Electronic Incentive Application and Foreign Capital Information System (E- IAFC)

Electronic Incentive Application and Foreign Capital Information System is an application used in the activities of companies with foreign capital. Here we would like to share some important information about E- IAFC to be a reminder in terms of foreign capital notifications:

E- IAFC is a web-based application where all applications shall be made for the notification of companies and branches with foreign capital established in Turkey to the Ministry of Industry and Technology, and for the issuance of a new investment incentive certificate. Transactions in E- IAFC can be made by identifying the investor or the users who will make transactions on behalf of the investor to the system.

E- IAFC FOREIGN CAPITAL NOTIFICATIONS

It is essential that E- IAFC Foreign Capital Notifications are made on time and in a proper manner. The types of notifications that need to be made and the notification dates are listed below. All these notifications must be made electronically by an authorized person or persons in compliance with the provisions of the relevant legislation.

1.Notification of Activity for Foreign Direct Investments: Notification should be made by the end of May every year. The necessary information, along with the income statement and the balance sheet, must be presented in full.

2. Capital Declaration for Foreign Direct Investments: Should be made no later than one month after the payment made by foreign partners to the capital account. It must be submitted along with other information and documents supporting this process.

3. Notice of Transfer of Shares for Foreign Direct Investments: In case of a change in shares, notification of the mentioned change shall be made within one month, and the notification must be submitted in electronic form along with other documents confirming the transaction.

Article 5 of the Regulation on the Implementation of the Foreign Direct Investment Law, is as follows:

Information to be Requested from Companies and Branches

Article 5 :

a) Companies and branches within the scope of the Law apply for user authorization procedures as specified in the fourth section of this Regulation and carry out their transactions within the framework of the procedures and principles specified.

b) Companies and branches covered by the law,

1) By means of a qualified electronic certificate owner that they have authorized, by logging into the E- IAFC, which is accessible on the Ministry website, within 1 month at the latest after the authorization, "Investor", "Partner List" and "Affiliated Affiliates", if any, to be saved electronically by filling out the information in the field provided.

2) They ensure that the fields in the ANNEX-1 Activity Information Form for Foreign Direct Investments in the E- IAFC regarding their activities are filled in electronically on an annual basis and by the end of May every year.

3) In case of a capital increase or decrease, they fill in the "Partners List" field in the E- IAFC electronically and ensure that it is recorded within 1 month at the latest.

4) If there are any payments made due to capital increase or share transfer, they fill in the fields in the ANNEX-2 Capital Information Form for Foreign Direct Investments in E- IAFC within 1 month following the payment, through the user, and ensure that they are recorded electronically.

5) After the share transfers made by the existing domestic or foreign partners to any domestic or foreign investor among themselves or outside the company, the "Partners List" field in E- IAFC can be entered electronically via the user, within 1 month at the latest following the realization of the share transfer.

As a final note, we would like to point out that it should not be forgotten that Articles 10, 11, 12 and 13 of the "Foreign Direct Investments Law Implementation Regulation" should be examined in terms of notifications.

The content herein is aimed at providing a general insight regarding the subject. For customized circumstances or for further information, please refer to your lawyer.