Law No. 7552 on Climate: What Does It Bring?

Climate change continues to be one of the major global issues requiring urgent solutions. In this regard, Turkey has taken a significant step by enacting Law No. 7552 on Climate (the “Law”), which was adopted by the Grand National Assembly of Turkey on July 2, 2025 and published in the Official Gazette on July 9, 2025, thereby entering into force. The Law establishes a comprehensive legal framework to combat climate change in line with the goals of green growth and net-zero emissions.

The primary objective of the Law is to ensure action against climate change in accordance with Turkey’s net-zero emission target set for 2053 and its green development vision. The Law regulates a series of activities and instruments aimed at enhancing the country's international competitiveness and protecting various sectors—particularly the economy, cities, agriculture, and food—from the adverse impacts of climate change.

A. Combating Climate Change

1. Reduction of Greenhouse Gas Emissions

Under the Law, practices aimed at reducing greenhouse gas emissions will be implemented within the framework of Turkey’s Nationally Determined Contribution (“NDC”), the 2053 net-zero emission target, and strategy documents and action plans published by the Climate Change Presidency (the “Presidency”).

In this context, public and private sector actors operating in the sectors defined in the NDC are obliged to implement measures to reduce greenhouse gas emissions in line with the net-zero emission target and the principles of a circular economy.

Key measures set forth in the Law include increasing efficiency in the use of energy, water, and raw materials; preventing polluting effects at their source; promoting the use of renewable energy sources; reducing the carbon footprint; supporting the use of low-carbon or clean fuels and raw materials; expanding electrification; developing and adopting environmentally friendly technologies; and establishing, implementing, and monitoring a zero-waste system.

2. Adaptation to Climate Change

The Law provides for the identification of adaptation measures to minimize the adverse effects of climate change within the scope of the authority and responsibilities of public institutions and organizations. In this context, it is expected that planning tools will be developed at national, regional, and local levels by taking into account risks and vulnerabilities arising from climate change, and that corresponding impact and risk analyses will be prepared and implemented.

Adaptation measures set forth in the Law include: protecting water resources; conserving ecosystems and biodiversity; preventing land degradation; preserving and maintaining carbon sink areas as part of efforts to combat desertification and erosion; ensuring food security to support the sustainability of the agricultural sector; and enhancing societal and environmental resilience against climate-induced disasters.

B. Financing Instruments

The Law envisions the establishment of various financing instruments within the scope of combating and adapting to climate change. In this regard, it aims to develop insurance mechanisms to address losses and damages caused by climate change, promote green and sustainable financing tools—particularly capital market instruments—and implement various support and incentive schemes for activities related to greenhouse gas emission reductions and climate change adaptation.

C. Emissions Trading System and Carbon Market Mechanisms

The Law provides for the establishment of an Emissions Trading System (“ETS”) aimed at reducing greenhouse gas emissions through market-based mechanisms. Within this framework, the ETS is defined as a market instrument to be established by the Presidency, which operates on the principle of setting a cap on greenhouse gas emissions and allows for the trading of emission allowances at both national and international levels.

The operation of the ETS market will be carried out by the Energy Markets Operation Joint Stock Company. As the market operator, this entity will be responsible for managing the processes related to emissions trading activities—including the issuance, transfer, cancellation, and retirement of allowances—through a dedicated transaction registry system.

Under the Law, facilities falling within the scope of the ETS are required to obtain a greenhouse gas emission permit within three years from the effective date of the Law. This period may be extended by the Presidency for up to two additional years upon a decision by the Carbon Market Board.

The allowances in question will be tradable on the ETS market and will be transferable in nature. These allowances, issued in dematerialized form in electronic format, grant the right to emit one ton of carbon dioxide equivalent greenhouse gas for a specified period. Additionally, facilities will be able to meet their allowance obligations through offsetting by using an equivalent amount of carbon credits. The Presidency will establish a national carbon crediting and offsetting system and will determine the procedures and principles governing its operation.

The key concepts included in the Law and relevant to the subject are as follows:

 D. Administrative Sanctions and Pilot Phase Implementation

The Law stipulates various administrative fines for violations such as operating without a greenhouse gas emission permit or failing to surrender sufficient allowances within the prescribed deadlines.

However, before the full implementation of the ETS, a pilot phase is planned during which administrative fines will be reduced by 80%. The scope, duration, and implementation principles of the pilot phase will be determined by the Carbon Market Board, taking into account the opinions of relevant public institutions, private sector entities, and civil society organizations.

E. Conclusion

With the enactment of the Law, which establishes the roadmap for achieving the net-zero emission target by 2053, a new compliance process has begun for companies. This process is not limited to ETS and carbon market regulations but will also lead to comprehensive changes in financial markets through the development of green and sustainable financing instruments.

Furthermore, the Law strengthens Turkey’s alignment with its international climate commitments under the Paris Agreement and facilitates the integration with the European Union’s Carbon Border Adjustment Mechanism, thereby supporting our country’s more effective participation in global carbon markets.