Highlights of the Laws on the Acquisition of Immovable Property (21 May 2024)

• The Turkish Republic of Northern Cyprus has recently introduced important amendments to its laws regarding the acquisition and long-term leasing of immovable property by foreigners. These changes, published in the Official Gazette on May 21, 2024, are intended to enhance transparency, ensure regulatory compliance, and attract legitimate foreign investments. Here’s a comprehensive summary of the key amendments.

Certain Restrictions on the Acquisition of Immovable Property by Foreigners

• • Restricted Areas: Foreign nationals cannot purchase property in agricultural and forest areas.
• • Government Authority: The Council of Ministers can prohibit foreigners from acquiring property in specific areas for reasons of national security, public welfare, or public order, allowing only long-term leases in these zones. Transactions violating these rules will be invalidated.
• • Ownership Limits: Foreign nationals are limited to owning a maximum of 7% of a district's total area and 3% of each locality within that district. Exceeding these limits will result in invalidation by the District Land Registry Office.

Rules Regarding the Acquisition of Immovable Property by Foreigners




Acquisition Limits:

• • Land: Foreigners can acquire one property with land up to 1,338 square meters, with permission from the Council of Ministers, and only one residential unit can be built.
• • Apartment: One apartment can be purchased, but nationals from countries recognizing Northern Cyprus may buy up to three units.
• • Detached House: The land size limit is 3,300 square meters, with no additional residential units allowed.

Application Requirements, Payments, and Limitations:

• • Foreigners must apply to the Ministry, ensuring the property has a title deed or easement title under relevant laws.
• • Applications must be submitted online, including necessary documents like title deeds and proof of purchase price.
• • A service fee of half the gross minimum wage is required. It is divided between the Immovable Property Commission and the Land Registry and Cadastre Department.
• • A criminal record check and security investigation are mandatory. Positive results allow the transaction to proceed; negative results lead to rejection. Transfers must be completed within six months of approval.
• • If a mortgage is not established, the six-month period starts from payment confirmation. All legal payments, taxes, and fees must be paid within 60 working days from the Council of Ministers' permission publication, or the permission is automatically canceled.
• • If an application is canceled, reapplication is allowed with fees, but a third application for the same property by the same foreigner is prohibited.
• • Foreigners cannot purchase property with a shareholding title deed for land but can buy up to three shares of an apartment or detached house under specific conditions.
• • Foreigners related by first-degree or of the same nationality cannot purchase more than half of the apartments within a parcel. Additionally, 20% of housing projects in development areas must be sold to Turkish Cypriots.
• • For investments in tourism, education, health, industry, agriculture, technology, or R&D, the Council of Ministers may grant permissions beyond general rules, provided the investment meets criteria like a minimum of 20 million Euros and must be used within two years, excluding land purchase. The investment will be supervised by relevant authorities.

Offenses and Penalties

• • Selling Property in Prohibited Areas: Selling property in agricultural or forest areas to foreigners is an offense, punishable by a fine of up to 500 times the monthly gross minimum wage.
• • Exceeding Acquisition Rights: Transactions that exceed the allowed acquisition rights for foreigners are offenses, with fines up to 500 times the monthly gross minimum wage.
• • Violation of Title Requirements: Entering into a sale agreement without a proper title deed or easement title is an offense, leading to a fine of up to 500 times the monthly gross minimum wage.
• • Selling Property with Shareholding Title Deed: Selling property with a shareholding title deed to foreigners is an offense, with fines up to 500 times the monthly gross minimum wage.
• • Selling Multiple Properties in the Same Parcel: Selling multiple properties within the same parcel to foreigners of the same nationality is an offense, carrying a fine of up to 500 times the monthly gross minimum wage.
• • Exceeding Area Limits: Buying or selling property that exceeds the specified area limits is an offense, with fines up to 500 times the monthly gross minimum wage. Also, failing to notify authorities within six months after a title deed transfer results in a similar fine.
• • Unauthorized Trustee Agreements: Entering into trustee agreements to acquire more property than allowed is an offense, with fines up to 500 times the monthly gross minimum wage.
• • Failure to Register Sale Agreements: Not registering sale agreements with the Land Registry Office within six months is an offense, leading to a fine of up to 500 times the monthly gross minimum wage.
• • Incomplete Transfer of Title: Failing to complete the transfer of title within six months, except due to administrative delays, is an offense, punishable by a fine of up to 500 times the monthly gross minimum wage.
• • Non-compliance with Sale Agreements: Not complying with or transferring sale agreements that exceed acquisition rights before the law's effective date is an offense, with fines up to 500 times the monthly gross minimum wage.
• • Failure to Register Trustee Agreements: Not registering trustee agreements within seventy-five days from the law’s effective date results in a fine of up to 500 times the monthly gross minimum wage

Status of Existing Sale Agreements

• • Determination Based on New Rules: Existing sale agreements and acquisitions exceeding the allowed limits will be evaluated according to the Amendment Law effective from its implementation date
• • Registration and Application Requirements: For the foreign nationals with pre-existing sale agreements must register these at the District Land Registry Office and apply for purchase permission within six months. For agreements exceeding acquisition limits one must notify the Ministry within the period and pay 1% of the sales price. This will involve paying half the transfer fees. Note that late notifications incur a 3% fee and follow different compliance rules.
• • Title Deed Registration: Foreign nationals with permission from the Council of Ministers must register the title deed within six months
• • Payment of Legal Fees: After finalizing a sale, all legal fees, taxes, and payments must be completed within 60 working days. Failure to pay results in automatic cancellation of permission.
• • Completion of Transactions: Transactions exceeding acquisition rights must be completed within six months, as specified
• • Transfer Fees: During the transfer process, the seller is responsible for paying half of the transfer fees.
• • Trustee (Mutawalli) Agreements: Trustee agreements must be registered within 75 days of the effective date. Unregistered agreements or those non-compliant with the law will be invalid.
• • Consequences of Non-Compliance: Non-compliance results in automatic cancellation of permission, and any previously registered agreements will be invalidated
• • Extension for Administrative Delays: The Council of Ministers may extend the transaction period by up to six months if delays are due to administrative issues. If legal proceedings are involved, the transfer process must be completed within one year of the final court decision.