Investors eligible for free lots in Turkish industrial zones
ANKARA – Radikal | 9/23/2010 12:00:00 AM |
The Ministry of Industry and Commerce has announced it will allocate any investor beginning a new venture employing 10 or more people the free use of an industrial zone lot.
The Ministry of Industry and Commerce has announced it will allocate any investor beginning a new venture employing ten or more people the free use of an industrial zone lot.
The Cabinet is yet to decide which cities the new incentive will apply to, and the overall cost of the lots will be cut from existing loan agreements between the ministry and industrial zones. The incentive will be valid for two years but the Cabinet will be able to prolong it to four if it is deemed a successful policy.
According to a draft seeking to modify industrial zone law, investors will be granted the use of industrial zone lots free of charge, with experts saying the proposal is similar to a previous incentive which operated under law 5084, which applied to 49 provinces and ended only recently. Experts agree that the similarities between the policies suggest that the new incentive might as well apply to the same 49 provinces.
According to the 7th article of the draft, the incentive will be put into practice in two ways. In the first the ministry will pay for the lots by receiving reduced loan repayments from industrial zones. The loans themselves are provided by the ministry so the industrial zones are able to flexibly establish their own infrastructure.
The second way will require determining how those industrial zones that have not yet received ministerial loans will benefit from the incentive. Industrial zones that have not received the loan or have already repaid their loan will also be allowed to award lots to investors under the same incentive under the consent of authorities. In which case, the cost of the lot will be paid by the state treasury.
[HH] Violation of terms will void deal
If investors violate the terms of the incentive, or if they do not finalize the investment within an agreed timeframe, the lot allocation will be annulled without the requirement of any judicial decision.
In this case all establishments and facilities on the property will be transferred to industrial zone management. The forfeiture of such facilities will leave investors with no recourse to demand compensation or reimbursement.
However, if investors have finalized at least 50 percent of the investment within agreed timeframes, the venture will be able to remain on site, with the monetary amount of the original investment to be returned to the investor by whoever takes over the property when he or she vacates it.
Such payments will be mediated by industrial zone management.
The Cabinet is expected to announce a regulation concerning the application of the law soon.