Technology Transfer Agreements in Turkey: 6 Key Strategic Recommendations

Introduction

Technology transfer agreements are increasingly shaping the Turkish innovation ecosystem, creating pathways for foreign investors and Turkish startups to collaborate, scale, and commercialize cutting-edge ideas. These agreements, often involving the licensing of patents, software, technical know-how, or trade secrets, play a strategic role in enabling companies to share proprietary technology while maintaining competitive advantage.

Turkey presents a legally robust and investor-friendly environment for such transactions. However, successfully navigating the landscape requires a nuanced understanding of Turkish contract law, intellectual property (IP) legislation, and competition regulations. As a top-tier law firm with extensive experience in cross-border technology transfers, we outline the critical legal considerations that every foreign investor and Turkish tech entrepreneur should factor into their agreements.

Legal Framework Under Turkish Law

Equal Treatment and Contractual Freedom

Foreign and local companies enjoy equal rights under Turkish law when it comes to entering into licensing or technology transfer agreements. According to the Foreign Direct Investment Law, there is no discrimination based on nationality, meaning foreign investors are granted the same treatment as domestic entities (see Investment Office of the Presidency of Turkey). Parties are free to structure their agreements as long as they adhere to public order and general obligations law.

Protection of Intellectual Property

Technology transfers in Turkey are regulated by the Industrial Property Code (Law No. 6769) and the Law on Intellectual and Artistic Works. These laws comprehensively cover the protection of various IP categories including patents, trademarks, and designs. While copyright protection typically does not extend to abstract concepts or ideas, detailed elements of a technology (like documented source code or software architecture) may qualify for protection.

Confidential, defined, and commercially valuable information—often referred to as know-how—may also be licensed. As per the Turkish Competition Authority’s guidelines, know-how includes technical data that is substantial, identified, and not generally known.

For effective enforcement, it is recommended that core IP assets such as patents or trademarks be registered in Turkey. Exclusive licensees have the right to initiate infringement lawsuits unless this is contractually restricted, as reaffirmed by prevailing court practice and doctrinal interpretations.

Contractual Elements and Licensing Structures

Under Turkish law, licensing agreements are governed by the principle of freedom of contract. In the absence of a clause to the contrary, licenses are presumed to be non-exclusive. This means the licensor retains the right to use the IP and to grant additional licenses.

Parties should define:

The territorial scope (e.g., Turkey, regional, or global)
Field of use
Duration of the license
Sublicensing conditions

Payment structures are flexible and typically consist of royalties, lump-sum payments, milestone-based fees, or hybrid arrangements. Turkish legal doctrine supports a broad range of compensation methods as long as the terms are clear.

Ownership and Improvements

As per the general principles of Turkish IP law, the licensor retains ownership unless otherwise stated. The agreement should set out the status of derivative works or improvements. If the licensee is expected to enhance or build upon the licensed technology, the parties should decide whether such developments revert to the licensor via a grant-back mechanism.

Inventions made by employees must be properly assigned to the employer to ensure that the company can license the invention without legal uncertainty.

Confidentiality clauses are vital and should outline what constitutes confidential information, limitations on disclosure, and procedures post-termination. Restrictions on reverse engineering and unauthorized registration of improvements should also be incorporated.

Although not compulsory, recording the license at the Turkish Patent and Trademark Office is advisable. Registered licenses offer enforceability against third parties and additional legal safeguards, especially in the event of a transfer or IP-related dispute.

Compliance with Competition Law

Turkey’s Law No. 4054 on the Protection of Competition mirrors many aspects of EU competition law, including the treatment of IP-related agreements. According to the Communiqué No. 2008/2 on Technology Transfer Agreements issued by the Turkish Competition Authority, technology licensing agreements that meet specified market share thresholds may benefit from a block exemption.

If each party’s market share is below 30% (for competitors) or 40% (for non-competitors), the agreement is likely to be exempt from antitrust enforcement. However, certain restrictions are always prohibited. These include fixing resale prices, imposing absolute territorial protection between competitors, and preventing independent research and development.

Clauses preventing the licensee from challenging the licensor’s IP rights are also problematic. While the licensor may retain the right to terminate the agreement in such cases, unconditional no-challenge clauses risk breaching competition law.

Strategic Recommendations

Perform Thorough Due Diligence: Validate ownership of IP assets, ensure no conflicting rights exist, and confirm that the technology is properly protected in Turkey.
Draft Clear, Detailed Agreements: Define the licensed subject matter, scope of use, territorial limits, payment structure, and termination conditions in precise terms.
Protect Confidential Information: Include robust confidentiality clauses, return/destruction obligations upon termination, and restrictions on the misuse of technology.
Address Improvements and Derivatives: Clarify rights over any future developments stemming from the use of the licensed technology.
Ensure Competition Compliance: Avoid hardcore restrictions and seek legal counsel on whether the deal qualifies for exemption under Turkish competition rules.
Plan Exit and Enforcement Mechanisms: Define dispute resolution forums, enforceability options, and procedures for termination or renewal.

Conclusion

Turkey offers a dynamic legal and commercial environment for technology transfer agreements. Its legal infrastructure supports innovation while providing protections for both licensors and licensees. By carefully structuring agreements and addressing the core legal issues highlighted above, foreign investors and Turkish tech startups can form successful, long-term collaborations that are both legally sound and commercially rewarding.

At our firm, we specialize in crafting and negotiating technology transfer agreements that align with our clients’ strategic objectives while ensuring full compliance with Turkish law. We are ready to support you in navigating every aspect of your cross-border technology transactions.