Planning to buy an existing power plant in Turkey? Learn the 30 most important legal risks involving EMRA licenses, grid connection, shareholder disputes, environmental permits, EPC contracts, tax liabilities, and energy regulations in this comprehensive 2026 legal guide.

Turkey has become one of the most attractive energy investment markets in Europe, offering opportunities to acquire operating solar power plants (GES), wind farms (RES), hydroelectric power plants (HES), geothermal facilities (JES), biomass plants, natural gas power stations, and battery energy storage projects (BESS).

Acquiring an operational power plant can significantly reduce development risk compared with building a new facility. Existing projects often already have land rights, grid connections, operational permits, financing structures, and an established revenue history. However, they may also carry hidden legal liabilities capable of reducing the value of the investment or resulting in significant post-closing disputes.

Foreign investors frequently focus on electricity production, financial performance, and technical inspections while overlooking regulatory, corporate, environmental, contractual, and tax risks.

Energy acquisitions in Turkey are primarily governed by:

• Electricity Market Law No. 6446
• Turkish Commercial Code No. 6102
• Turkish Code of Obligations
• Foreign Direct Investment Law No. 4875
• Renewable Energy Law No. 5346
• EMRA (EPDK) Regulations
• Environmental legislation
• Competition legislation
• Tax legislation

Foreign investors may generally establish and acquire Turkish companies under the same conditions as domestic investors, but electricity generation activities remain subject to sector-specific licensing and regulatory requirements administered by EMRA (EPDK). (https://www.invest.gov.tr/en/investmentguide/pages/establishing-a-business.aspx)

This 2026 Updated Legal Guide explains the 30 most important legal risks foreign investors should evaluate before purchasing an existing power plant in Turkey.

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Why Legal Due Diligence Is Critical

A power plant may appear profitable while carrying hidden risks involving:

• Regulatory compliance
• Environmental permits
• Corporate governance
• Tax liabilities
• Financing obligations
• Grid connection rights
• Shareholder disputes
• EPC claims
• Litigation
• Administrative sanctions

Legal due diligence protects both the investment and future financing.

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30 Legal Risks Every Foreign Investor Should Know

Regulatory Risks

1. Generation License Validity

Verify that the EMRA generation license remains valid and complies with current regulatory requirements.

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2. License Amendment Obligations

Determine whether previous modifications required regulatory approval.

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3. License Transfer Restrictions

Some corporate transactions may require regulatory notifications or approvals before ownership changes become effective.

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4. Administrative Investigations

Review whether EMRA has initiated:

• investigations
• audits
• administrative sanctions
• compliance proceedings

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5. Outstanding Regulatory Violations

Identify unresolved regulatory deficiencies before acquisition.

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Corporate Risks

6. Shareholder Disputes

Review:

• shareholder litigation
• deadlock situations
• minority shareholder claims

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7. Corporate Authority

Confirm that the seller has authority to complete the transaction.

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8. Articles of Association

Review transfer restrictions and voting rights.

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9. Board Resolutions

Confirm that corporate approvals have been properly adopted.

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10. Existing Joint Venture Agreements

Identify change-of-control provisions.

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Land Risks

11. Ownership Verification

Confirm legal ownership of all project land.

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12. Easements

Review:

• transmission easements
• access rights
• utility rights

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13. Mortgage Review

Search land registry records for mortgages.

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14. Expropriation Issues

Determine whether public authority proceedings exist.

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15. Zoning Compliance

Verify current zoning status.

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Environmental Risks

16. Environmental Impact Assessment (EIA)

Review the validity of all environmental approvals.

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17. Environmental Violations

Check for:

• pollution investigations
• administrative fines
• compliance notices

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18. Waste Management

Verify compliance with waste disposal obligations.

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19. Water Rights

Review applicable permits where relevant.

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20. Protected Areas

Determine whether new environmental restrictions affect future operations.

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Grid Connection Risks

21. Connection Agreement

Review:

• connection rights
• technical obligations
• termination provisions

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22. Capacity Allocation

Confirm available connection capacity.

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23. System Usage Agreements

Verify ongoing compliance.

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Commercial Risks

24. EPC Warranty Claims

Review outstanding contractor liabilities.

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25. O&M Agreements

Assess termination rights and service obligations.

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26. Power Purchase Arrangements

Review pricing mechanisms, assignment clauses, and termination provisions where electricity is sold under contractual arrangements.

