Foreign Currency Requirement In Property Acquisition By Foreigners

Recent Development:

The Central Bank of the Republic of Turkey ("CBRT") has introduced the obligation to exchange foreign currency for immovable property acquisitions of which foreign real persons are the buyers by its amendment of the Capital Movements Circular ("Circular"). The CBRT also published the Implementation Instruction on the Sale of Foreign Currencies to the CBRT for Article 13 of the Circular ("Instruction") to influence the amended Circular's implications in practice.

What do the Circular and the Instruction state?

By the amendment of the Circular:

• The payment obligations in relation to real estate acquisitions of non-Turkish citizens will need to be made using foreign currencies. However, before a transaction takes place, the foreign currency should be sold to a bank by providing information on the property purchase, and the payment to the seller should be made in Turkish liras.