29.01.2023/25
Support for the Conversion of Foreign-Currency Earnings from Abroad into Turkish Lira
The Communique on Supporting the Conversion of Foreign-Currency Earnings from Abroad into Turkish Lira (NUMBER: 2023/5) was published in the Official Gazette, dated 26.01.2023, issue no. 32085.
With this Communique, the procedures and principles regarding the support to be provided to companies for the conversion of foreign-currency earnings from abroad into Turkish lira by selling them to the Central Bank and converting them into Turkish lira time deposit and participation accounts have been regulated.
1) Support Provided through the Sale of Foreign-Currency Earnings from Abroad to the Central Bank
During the sale of foreign-currency earnings from abroad by companies to the Central Bank via banks, provided that the company commits not to purchase foreign currency for a period determined by the Central Bank, a currency conversion support of 2% of the amount converted into Turkish lira at the conversion rate will be paid to the companies making the commitment.
2) Support Provided for the Conversion of Foreign-Currency Earnings from Abroad into Turkish Lira Time Deposit and Participation Accounts
According to the current practice, under the Export Circular, it is mandatory to sell 40% of export-related foreign currency to the Central Bank.
According to this Communique, for the remaining portion of the 40% sold to the Central Bank:
- It should be converted into Turkish lira time deposit and participation accounts at the conversion rate,
- The company must commit not to purchase more foreign currency than the amount sold to the Central Bank for a period determined by the Central Bank.
Under these conditions, a foreign currency conversion support of 2% of the amount converted into Turkish lira at the conversion rate will be provided to the companies making the commitment.
Additionally, the concept of foreign currency earnings from abroad also includes foreign currency earned by companies in exchange for services provided to foreigners within the country, foreign currency income earned from foreign entities, and foreign currency brought to the country from foreign currency-denominated assets held abroad.
The procedures and principles for both types of support payments will be determined by the Central Bank.
You can access the relevant Communique here.
Best regards,
BİLGENER
