ARTICLE
17 October 2025

The Communiqué Amending The Communiqué On Domestic Goods Has Been Published

AL
Aydin Law

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In today's competitive business environment, strategic advantages play a vital role in enabling companies to achieve sustainable growth and financial strength.
Turkey Corporate/Commercial Law
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I. INTRODUCTION

In today's competitive business environment, strategic advantages play a vital role in enabling companies to achieve sustainable growth and financial strength. In this context, the Domestic Goods Certificate issued for products manufactured in Türkiye stands out as more than a mere certificate—it serves as a valuable instrument offering significant opportunities for businesses.

The Domestic Goods Certificate provides companies with various advantages, provided that the local content ratio in the production process is at least 51%. These advantages include a price preference of up to 15% in public procurements, additional points in KOSGEB supports, access to interest-free loans, and tax incentives. Such benefits enable businesses to reduce costs, enhance competitiveness, and contribute to the national economy.

On 15 October 2025, the Ministry of Industry and Technology (the "Ministry") published the Communiqué Amending the Communiqué on Domestic Goods (SGM-2024/10) (the "Amending Communiqué"). The Amending Communiqué introduces amendments to the Communiqué on Domestic Goods (the "Communiqué"), which was published in the Official Gazette No. 32793 dated 25 January 2025 and sets out the procedures and principles regarding the determination and certification of whether a product, for which an enterprise applies for a Domestic Goods Certificate, qualifies as a domestic good.

In this article, we will discuss the significant amendments introduced by the Amending Communiqué—some of which will enter into force on 5 November 2025 and others on 1 January 2026—and their implications for businesses.

II. GENERAL PRINCIPLES

1. What Is the Local Content Ratio Report?

Article 1 of the Amending Communiqué adds the definition of the "Local Content Ratio Report" to paragraph 1 of Article 3 of the Communiqué, which sets out the relevant definitions. This definition clarifies that the Local Content Ratio Report is a report prepared, upon the manufacturer's request, for products and inputs whose local content ratio is less than 51%. The report in question will be prepared by the relevant chamber or exchange.

2. What Are the Conditions for Software Products to Be Recognized as Domestic Goods?

Article 2 of the Amending Communiqué revises paragraph 3 of Article 4 of the Communiqué, which governs the conditions under which software products are recognized as domestic goods. The requirement to possess a Technological Product Certificate issued by the Ministry has been preserved. In addition, it has been stipulated that for software products holding such a Technological Product Certificate, the Local Content Ratio shall be deemed 100% in the Domestic Goods Certificate issued for such products.

3. What Is the Scope of the Term "General Expenses Related to the Product"?

Article 3 of the Amending Communiqué introduces a revision to Article 8 of the Communiqué, which governs the calculation of the Local Content Ratio. The amendment clarifies which expenses are included under the term "general expenses related to the product" when calculating the costs of domestic and imported inputs.

The general expense items related to the product are listed as follows:

  • Maintenance and repair expenses for machinery and equipment
  • Rental expenses
  • Depreciation expenses
  • Energy, transportation, and water expenses
  • Research and development and design expenses recorded as direct costs
  • Research and development and design expenses amortized through depreciation, and similar expenses

4. Which Inputs Are Included as 100% Domestic in the Local Content Ratio Calculation?

Another important amendment introduced by Article 3 of the Amending Communiqué to Article 8 of the Communiqué concerns the classification of inputs that are to be included as 100% domestic in the Local Content Ratio calculation:

  • Electricity, water, and natural gas inputs
  • Expenses related to patents, utility models, industrial designs, and trademarks directly used in the production of the product, provided that the initial registration of the relevant intellectual and industrial property rights has been made with the Turkish Patent and Trademark Office on behalf of a company established in Türkiye
  • Products obtained as inputs from recycling activities carried out by an enterprise holding a license under the Environmental Permit and License Regulation, published in the Official Gazette No. 29115 dated 10 September 2014

5. What Are the Other Amendments Introduced by the Communiqué?

Article 3 of the Amending Communiqué adds a ninth paragraph to Article 8 of the Communiqué, stipulating that inputs whose invoice amount exceeds 0.5% of the product cost and for which the Local Content Ratio has not been calculated shall be included in the Local Content Ratio calculation as domestic inputs at a rate determined by the Ministry, provided that such inputs are produced by an enterprise holding an industrial registration certificate in which the relevant input is listed under the production code.

The same article also adds a tenth paragraph to the Communiqué, providing that the Ministry will publish a list of inputs that are not produced or are produced in limited quantities in Türkiye and are sourced from abroad. These inputs will be included in the Local Content Ratio calculation as imported inputs using coefficients between 0 and 1, as announced by the Ministry.

III. CONCLUSION

The published Amending Communiqué has rendered the implementation of the Domestic Goods Certificate clearer and more systematic. The regulations introduced regarding the calculation of the local content ratio, the scope of general expenses, and the classification of certain inputs as domestic contribute to reducing practical uncertainties and facilitate the certification process for businesses.

The Domestic Goods Certificate is not merely an administrative requirement for companies; it also serves as a tool to enhance competitiveness. By providing price advantages in public procurements and priority in various incentive programs, the certificate strengthens the financial position of businesses, while its support for domestic production and alignment with sustainability objectives confer strategic value.

Click here to access the Amendment Communiqué.
Click here to access the Local Content Communiqué.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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