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Amendments to Decree No. 32 Regarding the Protection of the Value of the Turkish Lira

I. Introduction

The Council of Ministers’ has recently adopted changes to Decree No. 32 Regarding the Protection of the Value of the Turkish Lira (“Decree No. 32”) which governs the general currency control and capital flows regime of the Republic of Turkey.

The amending decision (the “Amending Decision”), published in the Official Gazette numbered 30312 and dated 25 January 2018, introduces various limits and restrictions to the use of foreign currency and currency-indexed loans by Turkish residents effective as from 02 May 2018 (the “Effective Date”).


II. Limits and restrictions

Currency indexed loans

The Amending Decision provides that Turkish residents, both natural and corporate, will not be permitted to utilise currency-indexed loans following the Effective Date. This will apply to loans from domestic sources as well as foreign, effectively constituting a categorical restriction on all indexed loans made in or to Turkey.

Foreign currency loans by natural persons

The Amending Decision provides a similar, categorical restriction on the use of foreign currency loans by natural persons in Turkey. According to the Amending Decision, natural persons residing in Turkey will not be permitted to utilise foreign currency loans from domestic or foreign sources after the Effective Date.

Foreign currency loans by corporates

The Amending Decision also, and perhaps most importantly, introduces limitations on foreign currency borrowings by corporations and other legal entities.

Following the Effective Date, Turkish corporates will be able to take on additional foreign currency exposure only if, at the time of incurrence, their aggregate “foreign currency credit balance” is equal to or greater than USD15 million or they have sufficient foreign currency income or benefit from one of the other, relatively limited and specific exemptions provided by the Amending Decision (primarily relating to public-private-procurement projects and international tenders).


To summarise the new regime as from the Effective Date is provided below:

Type of borrowing:

Foreign currency loan (domestic/foreign)



- foreign currency credit balance >=US$15m.; OR

- has foreign currency income (and in this case, up to an aggregate  foreign currency credit balance not exceeding the sum of last three years’ foreign currency income); OR

- other specific exemption applies.

Natural persons

Not permitted


Type of borrowing:

Currency indexed loan (domestic/foreign)


Not permitted

Natural persons

Not permitted


For more information:

Yeşim Bezen T. +90 212 366 6804 E. [email protected]

Murat Soylu T. +90 212 366 6802 E. [email protected]

Can Özilhan T. +90 212 366 6811 E. [email protected]

Nazlı Özkul T. +90 212 366 6853 E. [email protected]