Inward Processing Incentive Consultancy

The Inward Processing Authorization (IPA) is a premier export incentive. By exempting you from customs duties, it directly boosts net profit; by eliminating VAT on domestic purchases, it provides significant financial liquidity; and by bypassing trade policy measures, it increases your competitive advantage through time and cost savings.

It is no exaggeration to say that an IPA equals rigorous tracking. We often observe foreign trade firms making critical errors due to lack of monitoring or inexperience.

At M’OCEAN, we provide expert guidance on obtaining the IPA, utilizing it correctly to maximize all available benefits, and ensuring a seamless closure process.

You should choose us because we work with a wide range of industry leaders, maintain strict command over evolving legislation, and possess deep-rooted knowledge of both inward processing and general customs regulations. Our strength lies in our elite team, led by a Former Chief Customs Inspector and supported by seasoned customs consultants.

M'OCEAN

What is the Inward Processing Regime?

The Inward Processing Regime is a customs system that allows companies established within the Turkish Customs Territory (excluding free zones) to import raw materials, auxiliary materials, semi-finished goods, packaging, and operating materials without being subject to trade policy measures. This applies to goods intended for the production of processed export products, where import duties are secured by a guarantee. Once the export commitment is fulfilled, the guarantee is refunded.

The system operates under two types:

  1. Suspension System: Duties are secured by a guarantee at the time of import.

  2. Drawback System: Duties are paid at import and refunded upon export.

What is an Inward Processing Authorization (IPA)?

An Inward Processing Authorization (IPA) is an export incentive certificate issued by the Ministry of Trade. To benefit from the regime, this certificate is mandatory. It is project-based; a project must be prepared and submitted electronically via the Ministry’s DYS (Support Management System). Once approved, the authorization can be utilized.

Advantages of Obtaining an IPA

  • Tax Deferral: Customs duties, additional customs duties, anti-dumping duties, VAT, and SCT are not paid at import but are instead linked to a guarantee.

  • VAT-Free Domestic Purchases: Under Provisional Article 17 of the VAT Law (suspension-cancellation), holders can purchase domestic goods without paying VAT for use in export production.

  • Equivalent Goods: The ability to use “equivalent goods” (pre-exported or domestic stock) in place of imported materials.

  • Exemption from Trade Policies: Faster transactions by bypassing certain trade policy measures, such as certificates of conformity or specific import permits.

  • Discounted Guarantees: The right to utilize discounted guarantee rates within the IPR system.

Critical Considerations & Risks

While the regime offers significant advantages, violations carry substantial penalties under Customs Legislation. Sanctions are particularly prevalent during the “closure” stage of the authorization. Understanding the specific penal acts and regulatory requirements is vital to avoiding these heavy financial burdens.

Why Should You Seek Consultancy?

An IPA equals rigorous tracking. We frequently observe firms making costly errors due to lack of monitoring or inexperience.

  • Time & Benefit: Experts save you time and maximize your incentives while minimizing risks.

  • Strategic Planning: Ensuring the project is designed correctly from the start to speed up approval.

  • Accurate Calculations: Proper calculation of consumption rates (wastage) and Compensatory Duty (TEV) to avoid over or underpayment.

  • Seamless Closure: Managing the project life cycle to ensure the authorization is closed without penalties.

Why Choose M’OCEAN?

Our strength lies in our extensive industry experience and our elite team, led by a Former Chief Customs Inspector and seasoned Customs Consultants. We don’t just know Inward Processing; we have a profound mastery of the entire Customs Regulatory framework.

How We Support You:

If you are applying for the first time:

  • Feasibility analysis (Pros and Cons for your specific firm).

  • Accurate initial application and project design.

  • Managing revisions and legislative compliance.

  • Precise TEV calculations and trouble-free closure.

If you already have an active Authorization:

  • Efficiency analysis (Are you using it to its full potential?).

  • Audit of current usage to identify and fix compliance gaps.

  • Ongoing legislative monitoring and strategic guidance.

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