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Financial Risks

27. Existing Financing

Review:

• loan agreements
• security documents
• financial covenants

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28. Tax Liabilities

Investigate:

• VAT
• corporate tax
• withholding tax
• stamp tax
• outstanding assessments

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29. Pending Litigation

Review:

• court proceedings
• arbitration
• administrative disputes

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30. Insurance Coverage

Confirm:

• operational insurance
• business interruption insurance
• liability insurance
• environmental insurance

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Additional Documents That Should Be Reviewed

Investors should obtain:

• Generation License
• Trade Registry records
• Articles of Association
• Shareholder Register
• Land Registry records
• Grid Connection Agreement
• System Usage Agreement
• EIA Decision
• EPC Contract
• O&M Agreement
• Financing Agreements
• Mortgage Documents
• Insurance Policies
• Tax Returns
• Financial Statements
• Litigation Reports
• EMRA Correspondence
• Environmental Audit Reports

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Common Mistakes Made by Foreign Investors

Foreign buyers frequently:

• Focus only on electricity production.
• Ignore regulatory investigations.
• Fail to review shareholder agreements.
• Overlook land title issues.
• Ignore tax liabilities.
• Fail to review financing documents.
• Underestimate environmental risks.
• Neglect post-closing integration planning.

These mistakes often lead to unexpected costs after completion.

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Best Practices Before Closing

Before purchasing a power plant:

• Conduct comprehensive legal due diligence.
• Verify EMRA compliance.
• Review all permits and licenses.
• Search land registry records.
• Analyze financing arrangements.
• Review environmental compliance.
• Confirm tax status.
• Negotiate robust warranties and indemnities.
• Obtain specialist Turkish legal advice before signing the SPA.

Early legal planning significantly reduces acquisition risk.

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Why Professional Legal Assistance Is Essential

Power plant acquisitions require expertise in:

• Electricity Market Law.
• Turkish Commercial Code.
• Renewable Energy Law.
• EMRA regulations.
• Environmental law.
• Corporate law.
• Tax law.
• Competition law.
• Project finance.
• International arbitration.

An experienced Turkish energy lawyer can:

• Conduct comprehensive legal due diligence.
• Review regulatory compliance.
• Analyze corporate governance.
• Investigate environmental liabilities.
• Negotiate Share Purchase Agreements (SPA) and Asset Purchase Agreements (APA).
• Review financing documents.
• Structure the acquisition efficiently.
• Represent investors before EMRA and Turkish courts.

Professional legal guidance substantially reduces transaction risk and protects long-term investment value.

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Frequently Asked Questions

1. Can foreign investors purchase an existing power plant in Turkey?

Yes. Foreign investors may generally acquire Turkish energy companies under the Foreign Direct Investment Law, subject to compliance with electricity market regulations and any sector-specific approval or notification requirements.

2. Is an EMRA license transferred automatically after a share acquisition?

Not necessarily. Whether regulatory approval or notification is required depends on the structure of the transaction and the applicable electricity market legislation. The licensing implications should be analyzed before signing.

3. Why is land due diligence so important?

Land ownership disputes, easements, zoning restrictions, mortgages, or expropriation issues may significantly affect the value and operation of the power plant.

4. Should investors review environmental permits?

Yes. Investors should verify that all required environmental approvals remain valid and determine whether there are any pending investigations, compliance notices, or administrative sanctions.

5. What is the biggest legal risk in a power plant acquisition?

The most significant risks typically involve regulatory non-compliance, licensing issues, hidden liabilities, environmental obligations, financing restrictions, and inadequate contractual protections.

6. Should investors review financing documents before closing?

Absolutely. Existing loan agreements, security packages, financial covenants, and lender consent requirements may materially affect the transaction.

7. Why are warranties and indemnities important?

Well-drafted warranties and indemnities allocate legal risk between buyer and seller and provide remedies if undisclosed liabilities are discovered after closing.

8. Why should foreign investors hire a Turkish energy lawyer?

A Turkish energy lawyer can conduct legal due diligence, review EMRA compliance, analyze land and environmental risks, negotiate acquisition agreements, coordinate regulatory processes, advise on tax and financing issues, and help ensure that the investment is completed in compliance with Turkish law while minimizing legal and commercial risks.

Legal Support – Contact Our Energy and M&A Lawyers

Acquiring an operating power plant in Turkey requires a thorough understanding of energy regulation, corporate law, environmental compliance, financing structures, and commercial contracts. Comprehensive legal due diligence before signing can prevent costly disputes and protect the long-term profitability of your investment.

Fırat Fesih Kaya and our legal team advise foreign investors, infrastructure funds, independent power producers, banks, EPC contractors, multinational energy companies, and institutional investors on power plant acquisitions, legal due diligence, EMRA licensing, project finance, shareholder agreements, renewable energy investments, regulatory compliance, international arbitration, and all aspects of Turkish energy and commercial law.

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Office Phone: +90 312 434 22 22

Email: info@firatfesihkaya.av.tr

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