The Capital Movements Circular was amended to clarify the regules regarding FX loan borrowings by ordinary partnerships in which all the partners are legal persons (“Ordinary Partnerships“).
What Does the Amendment Say?
Ordinary Partnerships will be considered Turkish residents and FX loans extended to Ordinary Partnerships will be considered loans utilized by the partners pro rata to their liabilities in the partnership.
If the FX loan to be utilized based on FX income, the total FX income of all the partners will be calculated in accordance with the partners’ shares.
The total FX loan balance of all partners will be calculated in accordance with their shares and if the balance is higher than USD 15 million, the Ordinary Partnership can utilize FX loans.
Ordinary Partnerships will be required to provide a copy of their notarized partnership agreements to Turkish banks extending loans/acting as intermediary, as the case may be.