Istanbul Financial Center, as its counterparts, planned as a service infrastructure to provide the investors and institutions with the technical opportunities such as the physical and technological infrastructure and superstructure, as well as with the factors facilitating business such as the legislation responding to the current needs, competitor tax rates and trained human resources and initiative and research components such as the incubation center, laboratory, and academy. Istanbul Finance Center is designed to make Istanbul one of the leading international financial centers by attracting the international financial institutions to Türkiye by promising with its multilayered and functional structure spread over 3.4 million square meters, a transparent, productive, and predictable management order through a centralized performance of management, leasing, security, maintenance and cleaning services and services for meeting the daily needs of approximately 100.000 employees and visitors. With the establishment of Istanbul Financial Center, it is evaluated that by the year 2036, Istanbul Financial Center will increase the total financial services export of Türkiye approximately 3 times.

In Istanbul Financial Center, in addition to focusing on the strategic sub-sectors such as the banking, insurance, sustainable finance, financial technologies and participation finance, the supporting of the portfolio management, wealth management, project finance, fund management and reinsurance companies operating within the international financial services sector is also aimed.

Istanbul Financial Center bill is currently under consideration of Turkish Grand National Assembly. In the draft bill on Istanbul Finance Center, principally, the deduction, exemption and other tax advantages and other incentive mechanisms such as conveniences for attracting qualified human resources are introduced. In line with the proposed bill, Istanbul Financial Center is designed as two different sections as office area in which the financial institutions will operate and out of scope area including the commercial and social units in which the employees will meet their daily needs. While the opportunity to benefit from the deduction, exemption and other tax advantages stipulated in the Bill is conditioned to taking part in the office area by obtaining the certificate of participant and performing the financial services export, in terms of benefiting from the regulations for attracting qualified human resources, taking part in the office area by obtaining a certificate of participant is deemed sufficient.

The draft bill with the aim of making Istanbul to become one of the leading international financial centers, determining the boundaries of Istanbul Financial Center and scope of the Law as to increase the financial competitiveness of Türkiye as to support the economic growth, to contribute to the instrument diversity and depth in the finance and capital markets, to create the necessary infrastructure for the performance of the financial activities carried out abroad within Türkiye, to develop the participation finance sector and to increase the integration to the international markets, to adapt to the innovations emerging in the finance markets in accordance with the technological developments and to ensure the management of the activities of the foreign credit institutions or financial institutions and organizations and other natural persons and legal entities and ordinary partnerships in the countries in the region within the country.

In the with the draft bill, to ensure a centralized management, the works and transactions for the operation and management of the entire infrastructure and superstructure in Istanbul Financial Center and leasing of the independent sections within the boundaries of the region will be carried out by a joint-stock company established for this purpose by Türkiye Wealth Fund for a period of 20 years.

In the Istanbul Financial Center, all types of public permissions, licenses and similar approval applications required by relevant legislation concerning the activities of the participants taking part in Istanbul Financial Center and also public permission and approval applications for their employees and dependents of these relevant employees will be facilitated smoothly and easily through a “one stop office”.

On condition that the service is ultimately utilized abroad, the financial services provided to those residing abroad by the institutions carrying out financial activities by obtaining the certificate of participant, shall be deemed as the financial services export. Within this respect in the draft bill, it is regulated that 75% of the income generated within the framework of the financial services export shall be deducted from the profit of company in the corporate tax assessment.

Additionally, in order to reduce the transaction costs and to ensure the competitiveness of the participants, it is ensured that only their activities within the framework of the financial services export and moneys received in favor due to these relevant activities shall be exempted from the banking and insurance transaction tax. Moreover, it is ensured that the activities of the participants within the framework of the financial services export and papers issued within this framework shall be exempted from the stamp tax and duties. To attract qualified human resources, 60& of the real net value of the wage shall be exempted from the income tax for those who have at least five years of professional experience abroad and 80% of the real net value of the wage shall be exempted from the income tax for those who have at least ten years of professional experience abroad. However, this exemption will not be applicable to the wage income of the personnel who have worked in Turkey during the last three years before starting to work in Istanbul Financial Center. The work permit applications of foreign personnel, in the respect, shall be deemed as exemption within the framework of Article 16 of the Law No. 6735. Finally, leasing transactions of the immovable properties in Istanbul Financial Center shall be exempted from all types of duties and the papers issued for these relevant transactions shall be exempted from the stamp tax.

In Istanbul Financial Center, the participants shall be able to keep the legal books and documents in foreign currency, notwithstanding the provisions of the Tax Procedure Law No. 213 and Turkish Commercial Code No. 6102. Moreover, the participants operating in Istanbul Financial Center shall be free to keep records in the foreign language required by the international institutions and shall be free to choose the law in all types of transactions and contracts subject to the private law within the framework of their activities carried out in Istanbul Financial Center on condition of not violating the provisions of the legislation to which the relevant participants are subject.