Compliance Quarterly Türkiye

Global

Low carbon projects: Global hydrogen and carbon capture and storage market insights

Low-carbon hydrogen and Carbon Capture and Storage (CCS) projects are essential technologies driving the global journey toward decarbonization, offering versatile solutions for reducing emissions across hard-to-abate sectors. 

For more information, read our guide, "Low carbon projects."

Climate litigation: Global surge and landmark rulings

Global climate change litigation is rapidly accelerating, with the total number of cases reaching 3,099 by July 2025 and landmark rulings establishing new standards for state and corporate climate accountability. Notable trends include high-profile successes in international courts and the judicial development of new tests for climate liability.

Read the full publication, "Climate change litigation update."

Insuring the climate: The carbon credit market’s integrity

The carbon credit insurance market is emerging as a critical component for maintaining trust and integrity in global decarbonization efforts, offering protection against risks like non-delivery and invalid credits. This sector is vital for supporting low-carbon projects, especially as global schemes like CORSIA drive mandatory compliance and demand for reliable credits.

Read the full publication, "Carbon credit insurance market: Challenges and opportunities in a growing sector."

Türkiye

Climate Law is enacted

The Climate Law No. 7552 (Law) was enacted by the Grand National Assembly of Türkiye on July 2, 2025.

The purpose of the Law is to combat climate change in line with the vision of green growth and the goal of achieving net-zero emissions. The Law focuses on the reduction of greenhouse gas emissions and adaptation to climate change, and, in this context, regulates the procedures and principles regarding planning and implementation tools, revenue arrangements, permitting and inspection processes, as well as the related legal and institutional framework.

The Law introduces various regulations and imposes different obligations upon a range of institutions and organizations, such as:

• Establishing Türkiye Green Taxonomy by the Climate Change Presidency (Climate Presidency), with the aim of mobilizing climate finance;
• Preparing the Nationally Determined Contribution, which sets out strategic and action plans for the reduction of greenhouse gas emissions, establishing net-zero targets and governing activities for adaptation to climate change;
• Developing climate finance resources such as the Emissions Trading System to be established by the Climate Presidency and encouraging green/sustainable capital market instruments.

Considering developments within the European Union in line with the net-zero emissions target of the European Green Deal, the Law represents a significant step for Türkiye in establishing its own carbon pricing system. However, it is also highly criticized for not prioritizing the fight against climate change.

You may access our more detailed article on the content of the Law and the upcoming obligations in the article, "The Climate Law is Enacted."

The procedures and principles on sustainability reporting has been published

Preparation of a sustainability report, for companies that meet certain criteria within the scope of the Türkiye Sustainability Reporting Standards (TSRS), was made obligatory pursuant to the Board Decision of the Public Oversight, Accounting and Auditing Standards Authority (the Board) dated December 27, 2023 and numbered 21634, and the Board Decision dated December 16, 2024 and numbered 28294. Hence, the Procedures and Principles Regarding the Implementation Scope of TSRS (Procedures and Principles), entered in force to ensure the accurate and consistent implementation of the said reporting obligation, clarify the criteria for identifying the companies that will fall within the scope of mandatory TSRS reporting, provide transparency regarding the calculation methods and eliminate potential uncertainties in practice.

Along with the Procedures and Principles, detailed regulations have been introduced regarding the reporting thresholds and exemptions. Within this context, and as opposed to the previous decisions, following companies have become exempt from TSRS reporting obligation:

(i) joint stock companies that do not trade on the stock exchange or other organized markets but issue capital market instruments (other than shares) without a public offering (until the end of the fiscal period in which the issued instruments are redeemed), or that hold an approved issuance certificate with a valid term for such purpose; and (ii) companies whose shares are traded on Borsa Istanbul’s Watchlist Market or the Venture Capital Market for sale to qualified investors.

Furthermore, the criteria set out in the previous decisions have been clarified. It has also been clarified that the two criteria to be fulfilled in successive reporting periods do not necessarily have to be the same.

Regulation on the Management of Industrial Emissions has been published

The Regulation on the Management of Industrial Emissions (Regulation), prepared based on Directive No. 2010/75/EU on Industrial Emissions for the purpose of aligning with European Union legislation, was published in the Official Gazette on January 14, 2025.

