The Law guarantees foreign investors national treatment, protection against expropriation save where carried out in accordance with the law, the free transfer of profits and sale proceeds, and access to arbitration alongside the national courts in disputes. Investment data is reported through E-TUYS; the basis is notification, not authorisation.
Overview
Law No. 4875, the Foreign Direct Investment Law, is the framework regulation that liberalised Türkiye’s foreign capital regime. It replaced the pre-investment permit system with a notification basis and tied the foreign investor’s legal status to guarantees.
Core guarantees
The law has three pillars: national treatment (the foreign investor is subject to the same conditions as a domestic investor), protection against expropriation (only where the public interest requires it and against payment of compensation) and freedom of transfer (the free transfer abroad of profits, dividends, sale and liquidation proceeds). In disputes, the route to international arbitration is open where its conditions are met.
The notification regime
Companies with foreign capital notify their incorporation, share transfers and capital changes through E-TUYS. This is not a permit process; however, incomplete notification creates friction in incentive and statistics procedures. Separate procedures apply to structures such as branches and liaison offices.
Key point for investors
Law No. 4875 is a general framework; sector-specific rules are reserved. In areas such as energy, finance, healthcare and media, separate permit and shareholding-cap regimes apply — structuring must be planned together with this layer.
Roadmap
Entity-type selection according to the investment model (joint-stock or limited company [A.Ş./Ltd.], branch, liaison office); tax and incentive planning; the shareholders’ agreement; E-TUYS and trade-registry procedures; and, where necessary, the timeline for sector-specific permits. Carrying out these steps within a single plan reduces both the incorporation time and the risk.
Practical notes
Law No. 4875 is not a penalty statute; the practical risks lie in record-keeping discipline: delays in E-TUYS notifications create friction in incentive and statistics procedures, and a lack of documentation for capital movements later gives rise to evidentiary problems in profit transfers and capital increases. The sector-specific permit regimes (energy, finance, healthcare, media) are exceptions to the law’s general freedom and should be screened before structuring.
Related content
For the incorporation steps, see our guide to company formation in Türkiye, and for the incentive window, our investment incentive certificate guide. The full strategy is in our Expansion into Türkiye focus.
