About a month ago, Turkey’s cabinet signaled it was preparing to raise the minimum investment amount for the property acquisition route to Turkish citizenship from US$250,000 to US$400,000. This Friday, the pertinent amendments to the country’s citizenship law were published in the official gazette, along with an effective-by date: one month from the date of publication in the gazette, i.e. June 13th, 2022.
The gazetted regulations also contained one surprising element; a new category of qualifying investment that had not been heralded in last month’s announcements: Starting next month, prospective citizenship applicants will be able to qualify by investing “at least US$500,000 or its equivalent in foreign currency into the private pension system, provided that it is kept in the funds determined by the Insurance and Private Pensions Regulation and Supervision Agency and remains in the system for three years.”
According to the new regulations, investors would sell foreign currency to a commercial bank in Turkey, which would, in turn, sell that foreign currency to the Turkish Central Bank. Foreign investors would subsequently be in possession of a Lira-denominated private retirement account, which they must keep for at least three years.
It was not immediately clear whether the government would partially match contributions (as it does for salaried employees in Turkey at a rate of 25% of the employee’s own contributions). Nor did the regulations specify any disbursement schedule for such retirement accounts.
Commenting on the gazetted regulations, Taymour Polding, Managing Partner at CIP Turkey, indicated the increase in minimum investment requirements had been expected for some time already prior to last month’s initial government announcement, which has also served to galvanize investors.
“The announcement led to a last-minute wave of investors, many of whom have been sitting on the fence for some time.”
Even now that the effective-by date is confirmed as being less than a month away, Polding points out, “there is still a very small window of opportunity to beat the price-increase deadline. But quick and decisive action would be required.”
Questioned as to what an investor must do now to qualify before the raised minimum requirement takes effect, Polding says they would need to obtain the title deed to the property or a notarized promise of sale agreement with the seller, as well as apply for a Letter of Conformity, a certificate stating that the investor has met the qualification criteria.
In practice, he explains, that will typically mean the applicant has to transfer the full investment amount directly to the property seller as soon as possible. That is only advisable in a minority of cases, and applicants looking to rush an application in this manner are advised to proceed with caution.
Christian Henrik Nesheim is the founder and editor of Investment Migration Insider, the #1 magazine – online or offline – for residency and citizenship by investment. He is an internationally recognized expert, speaker, documentary producer, and writer on the subject of investment migration, whose work is cited in the Economist, Bloomberg, Fortune, Forbes, Newsweek, and Business Insider. Norwegian by birth, Christian has spent the last 16 years in the United States, China, Spain, and Portugal.