Turkish Free Zones :: essays research papers

TURKISH FREE ZONES Free Zones are defined as special sites within the country but deemed to be outside of the customs border and they are the regions where the valid regulations related to foreign trade and other financial and economic areas are not applicable, are partly applicable or new regulations are tested in. Free Zones are also the regions where more convenient business climate is offered in order to increase trade volume and export for some industrial and commercial activities as compared to the other parts of country. With the objective of increasing export-oriented investment and production in Turkey, accelerating the entry of foreign capital and technology, procuring the inputs of the economy in an economic and orderly fashion and increasing the utilization of external finance and trade possibilities, Free Zones Law numbered 3218 was issued in 1985. Since then, - Mersin (1987) - Antalya (1987) - Aegean (1990) - à stanbul Atatà ¼rk Airport (1990) - Trabzon (1992) - à stanbul-Leather (1995) - Eastern Anatolia (1995) - Mardin (1995) - ISE à stanbul International Stock Exchange (1997) - à zmir Menemen-Leather (1998) - Rize (1998) - Samsun (1998) - à stanbul Thrace (ÇATALCA)(1998) - Kayseri (1998) Free Zones became operational. In general all kind of activities can be performed in Turkish Free Zones such as manufacturing, storing, packing, general trading, banking and insurance. Investors are free to construct their own premises, while zones have also available office spaces, workshops, or warehouses on rental basis with attractive terms. All field of activities open to Turkish private sector are also open to joint-venture of foreign companies. INCENTIVES OFFERED IN TURKISH FREE ZONES Turkish Free Zones are tax free zones. Income generated through activities in the Zones are exempted from all kinds of taxes including income, corporate and value-added tax. The validity period of an operation licence is maximum 10 years for tenant users, and 20 years for users who wish to make their own offices in the zone; If the operating licence is for production, these terms are 15 and 30 years for tenant users and investors, respectively. The requested operation licence period can be prolonged to 99 years according to the type of investment. Free Zones earnings and revenues can be transferred to any country, including Turkey, freely without any prior permission and are not subject to any kind of taxes, duties and fees. There is no limitation on the proportion of foreign capital participation in investment within the Free Zones. In contrary to most Free Zones of the world, sales into the domestic market are allowed in Turkish Free Zones.