country after three years of residence. The refugees in Turkey are also subjected to the same provision. It is enough for refugees to prove this situation with an official document for exemption.
c. According to the article 8/E of the Law for Encouragement of Tourism numbered 2634, foreign real and legal persons who want to make investment for tourism objective in Turkey, can acquire real estate by the decision of the Council of Ministers in tourism areas and centers being exempted from reciprocity principle and restrictions formulated for foreigners.

I.A.3.LEGAL RESTRICTIVE PROVISIONS

The second condition for real estate acquisition of foreign real persons in our country is to comply with restrictive provisions involved in law. Some restrictions are involved in our laws concerning real estate acquisition of foreigners. These restrictive provisions are as follows:

a. According to regulations involved in the Military Forbidden Zones and Security Zones Law numbered 2565 which restricts geographically real estate acquisition of foreigners in our country, it is not possible to sell, transfer and rent real estate located within military forbidden zones and security zones, to foreign real and legal persons.
b. According to the article 35 of the Land Registry Law numbered 2644, foreign real persons can not acquire real estate more than thirty hectares in our country, however for acquisition of more than thirty hectares, decision of the Council of Ministers is required. Legal inheritance is exception of this rule.
c. Since the article 87 of the Village Law numbered 442, was repealed by the new regulation it is possible for foreign real persons to acquire real estate in villages.

I.B.REAL ESTATE ACQUISITION OF FOREIGN LEGAL PERSONS IN TURKEY

By the amendment in the article 35 of the Land Registry Law, the right to acquire real estate in Turkey was given to all foreign trade companies on condition of being reciprocal and complying with legal restrictive provisions.

Conditions of being reciprocal and complying with legal restrictions are also valid for foreign trade companies, as it is for foreign real persons. Whether there is reciprocity between our country and a foreign country in terms of trade companies, is determined by consulting the Ministry of Foreign Affairs.

Provisions that are valid for foreign real persons in terms of legal restrictions are also valid for foreign trade companies. Furthermore the rule which involves that reciprocity will not be stipulated when a limited real right is registered in favor of foreign real persons, is also formulated for foreign trade companies.

I.C.REAL ESTATE ACQUISITION OF FOREIGN CAPITAL COMPANIES

The expression of "foreign capital companies" is usually confused with the expression of "foreign company".

First of all, it should be stated that "foreign capital companies" are established according to the provisions of the Turkish Trade Law in Turkey and enrolled in Turkish Trade Register. In other words, these countries are subjected to the legal provisions of the Republic of Turkey. Only, the whole or part of their capital belongs to foreign real and legal persons. Availability of foreign shareholders within the company will not include it within the status of foreign legal personality; because nationality of the company and nationality of its shareholders are different matters.

The Law for Encouragement of Foreign Capital numbered 6224 and dated January 18, 1954 was repealed by Foreign Direct Investment Law numbered 4875 and dated June 5, 2003 that entered into effect being published in the Official Gazette numbered 25141 and dated June 17, 2003, new provisions were adopted to encourage and increase foreign direct investments, to protect rights of foreign investors, and to transform permission and ratification system to informative systems in realization of foreign investments.

With regard to the subject, a circular numbered 1363-100/841 and dated August 7, 2003 was announced to all our units through our regional directorates and it was stated that implementation would be carried out within the framework of the following statements.

By the Foreign Direct Investment Law numbered 4875, foreign investors are subjected to equal treatment with domestic investors; permissions and ratifications like investment permissions, company establishment permissions, were removed. Moreover, companies having legal personality that foreign investors participate in or establish, in our country, are allowed to acquire real estate or limited real rights in areas where acquisition of these rights is allowed for Turkish Citizens.

Companies established according to the repealed Law numbered 6224 or that will act according to the Law numbered 4875 which is about the activities of foreign capital companies in our country, are considered as companies of the Republic of Turkey, according to criteria of establishment place or administration center. For this reason, real estate acquisition and other demands concerning land register of foreign capital companies that either obtained activity permission according to the repealed Law for Encouragement of Foreign Capital or will act according to the Foreign Direct Investment Law numbered 4875, are concluded by relevant Land Registry Offices implementing the same methods and rules as for companies established according to the Turkish Trade Law, after examining authorization documents given by the Trade Register Authorities that indicate the competent person and competence for real estate acquisition of the company.

