Along with the Law numbered 7263 (“Law”) promulgated on the Official Gazette on February 3, 2021, several amendments have been made by the Ministry of Industry and Technology (“Ministry”) regarding the Law on Technology Development Zones and the Law on Supporting Research, Development and Design Activities.

As per the amendments, it is aimed to increase the R&D human resource capacity, to reveal and support the development of technology and innovative companies, to develop and institutionalize university-industry cooperation, and to strengthen the R&D and innovation ecosystem. Besides, it is also intended to make technology-intensive works that reach a certain point even more added-value by complementing and supporting each other by the structures established by the Law on Technology Development Zones and the Law on Supporting Research, Development and Design Activities.

Technology Development Zones

According to the Law, the managing company which would be established after the announcement of the Technology Development Zone ("Zone"), and entrepreneurs engaged in R&D and design activities in the Zone are required to obtain a business license and work license. It has been stipulated that these licenses will be issued and inspected by the provincial directorates of the Ministry. Furthermore, it has been regulated that the permission of the Ministry is required for the articles of association ("AoA") of the managing company, and any changes to be made in the AoA.

Significantly, it became possible for the managing company of the Zone to establish an incubator outside the areas of the Zone with the permission of the Ministry upon the decision of the Evaluation Board. However, it has been stated that only incubation entrepreneurs can participate in these incubation centers and the centers to be established in this context and the conditions to be sought in the entrepreneurs to be located here shall be determined by the Ministry. In this regard, entrepreneurs in those incubation centers can benefit from support, incentives, and exemptions. The upper limit of incentives to be provided to those operating in the Zone has been increased and the duration of this application has been extended to 31.12.2028.

As per the Law, if the activities in the Zone area cease for one year, except for force majeure events, the President's decision regarding the announcement of the area to the Technology Development Zone shall be abolished together with its provisions and results.

Lastly, an important regulation has been introduced regarding the termination of the contracts of the entrepreneurs operating in the Zone. In this respect in case the entrepreneurs do not submit a new project as of the completion date of the project and do not submit the information and documents they are obliged to provide to the managing company, their contract shall be deemed to be terminated.

R&D, Innovation and Design Activities

The extension of the duration for the incentives to 31/12/2028 has been stipulated also for the incentives within the scope of the Law on Supporting Research, Development and the upper limit for these incentives has been increased up to 1.000.000 TRL.

Additionally, along with the new provision brought by the Law, the competent authorities to carry out the expediency and conformity audits regarding R&D, innovation, and design activities are designated as the Ministry or the managing companies of the technology development zones authorized by the Ministry.

Nihan Ünal