Introduction
In recent years, economic relations between Turkey and Dubai (United Arab Emirates – UAE) have grown significantly.
The increasing flow of investment, trade, and financing between the two countries makes it necessary to take into account a dual legal regime in banking, credit transactions, international payment systems, and investment law.
In this article, we examine the legal framework of finance and banking relations between Dubai and Turkey, relevant legislation, and key practical considerations.
1. Legal Framework
1.1 Turkish Legislation
- Banking Law No. 5411 – Governs licensing, supervision, and capital adequacy of banking activities.
- Turkish Commercial Code (TCC) – Commercial provisions for financial agreements.
- Turkish Code of Obligations (TCO) – Provisions on loan, collateral, and surety agreements.
- Turkish Foreign Exchange Protection Regulations – Foreign currency transfers, exchange control rules.
- Capital Markets Law – Securities offerings and investment funds.
1.2 Dubai and UAE Legislation
- UAE Central Bank Law – Licensing and supervision of banking institutions.
- Federal Commercial Companies Law – Corporate structures for financial institutions.
- Dubai International Financial Centre (DIFC) Law – Special legal framework for international finance and investment transactions.
- Anti-Money Laundering (AML) Regulations – Prevention of money laundering.
2. Key Legal Points in Financing Transactions
2.1 Loan and Debt Agreements
- Loans from Dubai-based banks or financial institutions are considered foreign loans in Turkey.
- Under TCO Art. 583 et seq., surety and collateral agreements must be in writing and contain an explicit declaration of intent.
- Collateral structures (mortgage, pledge, bank guarantees) must comply with both Dubai and Turkish law.
2.2 Interest and Profit-Sharing Arrangements
- In Turkey, interest rates are subject to certain limits (TCO and Central Bank regulations).
- In Dubai, interest rates may be more flexible; however, in Islamic finance contracts (murabaha, mudaraba), profit-sharing models replace interest.
- Turkish investors may consider participation banking models for financing sourced from Dubai.
2.3 Foreign Currency Transfers and Exchange Regulations
- Large transfers between Turkey and Dubai are subject to monitoring by MASAK (Turkey) and the Dubai Financial Services Authority (DFSA).
- According to Turkish exchange control rules, foreign loans obtained from abroad must be reported to the Turkish authorities.
3. Banking and Investment Services
3.1 Opening Bank Accounts
- Opening a bank account in Dubai usually requires company incorporation or an investor visa.
- In Turkey, Dubai residents can open accounts, but Know Your Customer (KYC) procedures are mandatory.
3.2 International Payment Systems
- SWIFT transfers are widely used between the two countries.
- Payments using cryptocurrencies are legally possible in certain Dubai free zones (e.g., DMCC), but in Turkey, cryptocurrencies cannot be used as a payment method.
3.3 Investment Funds and Securities
- Dubai-based funds cannot be publicly offered in Turkey without Capital Markets Board (CMB) approval.
- Turkish investment funds must obtain DIFC approval before marketing in Dubai.
4. Double Taxation and Tax Planning
- A Double Taxation Avoidance Agreement (DTAA) is in force between Turkey and the UAE.
- Withholding tax rates on interest, dividends, and profit distributions are determined according to the DTAA.
- Financing structures may use offshore companies or free zone advantages; however, Turkish tax legislation and transfer pricing rules must be considered.
5. Dispute Resolution
- Parties may choose arbitration or competent courts in financing agreements.
- In Dubai-based financing contracts, DIFC Courts or the DIFC Arbitration Centre are often preferred.
- For Turkish investors, adding ISTAC or ICC Arbitration clauses may be strategically beneficial.
6. Court of Cassation and Practice Notes
- Court of Cassation, 11th Civil Chamber, 2018/3126 E., 2019/4850 K. – Held that sureties in foreign loans would be invalid if not executed in compliance with Turkish law.
- Practice Note: Financing agreements signed in Dubai may require enforcement of foreign judgments procedures in Turkey to be executable.
Conclusion
Finance and banking transactions between Dubai and Turkey require the simultaneous application of two different legal systems.
Properly structured agreements, tax planning, and legally compliant collateral not only reduce costs for investors but also minimize potential dispute risks.
For this reason, such transactions should be conducted with the support of experienced legal professionals in international finance and banking.
Yanıt yok