m-POS Era In Turkey: Tax Procedure Law General Communiqué No. 507 (On Safe Mobile Payment And Electronic Document Management System)

m-POS Era In Turkey: Tax Procedure Law General Communiqué No. 507 (On Safe Mobile Payment And Electronic Document Management System)


Revenue Administration have published the Tax Procedure Law General Communique No. 507 (on Safe Mobile Payment and Electronic Document Management System) ("Communique") on the official gazette of 01 June 2019.

The Communique is critical for the payment ecosystem as it opens doors for mobile app-based payment devices (e.g. m-Pos applications) to be used at face-to-face transactions. m-POS market couldn't take off in Turkey before due to the regulatory boundaries which are being lifted with the Communique. The use of electronic payment methods in brick-and-mortar retailers should be expected to expand with the Communique. In other words, mobile payment application market will soon to become quite active in Turkey.

The Definitions

The Communique establishes and defines a new type of system called "Safe Mobile Payment and Electronic Document Management System" (the "System"). "The System" refers to the payment processing mechanisms to be established by financial institutions or payment recording device manufacturers and permitted by the Ministry of Treasury and Finance. According to the Communique, the systems can become online after 01 September 2019.

Certain key definitions provided in the Communique are as follows:

  • "The System": "The system permitted by the Ministry [Ministry of Treasury and Finance] belonging to processes regarding the sale, payment/collection transactions carried out by the financial institutions or payment recording device manufacturers and private integrators and preparation, transmission, storage and submission of the financial documents in electronic form related to these transactions in accordance with the procedures and principles specified in the communiqué"
  • "Payment Accepting Device": "physical hardware or software applications that can process payments by accepting payment instruments."
  • "Payment instruments": "Physical / virtual cards that allow payment transactions to be made by banks, electronic money institutions and payment institutions, or software applications that do not have a physical nature, which contain information that can facilitate payments from accounts of such institutions (QR, NFC, etc.)."

Possible effects of the Communique

Under the current Turkish Law, to process card payments during transactions taking place in the physical mediums (i.e. physical shops, when seller and customer are face-to-face), the sellers are required to use a 'payment recording devices' ("PRD") (e.g. physical mobile POS devices, cash registers with PRD functionality). PRDs can directly upload transaction data to the Revenue Administration's systems and such devices can only be manufactured by authorized manufacturers (i.e. payment recording device manufacturers) in accordance with very strict technical requirements.

However, the Communique allows the use of other electronic and technological solutions by the sellers to process payments during physical transactions, by introducing the concept of Payment Accepting Device. Accordingly, the sellers are not necessarily required to use a physical POS device to process physical or virtual cards. Other hardware solutions (tablets, smartphones, NFC supported devices etc.) or software applications (apps, QR code readers etc.) will be possible to be used to process payments.

In order to offer payment solutions via a Payment Accepting Device in accordance with the Communique, following criteria must be fulfilled:

  • The System must be set up by a financial institution or payment recording device manufacturer in co-operation with a private integrator1. Later, the System must be given a permit by the Ministry of Treasury and Finance of Turkey.
  • The Payment Accepting Device provider must be a financial institution licensed by the Banking Regulation and Supervision Authority (e.g. banks, payment institutions, electronic money institutions) or a payment recording device manufacturer. If any other entity (including foreign payment solution providers) wishes to offer such solutions, it must co-operate with one licensed financial institution and a private integrator.
  • Payment Accepting Device must be capable of instantly preparing documentation regarding the transaction taking place in electronic form and issue them to the buyer in electronic or physical format. Yet, those institutions that will be providing the Payment Accepting Device shall be under the obligation to make the electronic documents and information regarding the transactions available to the Revenue Administration.


1. Private integrators are licensed entities (by the Revenue Administration) that provide outsourcing services as to issuing of electronic invoices. Private integrators provide information system infrastructure support to taxpayers whose systems are not capable of integrating with systems of Revenue Administration when issuing e-invoices. You may find the list of private integrators that are licensed by the Revenue Administration here.

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