II.TRANSFER

It is free to transfer through banks and private financial institutions, revenue and value of sale earned from real estate and real rights acquired by foreigners with or without exchange of foreign currency.

III.AUTHORITY OF APPLICATIONS

By the article 26 of the Land Registry Law numbered 2644, the duty and authorization to regulate contracts concerning property and real rights excluding property were given to Land Registry Offices.

Foreigners who want to acquire real estate or benefit from real rights apart from property will make their applications to the Land Registry Office where the real estate is located.

Detailed information about the subject can be provided from the General Directorate of Land Registry and Cadastre.

Address:

Tapu ve Kadastro Genel Müdürlüğü
Yabancı İşler Dairesi Başkanlığı
Dikmen Yolu-ANKARA

Tel:(312)418 98 00(Director)
(312)417 12 60/219-356-231
 

ANNEX1:

1. ANDORRA
2. ARGENTINA
3. AUSTRALIA
4. AUSTRIA
5. BAHAMAS
6. BANGLADESH
7. BARBADOS
8. BELGIUM
9. BELIZE
10. BENIN
11. BOLIVIA
12. BOSNIA-HERZEGOVINA
13. BOSTWANA
14. BRAZIL
15. CAMEROON
16. CANADA
17. CAPE-VERDE
18. CENTRAL AFRICAN REPUBLIC
19. CHILE
20. COLOMBIA
21. COSTA RICA
22. COTE D'IVOIRE
23. CROATIA
24. DENMARK
25. ECUADOR
26. EL SALVADOR
27. ENGLAND
28. ESTONIA
29. FINLAND
30. FRANCE
31. GABON
32. GERMANY
33. GHANA
34. GUINEA
35. GRENADA
36. GUATEMALA
37. GUYANA
38. HAITI
39. HONDURAS
40. HUNGARY
41. IRELAND
42. ISRAEL
43. ITALY
44. JAMAICA
45. JAPAN
46. KOREA,SOUTH
47. LATVIA
48. LIECHTENSTEIN
49. LITHUANIA
50. LUXEMBOURG
51. MALAWI
52. MALAYSIA
53. MALI
54. MALTA
55. MAURITANIA
56. MAURITIUS
57. MEXICO
58. MONACO
59. MOZAMBIQUE
60. NETHERLANDS
61. NEW ZEALAND
62. NICARAGUA
63. NIGERIA
64. NORWAY
65. PANAMA
66. PARAGUAY
67. PERU
68. PHILIPPINES
69. POLAND
70. PORTUGAL
71. SAN MARINO
72. SENEGAL
73. SINGAPORE
74. SOMALIA
75. SOUTH AFRICAN REPUBLIC
76. SRI LANKA
77. SPAIN
78. SWAZILAND
79. SWEDEN
80. SWITZERLAND
81. TANZANIA
82. THE REPUBLIC OF DOMINIC
83. TURKISH REPUBLIC OF NORTHERN CYPRUS
84. UNITED STATES OF AMERICA
85. URUGUAY
86. VENEZUELA
87. YUGOSLAVIA(SERBIA-MONTENEGRO)

ANNEX - 2

1. AFGHANISTAN
2. ALGERIA
3. ARMENIA
4. BAHRAIN
5. BURMA
6. CAMBODIA
7. CUBA
8. CZECH REPUBLIC
9. ERITREA
10. ETHIOPIA
11. FIJI
12. ICELAND
13. INDIA
14. INDONESIA
15. IRAQ
16. KOREA,NORTH
17. KUWAIT
18. LAOS
19. LIBYA
20. MALDIVES
21. MONGOLIA
22. NEPAL
23. NIGER
24. OMAN
25. PAPUA NEW GUINEA
26. QATAR
27. SAUDI ARABIA
28. SLOVAKIA
29. SUDAN
30. SURINAME
31. THAILAND
32. TUNISIA
33. UNITED ARAB EMIRATES
34. VIETNAM
35. YEMEN

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