Turkey’s CMB publishes Guide on Green Debt Instruments/Lease Certificates 


After the 3 November 2021 publication of the Draft Guide on Green Bonds and Green Lease Certificates, the Capital Markets Board (CMB) introduced the Applicable Version of the Guide on 25 February 2022. Our comments on the Draft Guide are available here. Similar to the Draft Guide, the Applicable Guide can regulate projects that are financed with green/sustainable debt instruments, including the use and management of the funds obtained from the issuance, and public disclosure and obligations regarding reporting and provision of external appraisal services. Since this Guide has been introduced to regulate and supervise the procedures and principles regarding new capital market institutions and instruments, the matters contained in it are deemed CMB decisions

The main differences between the Draft and Applicable guides are as follows:


  • While the Draft Guide covered green debt instruments, the Applicable Guide expanded the scope and included sustainable debt instruments as well. In this context, sustainable debt instruments refer to publicly traded or not-all debt instruments and lease certificates used to partially or fully finance or refinance projects that have positive environmental and social impact. Therefore, financing projects with a positive social impact are included in sustainable debt instruments.
  • The definition of external appraisal service providers, which was narrower in the Draft Guide, is expanded in the Applicable Guide. External appraisal service providers refer to the following:
  • Some new definitions (e.g. second party opinion, sustainable debt instruments, etc.) are added to remove ambiguities.
  • It is made clear that green and sustainable debt instruments cannot be converted into debt instruments if they do not comply with the Applicable Guide.
  • One of the important changes not in the Draft Guide is that a separate issue ceiling needs to be obtained from the CMB for both domestic and international issuances.
  • A maximum 36 months is recommended as the retrospective period required for research and development expenditures on the financing of eligible refinanced green projects.

Reporting and disclosure

  • Regarding the determination of the eligible green projects, issuers can benefit from the ICMA Climate Transition Finance Handbook in terms of public disclosure principles and climate transition strategies.
  • The relationship between green projects and international commitments such as the UN Sustainable Development Goals and Paris Agreement, and the qualitative and quantitative impact criteria to be used to demonstrate the contribution to environmental goals should be disclosed in the framework document.
  • The issuer should disclose to the public in the framework document how it plans to manage the unused portion of the fund (i.e. uses in short-term financial instruments and liquid assets) until it is allocated to the relevant green projects.
  • Up-to-date information on the use of funds and important developments will be disclosed in an impact report in line with the CMB’s regulations on public disclosure of material events. Projected and actual environmental impact should also be disclosed.
  • In addition, it is obligatory to disclose qualitative performance indicators and quantitative performance measures (e.g. energy capacity, electricity production, reduced or prevented greenhouse gas emissions, number of people with access to clean energy, decrease in water use, decrease in the number of cars, etc.) in the impact report while this disclosure was a recommendation in the Draft Guide.
  • In international issuances, the Turkish translation of the fund usage reports compliant with foreign standards must be disclosed to the public on the Public Disclosure Platform or on the issuer's website three months after the preparation of the report if the issuer is a PDP member.

External Appraisal Service Providers

  • The General Principles of External Appraisal Service Providers, which were not included in the Draft, are also specified in the Applicable Guide. Honesty and integrity, objectivity, professional competence and care, and confidentiality are ethical and professional rules that must be followed by these service providers. In addition, they should be compliant with the following:
  • In addition, the reports prepared as part of an external appraisal service should contain the following minimum information:
  • Without any exception, the organisation that gives the second party opinion should be independent of the institution from which the issuer receives consultanting regarding the debt instrument framework document. The Draft Guide states that, under certain conditions, a second party opinion could be given by the organisation that provided consultancy to the preparation of the framework document.
  • Though a separate point, it is decided to reduce the CMB fees by 50% for the issuance of debt instruments under the Applicable Guide.


The Applicable Guide aims to carry out the issuance of green/sustainable debt instruments in accordance with the best practices and standards in international financial markets, and to increase transparency, honesty, consistency, and comparability in the financing of sustainable/green projects. Therefore, as this is the first regulation made in this area, it is expected that issuers of such instruments will be subject to more scrutiny and investors will have increased protection against greenwashing practices.

For more information on Green Finance in Turkey, contact your CMS client partner or your local CMS expert: Hülya Kemahlı and Arcan Kemahlı.