Controlled Foreign Company Regime in Turkey and its Valuation

In 2006, a new Corporate Income Tax Law was introduced in Turkey. One of its aims is to fight against harmful tax competition and therefore it covers defensive measures such as controlled foreign company (CFC) and transfer pricing practices which are intended to prevent companies from leaving their foreign subsidiaries' incomeabroad. This article describes and analyses CFC practices initiated in Turkey. Rather than giving detailed information, the article gives the definition of CFC's and summarizes their general features in a comparative approach, taking other country applications into account, and gives a general framework of CFC legislation in Turkey.