TECHNOLOGY DEVELOPMENT AREAS LAW (2/2005)
Aim of the Law
The aim of this law is to prepare a cooperation environment between higher education institutions and entrepreneurs, produce technological information, produce innovation in products on production methods, increase product quality and standards, increase productivity, reduced production costs, incentivize technology use, help technology transfer, accelerate the entrance of foreign capital to the country, commercialize technological knowledge, give opportunity to researchers and entrepreneurs in this field and add competition capacity to TRNC economy on international level.
Additionally establishment, operation, management, and audit principles of these Technology Regions and tax incentives, duty, authorization and liabilities of related person and institutions are arranged.
Technology Regions and Company responsible for Management
With 07.09.2005 dated and No S-1011-2005 Cabinet Decision, “Famagusta Technology Development Area” is declared as feasibility Project.
Company responsible for Management of Technology Development Area is registered as per Article 20 of Companies Act pursuant to 21.12.2005 dated and No S-1780-2005 Cabinet Decision.
Application and Assessment of Producing Companies
Company responsible for Management is responsible for employment of R&D staff to be in charge in the areas with assigning accommodation to suitable ones and evaluation of institutions, organizations, and entrepreneur demands that want to participate in the mentioned area.
The following incentive matters are also applied to Incentives within the scope of current Incentive Law on investments aimed to be made by Producing Companies which will be active in establishment of the Area within the scope of mentioned Law:
- All income related to patents to be obtained by Producing Companies belonging to natural or legal persons active in the area is exempted from all kind of tax for five years;
- The Company responsible for Management is exempted from all kinds of tax, duties and charges related to application of this Law;
- The software in the area and income generated from production activities (excluding staff costs of companies) related to R&D, which only belong to Income and Corporate Tax liables, are exempted from Tax and Corporate Tax for five years as of the operation date of the business.
- The Cabinet is authorized to prolong the above stated period.
Cancellation of Misused Rights
Individuals who do not obey this law and relevant legislation are warned by the Ministry and asked to act correspondingly with required aim. If individuals does not take action accordingly with required aim in three months, the activation of the business can be cancelled in accordance with the report given by Ministry Evaluation and Audit Commission and is taken out of this law by the confirmation of Cabinet Decision.