Law No. 7464 on the Renting of Residential Properties for Tourism Purposes and Amendment of Certain Laws, which was enacted by the Turkish Grand National Assembly on 25 October 2023 (“Law“), regulates the requirements and obligations of lessees, lessors and intermediaries for the rental of residences for tourism purposes to real and legal persons for up to 100 days at one time (i.e., daily rentals) and the sanctions to be imposed in the case of violation. The Law is expected to be published in the Official Gazette shortly.
The Law is available here (in Turkish).
What does the Law introduce?
The main regulations introduced by the Law are as follows:
A. Permit obligation
To certify and register residences rented for tourism purposes for a maximum period of 100 days, it is now obligatory to obtain a permit from the Ministry of Culture and Tourism (“Ministry“) prior to entering into a rental agreement. The obligation to obtain a permit is regulated for lessors who own property or limited real rights.
Unanimous decision of all flat owners in the building. To maintain peace and order in the building and to prevent possible conflicts between the flat owners, the unanimous decision of all flat owners must be submitted in the applications for the permit certificate for the buildings where the independent section subject to the rental agreement for tourism purposes is located. In a residential complex consisting of buildings with more than one independent section, this requirement is only sought for the building where the daily rental residence is located.
Restrictions. In buildings where the number of independent sections registered in the name of the same person is more than 3, certain limitations have been introduced for issuing permits to prevent converting these buildings into a hotel function without meeting the legal requirements. In these buildings, a permit can be issued in the name of the same lessor for, at most, ¼ of these independent sections, and if the number of independent sections calculated according to this ratio exceeds 5, the application will also require a workplace opening and operation license and a unanimous decision of all floor owners if the building is located in a residential complex consisting of buildings with more than one independent section.
Exceptions. For residences containing more than one independent section, where there is a provision in the management plan issued in accordance with the Law of Property Ownership that short-term rental activities are allowed and where there are services such as reception, security and a daily cleaning service, a permission certificate can be issued without the following conditions: (i) a unanimous decision of all floor owners of the building, and (ii) granting a permission certificate on behalf of the same lessor for, at most, ¼ of the independent sections.
The rental agreements of high-quality residences may also be carried out by a housing company, in which case the permit shall be issued in the name of the housing company.
- Lessors who engage in daily rental activities without a permit shall be imposed an administrative fine of TRY 100,000 per residence and shall be given a 15-day period to obtain a permit. If the renting is continued without obtaining a permit at the end of the given period, an administrative fine of TRY 500,000 shall be imposed and a period of 15 days shall be given again. If the permit is not obtained within this period, an administrative fine of TRY 1,000,000 shall be imposed.
- If the permit certificate holders (i) do not submit the information and documents requested by the Ministry within 30 days, (ii) submit incomplete information, or (iii) submit misleading information or documents, an administrative fine of TRY 50,000 shall be imposed.
- If it is determined during the inspection that the residence does not meet the qualifications for the issuance of a permit, an administrative fine of TRY 100,000 shall be imposed and a period of 15 days shall be given to remedy the violations. If the violations are not remedied within this period, the permit shall be annulled.
- An administrative fine of TRY 1,000,000 shall be imposed on those who rent out the same residence more than 4 times within 1 year from the date of the first contract, although each time they make a rental contract for more than 100 days.
- If authorized public institutions and organizations report that the residence rented for tourism purposes is used in violation of public order, public security and public morality, the permit shall be annulled.
B. Obligation to hang a plaque
The plaque to be issued by the Ministry must be hung at the entrance of the flat to make it known that the residence rented for tourism purposes has a permit from the Ministry.
Sanction. If the permit certificate holders do not hang the plaque at the entrance of the flat, an administrative fine of TRY 100,000 shall be imposed and an extension of 15 days shall be granted. If the plaque is not hung within this period, an administrative fine of TRY 500,000 shall be imposed.
C. Prohibition of sub-rents
To ensure effective control and supervision over the daily rentals, sub-rent agreements are prohibited. Accordingly, it is prohibited for (a) the user to rent the residence leased from the permit holder to a third party on their own behalf, or (b) for the lessee to rent a residence leased for general accommodation purposes on their own behalf to a third party for tourism purposes on their own behalf. However, this prohibition excludes the use of the daily rental residence for legal entities’ employees.
Sanction. In the case of violation of the sub-rent prohibition, an administrative fine of TRY 100,000 shall be imposed per agreement.
D. Identity reporting obligation
The provisions of the Identity Reporting Law shall apply to the residences for which the permit certificate is issued. In this regard, entry, exit and accommodation status of persons shall be recorded, and the lessors are obliged to record the necessary identity information of the lessees and report the required information to the law enforcement authorities, similarly to hotels and pensions, to ensure public order.
E. Intermediary and advertising activities
The residence can only be leased for tourism purposes by the lessor itself or exclusively via a third party who is a Group-A travel agency operating certificate (i.e. TÜRSAB license) holder. Group A travel agencies refer to agencies that are duly authorized by the Ministry in accordance with the Law on Travel Agencies and the Association of Travel Agencies to perform all travel agency services.
- An administrative fine of TRY 100,000 per agreement shall be imposed on those who mediate the renting of residences for tourism purposes without a permit.
- An administrative fine of TRY 100,000 per residence shall be imposed on intermediary service providers who enable electronic trade and promotion of the activities in violation of the Law. A content removal or access block decision can be taken on the publication or the section where the violation occurred. In the case of noncompliance with this decision, an administrative fine of TRY 100,000 shall be imposed on the intermediary service providers for each residence.
F. Residences already rented for tourism purposes
The lessors who already engage in daily rental activities as of the date the Law enters into force (i.e. January 1, 2024) must obtain a permit certificate from the Ministry within 1 month from the effective date. The Ministry will evaluate the application within 3 months and the lessors whose applications are rejected cannot engage in daily rental activities. However, the rights of the lessees of these such daily rentals will continue until the end of the contract period.
In recent years, as a result of the search for alternative accommodation in the tourism sector in the world and in Türkiye, daily rentals have become very popular, which led to the need to regulate and control this sector. In this context, in parallel with the goal of developing the tourism sector under the Ministry’s control and supervision from a single source with an inclusive strategy, the Law aims to certify these residences and record the income generated by their rental. This prevents unregistered earnings and creates a reliable investment environment for all stakeholders serving in the tourism sector by providing an equal competitive environment. It is crucial for the stakeholders to follow the relevant regulations, obtain the necessary permits and comply with the obligations following the publication of the Law in the Official Gazette. In the upcoming days, the Ministry is expected to issue a secondary legislation to detail the obligations and procedures set out in the Law.