Organized Industrial Zones Under Turkish Law

Author: Atty. Ahmet Berker

I. General Overview

Organized Industrial Zones (“OIZ”) are specially designated and planned areas, fully equipped with infrastructure, allocated to industrial enterprises to enable them to carry out manufacturing activities under suitable and more efficient conditions.

In Türkiye, OIZs are established under the framework of the Organized Industrial Zones Law No. 4562 (“Law”) and the Organized Industrial Zones Implementation Regulation (“Regulation”). These legal instruments govern the establishment, management, and operation of OIZs.

In the context of OIZs, a “participant” refers to natural or legal persons or financial lessees who have been allocated or sold a parcel, who operate or commit to operate on the allocated parcel, and who conduct activities in line with the objectives of the Law.

Similar to their role worldwide, OIZs in Türkiye play a critical role in production, exports, and economic development. Therefore, various advantages are offered to participants to promote manufacturing activities within OIZs.

II. Benefits 

1.  Easy Access To Public and Infrastructure Services

Participants operate in fully zoned areas and are equipped by OIZ administrations with essential infrastructure services such as electricity, water, natural gas, roads, and sewage systems. These services ensure that the physical infrastructure required by industrial enterprises are readily available, facilitating production processes and accelerating operations.

2. Economic Incentives

The Turkish government provides various incentives to businesses operating within OIZs. These include:

• Tax reductions
• Social Security premium support
• Exemptions from real estate taxes
• Waivers on wastewater charges.

Such benefits reduce participants’ costs during the production phase and alleviate their financial burdens.

Beyond exemptions and incentives, participants may also benefit from credit facilities. These credits, provided by relevant ministries or contracted financial institutions, aim to support infrastructure and superstructure projects within OIZs as well as the acquisition of machinery and equipment.

3. Planned Development

OIZs foster planned industrial development schemes, minimizing environmental impacts and promoting sustainable industrial practices.

4. Competitive Advantage

Enterprises in OIZs have the opportunity to establish close relationships with other businesses operating in similar fields. This interaction fosters knowledge-sharing and collaboration, providing a competitive edge.

III. Land Allocation Procedures

Participants wishing to establish enterprises within OIZs must apply for land allocation through the Ministry’s online portal. Applications are ranked according to criteria determined by the Ministry. If the available parcels meet the demand, the OIZ management board shall allocate the parcels at the price set by the OIZ administration.

Once the management board decides on the allocation, the OIZ administration shall inform the applicants in writing within 10 business days. The allocation is finalized upon signing the “Land Allocation Agreement” between the participant and the OIZ administration within 15 days from the date of notification.

IV. Final Thoughts 

In conclusion, Organized Industrial Zones provide a structured and advantageous environment for businesses, facilitating growth, fostering competitiveness, and supporting the sustainable development of industrial activities in Türkiye. Through the many incentives the government provides, operations in these zones have proven to be great assets to businesses.

 

If you would like to know more on this matter or require legal assistance, please contact Berker Berker Law Firm via info@berkerberker.com or any other contact information listed at our website.