STORES LOCATED IN SHOPPING CENTERS UNDER CONSTRUCTION; IMPORTANCE OF OCCUPANCY PERMIT FOR OBTAINING A BUSINESS LICENSE
Pursuant to Article 6 of the Regulation on Business Opening and Operation Licenses, no workplace shall be opened or operated without obtaining a business opening and operation license (the “Business license”, in Turkish, “işyeri açma ve çalışma ruhsatı”) issued by the municipality (or by the Directorate of the relevant Organized Industrial Zone in Organized Industrial Zones/ “OIZ”).
Since the specific documents required for the Business license application may vary between authorities, it is strongly recommended to consult the relevant authority before initiating any Business license application. However, one requirement remains constant: one of the key requirements for obtaining a business license is that the immovable property must have a valid occupancy permit (in Turkish, “iskan ruhsatı” or “yapı kullanma izin belgesi”).
The occupancy permit is an official document being issued by municipalities/ OIZ’ directorates upon application, certifying that the building is legally usable and has been constructed in accordance with its building permit rules and the municipal regulations. This permit is not only mandatory for workplaces, but also a legal requirement for all buildings, regardless of their intended purpose.
If a leased or purchased property is not suitable for obtaining an occupancy permit, due to non-compliance or other legal deficiencies, the business license application will probably be rejected by the competent municipality/ OIZ’ directorate. Therefore, it is strongly recommended to verify whether the property has a valid occupancy permit before signing any lease agreement or sale and purchase agreement.
On the other hand, some sellers or lessors may verbally assure that the occupancy permit will be obtained within a certain period; however, such commitments may not be fulfilled. To mitigate this risk, it is advisable to include provisions in the relevant lease contract/ sale and purchase contract, imposing obligations or sanctions on the counterparty in the lease or sale and purchase agreement, such as a declaration that the property is suitable for the tenant’s/purchaser’s intended commercial use, a clause stating that rent payments will be suspended if the Business license cannot be obtained, a right for the tenant to terminate the agreement if licensing is not possible without a valid force majeure, compensation and penalty clauses for any damage caused by the landlord’s/ seller’s failure to deliver a legally usable property with occupancy permit.
Moreover, before signing the lease or sale and purchase agreement, the licensing and zoning status, the property’s designation under the zoning plan (e.g., residential, commercial) should be checked with the relevant municipality, and if necessary, a notarized written undertaking should be obtained from the lessor/ seller. Otherwise, the business may never open, the licensing process may be blocked, rent payments may continue, and lengthy legal disputes may become inevitable.
Our Law Firm remains at your disposal for any further clarifications you may need.
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