The inward processing regime (Dahilde İşleme Rejimi, DİR) is a customs procedure that allows raw materials, semi-finished goods and packaging to be used in manufacturing a product for export to be imported without customs duty and trade policy measures being applied. In return, an undertaking is given to export the processed product within a set period; once the undertaking is closed, the guarantee is released.
What problem does the inward processing regime solve?
A manufacturer buying inputs from abroad pays customs duty, any additional customs duty, anti-dumping duty and VAT when releasing those inputs for free circulation. If the product is then exported, these taxes travel abroad inside the cost and undermine price competitiveness. DİR removes this burden for export-oriented production. For example, a company that imports steel sheet from the Far East, produces white-goods casings and sells the entire output to Europe can start production without paying the taxes on the sheet; none of the items in the customs duty calculation, from customs duty to import VAT, is paid out in cash.
What is the difference between the suspension system and the drawback system?
Article 108 of Customs Law No. 4458 (Gümrük Kanunu) divides the regime into two systems:
| Criterion | Suspension system | Drawback system |
|---|---|---|
| Status of the goods | Goods not in free circulation | Goods released for free circulation |
| Taxes | Not paid; secured by a guarantee | Paid on import |
| After export | The guarantee is released | The import duties collected are refunded |
| Cash effect | No tax money is paid out at all | Cash is tied up between payment and refund |
Under the suspension system, the use of equivalent goods is also possible: the product made with an input of the same quality sourced domestically is exported first, and the imported goods are brought in later. The equivalent goods must be identical to the imported goods at least at the 8-digit tariff classification level and in terms of commercial quality and technical characteristics.
What are DİİB and DİZİN, and who issues them?
Only persons established in the Customs Territory of Türkiye can benefit from the regime. For activities requiring simple processing and labour, an Inward Processing Permit (Dahilde İşleme İzni, DİZİN) is obtained from the customs directorate; for more complex production, an Inward Processing Authorisation Certificate (Dahilde İşleme İzin Belgesi, DİİB) is obtained from the Ministry of Trade (Ticaret Bakanlığı). The application must show that the use of the imported goods in the product can be identified, that the economic interests of domestic producers are not harmed and that the activity creates added value. The certificate lists the inputs to be imported, the product to be exported and the rate of yield (how many units of product are obtained from a given quantity of input). The legal basis is the Customs Law, Inward Processing Regime Decision No. 2005/8391 and the related communiqués.
How does the regime work step by step?
- An application for a DİİB or DİZİN is made with the production recipe and wastage rates.
- The inputs are imported with the certificate number entered in the declaration; under the suspension system, the taxes are secured by a guarantee.
- Where necessary, inputs can also be sourced domestically under the certificate.
- The finished product is exported within the certificate's validity with export declarations linked to the certificate.
- An application to close the undertaking is made; the guarantee is released or the taxes are refunded.
Time limits and closing the undertaking
A DİİB or DİZİN is issued for a maximum of 12 months. For projects whose production exceeds this period, such as shipbuilding or complete plants, a certificate can be issued for the duration of the project; an extension can also be requested on justified grounds. To close, an application is made to the regional directorate of the Ministry of Trade within 3 months at the latest from the end of the certificate's validity for a DİİB, and to the relevant customs office within 1 month at the latest from the end of the permit's validity for a DİZİN. If the undertaking is not fulfilled, the taxes are collected with interest and sanctions are also applied.
Common mistakes
- Declaring a rate of yield and wastage that differ from actual production; a shortfall in exports appears at closure.
- Not entering the certificate number in the export declaration; that export does not count towards the undertaking.
- Not putting the expiry date and the 3-month closing period in the calendar.
The reverse direction, i.e. domestic goods being processed abroad and brought back, is governed by the outward processing regime, while the temporary use of foreign goods without processing is governed by the temporary admission regime. For the certificate application and the closing file, tax and exemption consultancy can be obtained.