Foreign Direct Investment & Market Entry
Cross-Border Investment Structuring & Market Entry Advisory
Cross-border investment now takes place under a layered regime in which national security screening, sectoral consents and treaty-level investor protections must be navigated in parallel. Twenty years ago the principal legal task of a market entry transaction was corporate; today it is regulatory.
Mermeroglu Legal advises foreign investors entering Türkiye and Turkish investors deploying capital abroad, coordinating with applicable foreign law through experienced partners. Rather than treating market entry as a purely transactional exercise, the firm integrates legal, regulatory, tax and treaty considerations into a coherent investment framework — enabling investors to structure cross-border positions that are commercially viable, regulatorily compliant and protected under applicable investment treaties from the outset.
The firm advises on investments into Türkiye, Central Asia, Europe, the Middle East and Africa — drawing on its multi-jurisdictional legal network to provide consistent, coordinated advice across the relevant jurisdictions involved in each investment structure.
Legal Framework
The Underlying Legal Logic
The Domestic Entry Layer
Each host state operates an entry regime comprising company law formalities, sectoral consents, foreign ownership thresholds and — increasingly — national security screening. Where in 2010 fewer than fifteen jurisdictions operated FDI screening, by 2026 the figure exceeds forty, with mandatory pan-EU screening of strategic sectors now consolidated under the revised EU Foreign Investment Screening Regulation. The entry layer has become substantive, and frequently outcome-determinative.
The International Protection Layer
Bilateral investment treaties, multilateral instruments and customary international law together provide the foreign investor with substantive guarantees of fair and equitable treatment, protection from expropriation and access to international arbitration. Investment treaty protection is a function of the nationality of the investor and the route by which the investment is made — choices made at the entry stage determine which protections will be available in the event of a later dispute.
An effective FDI practice requires simultaneous fluency in three bodies of law: the entry regime of the host state; the treaty network protecting the investor's nationality; and the regulatory architecture of any third jurisdiction whose extraterritorial controls — notably US export and sanctions law, EU dual-use regulation — may also apply to the transaction.
Service Areas
Pre-Investment Legal & Regulatory Assessment
Legal feasibility studies, regulatory mapping and risk assessment prior to committing capital to a new jurisdiction — covering ownership restrictions, sector licensing, foreign exchange controls and applicable legal constraints.
Investment Vehicle & Structure Design
Selection and structuring of the optimal investment vehicle — subsidiary, branch, JV, SPV or holding structure — aligned with tax efficiency, regulatory requirements, financing needs and long-term operational objectives.
Greenfield Investments
End-to-end legal support for new market entry through organic business establishment, covering company formation, sector licensing, land acquisition, regulatory compliance and operational commencement.
Brownfield & Acquisition-Based Entry
Legal advisory for market entry through acquisition of existing businesses or assets — covering due diligence, SPA structuring, representations and warranties, regulatory approvals and post-closing integration.
Joint Ventures & Strategic Alliances
Structuring and negotiating joint venture agreements, consortium arrangements and strategic partnerships with local and international counterparts — addressing governance, risk allocation, exit mechanisms and dispute resolution.
Investment Incentives & Government Approvals
Identification and securing of available investment incentives, tax exemptions, grants and government approvals — including the six-tier regional incentive framework and Strategic Investment Incentives in Türkiye and equivalent programmes in other jurisdictions.
FDI Screening & National Security Review
Navigation of mandatory FDI notification and screening regimes, including the EU Foreign Investment Screening Regulation, CFIUS (US), the UK NSI Act and equivalent national mechanisms — advising on notification obligations, timing, mitigation measures and approval strategies.
Investment Treaty Protection (BIT, MIT)
Advisory on available bilateral and multilateral investment treaty protections — structuring investments to maximise treaty coverage, fair and equitable treatment, expropriation protection and access to ICSID or UNCITRAL investor-state arbitration.
Exit Strategies & Repatriation
Legal structuring of investment exit mechanisms — covering share sales, asset disposals, dividend repatriation, liquidation and winding-up procedures across jurisdictions, including tax-efficient repatriation planning and regulatory compliance.
Sector Intersections
Sectors in Which This Practice is Engaged
Foreign direct investment and market entry advice cuts across every sector of activity. The intensity of regulatory scrutiny varies with the sector of the target and the identity of the investor. The principal sector intersections are as follows:
- Energy, Renewables and Oil & Gas — investments in energy infrastructure are subject to elevated screening in nearly every developed jurisdiction.
- Defense & Aerospace — investments in defense industrial assets are subject to mandatory screening in almost all FDI regimes worldwide.
- Technology, Media & Telecommunications — semiconductor, AI, telecommunications, data and quantum technology investments are now categorically sensitive.
- Financial Institutions — banking, insurance and payment institutions are subject to prudential change-of-control approvals in parallel with general FDI review.
- Mining & Metals — critical and rare earth minerals investments increasingly trigger screening obligations.
- Transport & Logistics — port concessions, airport operations and strategic logistics infrastructure are routinely screened.
- Manufacturing — sensitive manufacturing (semiconductors, pharmaceuticals, dual-use industrial equipment) attracts heightened review.
- Real Estate & Hospitality — real estate investments in proximity to military or critical infrastructure may engage location-based screening.
