Cumhuriyet – NERO Industries Receives Extensive Support for Project Initiated in 2016

The Turkish government has granted extensive support to NERO Industries’ TRY 1.6 billion manufacturing facility investment in the Sincan district of Ankara. By Presidential Decision, the facility has been granted a wide range of incentives, including tax exemptions and reductions, energy support, personnel incentives, and investment land allocation. These incentives will also apply retroactively to expenditures made since the project’s commencement in 2016. If the company is unable to complete the project by 2022, an additional three-year extension may be granted.

According to the Presidential Decision, a manufacturing facility will be established in Ankara Sincan for the production of sensors, laser/radar threat detection and warning systems against guided missile and rocket threats, Chemical, Biological, Radiological and Nuclear (CBRN) filtration systems, and explosion suppression systems. The facility will be constructed by NERO Industries Defense Industry Inc., and the investment will benefit from project-based state aid. The project officially commenced on November 4, 2016, with completion planned within six years. Should the investment not be finalized within this period, the Ministry of Industry and Technology may grant an additional three-year extension.

The total investment amount is TRY 1.6 billion, with 620 additional jobs expected to be created. Upon completion of the investment period, the planned annual production capacities are as follows:

• Sensors: 102,030,000 units

• Laser/Radar Threat Detection and Warning Systems: 5,500 units

• CBRN Filtration Systems: 3,000 units

• Explosion Suppression Systems: 32,000 units

The incentives from which the company will benefit include:

• Customs duty exemption

• VAT exemption

• VAT refund

• Tax reduction (Tax reduction rate: 100%; investment contribution rate: 80%; utilization rate of the investment contribution during the investment period: 100%)

• Employer’s share of social security premium support (starting from the investment period, for 10 years, with no upper limit)

• Income tax withholding support (10 years)

• Qualified personnel support (up to TRY 50 million)

• Interest and/or profit share support (up to TRY 250,000, for a maximum of 10 years from the loan utilization date)

• Energy support (up to TRY 38 million, covering 50% of energy consumption costs for up to 10 years from the start of operations)

• Investment land allocation

Expenditures incurred by the investor since the project’s initiation in 2016 will be transferred to the investment incentive certificate to be issued following the new decision and will benefit from the applicable incentives. The qualified personnel support will be applied for five years, up to twenty times the monthly gross minimum wage per qualified employee, with the projected number of qualified personnel being 30.

The interest or profit share support will be implemented by the Ministry covering 80% of the interest or profit share paid on investment loans obtained from one or more financial institutions, for loans amounting to up to 80% of the fixed investment value. Should the final investment amount fall below TRY 1.6 billion, any excess incentives received by the company will be recovered.

News Source