The Regulation, which will come into force on December 1, 2025, covers businesses such as facilities with a rated thermal power of 50 MW or more for power generation, petroleum refining, coke coal production, gasification, liquefaction and pyrolysis, metal production and processing, mineral industry, chemical industry, waste management and facilities engaged in activities using organic solvents. Such facilities shall obtain a certificate showing that they are being operated in accordance with the green transformation process (SYD) in the industry (SYD Certificate). Accordingly, businesses subject to the Regulation are obliged to register with the electronic system and update their information on this system by April 1^st each year. According to the Regulation, the facilities within the scope of the Regulation are obliged to obtain a SYD Certificate for the completion of the environmental permit and license process.

With the SYD Certificate, businesses will be able to benefit from financial supports such as incentives, grants and loans according to the relevant legislation.

Facilities that are in operation or in the process of environmental impact assessment application at the time the Regulation enters into force are required to submit the necessary information and documents to the Ministry of Environment, Urbanization and Climate Change within 90 days after obtaining the environmental permit and/or license.

The targets of the Regulation within the scope of harmonization with the European Union regulations, are to encourage eco-friendly production, along with reducing emissions and waste generation.

You may access a detailed article on the content of the Law and the upcoming obligations in the article, "Regulation on the Management of Industrial Emissions has been Published."

Draft Regulation on the Emissions Trading System published

On 22 July 2025, the Climate Change Presidency published the Draft Regulation on the Turkish Emissions Trading System (Draft Regulation) for public consultation until August 4, 2025. The Draft sets out principles for ETS implementation, establishes the technical framework for the national carbon market and introduces instruments to ensure compliance with the EU Carbon Border Adjustment Mechanism (CBAM).

Under the Draft Regulation, all ETS installations must obtain an emissions permit, serving as official authorization of compliance, with operation without a permit subject to administrative fines. Installations must follow comprehensive MRV (Monitoring, Reporting, Verification) procedures, submitting annually a Monitoring Plan, Methodology Plan, Greenhouse Gas Emission Report and Activity Level Report, all verified by accredited bodies and submitted to the Climate Change Presidency.

Installations are required to surrender verified allowances equal to their annual emissions by the end of November each year. Flexibility mechanisms such as Banking (carrying forward unused allowances) and Borrowing (using future-year allowances in advance) are allowed, with penalties for non-compliance.

The ETS will start with a pilot phase in 2026 – 2027, during which operators will receive 100 percent free allocation based on benchmarking, and carbon credit offsetting will not be permitted. The first full compliance period runs from 2028 to 2035 in two stages (2028 – 2030 and 2031 – 2035). Operators must obtain an emissions permit within three years of the Law’s entry into force, with a one-time presumption of compliance during this period; this deadline may be extended up to two years by the carbon Market Board.

Communiqué on the Calculation of Green Asset Ratio by Banks is published

The “Communiqué on the Calculation of Green Asset Ratio by Banks” (Communiqué), prepared by the Banking Regulation and Supervision Agency (BRSA), was published in the Official Gazette on April 11, 2025 to set procedures for calculating and reporting banks’ green asset ratio and other key performance indicators for environmentally sustainable financing.

The Communiqué defines the green asset ratio as the primary key performance indicator for environmental sustainability, calculated by dividing eligible green assets—aligned with environmental objectives and meeting social and environmental standards—by total on-balance-sheet assets, adjusted for specific exclusions. Banks must calculate this ratio based on their non-consolidated balance sheets and verify asset eligibility through third-party reports, including emission reports, feasibility studies, energy efficiency audits, certificates and expenditure documents.

Reporting obligations begin on June 30, 2025, with frequency and methods set by the BRSA, which may also define new key performance indicators and reporting requirements in line with national taxonomy. Compared to the Draft Communiqué of September 27, 2023, the final version removes the “greenwashing” definition and elaborates technical screening and certification processes. Banks should prepare data collection, asset classification and reporting systems to ensure timely compliance.

You can read our detailed article regarding this Communiqué in the article, "Communiqué on the Calculation of Green Asset Ratio by Banks is Published."