Jurisdictional Reach
Comparative Jurisdictional Overview
Foreign investment regimes vary markedly between jurisdictions in scope, procedure and substantive outcome. Mermeroglu Legal advises on transactions engaging the legal and regulatory frameworks of the following principal investment jurisdictions, among others:
Foreign direct investment into Türkiye is regulated under the Foreign Direct Investment Law (Law No. 4875), which establishes equal treatment between foreign and domestic investors. Türkiye does not operate a general national security FDI screening regime; sector-specific consents apply in banking, insurance, energy, broadcasting, mining and defense, while foreign acquisition of real estate is regulated under the Land Registry Law (Law No. 2644).
For detailed advice on jurisdictions not listed above — including emerging FDI regimes, country-specific screening procedures or jurisdiction-specific timing and filing requirements — please direct your enquiry through the firm's contact channels.
Standards & Instruments
International and Regional Instruments
Cross-border investment is shaped by a layered framework of multilateral, regional and bilateral instruments. The most operationally significant for cross-border practice include:
ICSID Convention (1965)
The principal multilateral framework for investor-state arbitration, in force in over 150 Contracting States including Türkiye (since 1989). ICSID awards benefit from automatic recognition in all Contracting States without resort to the New York Convention.
Türkiye's BIT Network
Türkiye has concluded over eighty bilateral investment treaties (around seventy in force), covering all major OECD economies, the MENA region, the Caspian and Central Asia, the PRC and much of Sub-Saharan Africa — typically providing fair and equitable treatment, expropriation protection and ICSID arbitration.
Energy Charter Treaty (1994)
Provides multilateral investment protection in the energy sector and underpinned a substantial body of investor-state arbitration. The modernised text was concluded in 2024, though the EU and several Member States have announced withdrawal and the instrument's future remains under political pressure.
OECD Code of Liberalisation
The OECD Code of Liberalisation of Capital Movements (1961) establishes obligations of progressive liberalisation for OECD members, with substantial soft-law effect and a peer-review framework for investment screening regimes.
WTO TRIMs & MIGA Convention
The TRIMs Agreement (1995) constrains trade-related investment measures such as local content and export performance requirements, while the MIGA Convention (1985) provides World Bank Group political risk insurance significant in frontier and emerging-market financing structures.
EU Foreign Investment Screening Regulation
Regulation 2019/452 and its 2026 revision have substantial extraterritorial impact on transactions involving EU targets and on the structuring of EU-bound investment vehicles, with the revision harmonising and strengthening the regime across all Member States.
Recent Developments
Recent Decisions & Legislative Reform
Investor-state arbitration, national court review of screening decisions and a sustained pattern of legislative change have reshaped the investment landscape over the past three years. Illustrative developments include:
- Komstroy v. Moldova (CJEU, 2021) — held that the Energy Charter Treaty's dispute settlement provisions do not apply to intra-EU disputes; extended through Achmea and the 2024 PL Holdings line of cases.
- Hulley Enterprises v. Russia — the ~USD 50 billion Yukos award remains the subject of enforcement litigation across France, the UK, the US, the Netherlands, Belgium and Germany, with continued creditor success in Europe through 2024–2025.
- ConocoPhillips v. Venezuela (ICSID, 2024) — an Annulment Committee partially annulled a ~USD 8.7 billion award, addressing valuation methodology for expropriated upstream assets.
- UK NSI Act call-ins (2024–2025) — high-profile orders in semiconductor, civil nuclear and AI sectors, with the Newport Wafer Fab / Nexperia unwinding the most significant to date.
- EU — New FIR Regulation (2025–2026) — political agreement (Dec 2025) and compromise text (Feb 2026) mandate screening in all Member States and harmonise the minimum sector scope, with a 15-month transition.
- US — CFIUS Executive Order & 2025 regulations — the Outbound Investment Order on PRC semiconductor, AI and quantum investments, plus expanded real estate and TID-business scope; enforcement intensified (T-Mobile penalty, TikTok divestiture).
- Germany — Investment Screening Act (in preparation) — consolidation of the AWG/AWV framework into a single modernised statute through 2026.
- Türkiye & Saudi Arabia — Türkiye's citizenship-by-investment threshold raised to USD 400,000 and Decree No. 32 currency reforms; Saudi Arabia's Regional Headquarters Programme operational from January 2024.
Our Approach
How Mermeroglu Legal Engages
Foreign direct investment mandates frequently engage at least three legal systems concurrently: the law of the host state, the law of the investor's holding jurisdiction, and the law of any third jurisdiction whose extraterritorial controls apply to the transaction. Our practice is structured to coordinate across those legal systems through a single point of accountability.
Each mandate is led by a single matter principal at the firm, supported by an internal team drawing on corporate, regulatory, tax structuring, competition and arbitration practices. Where the matter requires advice on the law of jurisdictions outside Türkiye, we work through long-standing alliance arrangements with foreign counsel, including in the principal screening jurisdictions of Europe, the United States, the United Kingdom, the Gulf, the Caspian region and Asia.
We approach foreign investment work with particular attention to the front-end design of the investment vehicle and the transaction structure. Many regulatory issues that present in execution — screening triggers, sectoral consents, sanctions exposure, tax inefficiencies — are structurally determined at the front-end by the choice of holding jurisdiction, the identity of the immediate investor, the percentage acquired and the timing of the acquisition.
Our approach treats the entry layer and the protection layer as a single integrated framework. We assess both at the structuring stage to ensure that the investment is positioned both for regulatory clearance and for treaty protection in the event of a subsequent dispute.
INITIAL ENQUIRIES
Multi-jurisdictional investments and complex screening matters are handled through coordinated internal and alliance teams.
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