USA Tariffs: What Lies Ahead for the M&A Consultant?

While these measures are positioned by the U.S. as part of a broader strategy to "make America rich again" the response from other nations has been markedly different. Many have warned that such policies are expected — at least in the short term — to generate inflationary pressures, disrupt supply chains, cause volatile currency fluctuations, and potentially slow down global trade, all while aiming to relocate production capacity closer to the U.S., alongside its intellectual design capabilities.

Although Turkey was among the countries subject to the lowest level of newly imposed U.S. tariffs (set at 10%), the interconnected nature of the global economy means that the ripple effects of these so-called "trade wars" will inevitably have a notable impact on Turkey as well, for better or worse.

China’s early response—ranging from export restrictions on rare earth elements to the introduction of retaliatory tariffs on U.S. goods—suggests we may be entering a more fragmented and confrontational phase in global trade. Other nations are likely to adopt similar measures, contributing to an increasingly complex and protectionist international environment.

In this context, investors are being forced to reassess their capital allocation strategies and geographic footprints—particularly in industries that are heavily reliant on global supply chains.

From a textbook perspective, both sanctions and tariffs are tools designed to “change behavior”—leveraged as means to force, discourage, or persuade the behavior of the targeted parties. Accordingly, we anticipate that these instruments will have a material influence on M&A activity, shaping deal appetite, sectoral focus, country strategies, and risk frameworks.

Therefore, from an M&A advisory standpoint, we wanted to highlight a few early reflections and begin positioning ourselves—and our clients—for what lies ahead:

• MAC (Material Adverse Change) Clauses Under the Microscope: Walk-away or Price Adjustment?
  An increasingly common client question we are receiving is whether newly imposed tariffs may constitute a material adverse change (MAC) sufficient to walk away from or renegotiate a pending transaction. Under many deal frameworks, especially those involving U.S. operations or heavily export-reliant supply chains, such economic shocks may qualify—if they present an unknown, disproportionate risk affecting the core commercial rationale of the transaction.
  
  In recent weeks, we have been revisiting various agreements—including M&A transactions as well as customer and procurement contracts—to assess the potential implications of the newly announced tariff increases. In particular, we are evaluating whether these developments may MAC clauses or justify pricing adjustments in ongoing or contemplated deals.
  
  From a legal perspective, we do believe that, in cases where target companies have significant exposure to these tariffs, the magnitude and sudden nature of these expenses may indeed constitute a triggering event under typical MAC clause formulations. As such, investors may be justified in reconsidering their commitments—whether by seeking price renegotiations or, in certain cases, walking away from transactions altogether.
  
  At the drafting stage, on the other hand, building contractual flexibility has become more critical than ever. Well-drafted “walk-away” clauses, “force majeure” provisions, “change-in-law” clauses, and other protective covenants during negotiations can offer clients vital safeguards against unforeseen developments in the coming days.
  
  A useful tip to keep in mind: if the agreement is still in draft form and hasn’t yet been signed, the existence of these tariffs is already a known matter. This makes it more difficult to classify them as an “unknown risk” later on. To avoid any misunderstandings or potential disputes, it would be best to clearly refer to the tariffs and sanctions etc. explicitly in the contracts, rather than relying on general language—just as we previously did by adding specific reference to the COVID-19 alongside the term ‘pandemic’ in earlier agreements.
• The Ongoing Need to Monitor Sanctions:
  One thing we know about the U.S. is that they are great executers of sanction laws. It will certainly be interesting to observe whether President Trump continues to use tariffs as a “foreign policy tool” to bring countries to the negotiation table during this administration.
  
  That being said, forming the right strategic alliances is not merely a commercial decision—it will be also a political one. Accordingly, Turkish stakeholders and internationally active businesses must stay continually informed and strategically advised with respect to U.S. sanctions laws, which are often interpreted broadly and applied with retroactive scrutiny.
  
  If your company is considering investment in jurisdictions such as China, Vietnam, or others subject to U.S. scrutiny, it is critical to assess how such moves may affect your long-term relations with U.S. partners, regulators, and markets.
• Can Turkey Emerge as a Transit Hub?
  Conversely, some may see new and unique opportunities arising out of the geopolitical reordering and due to the relatively low level of imposed U.S. tariffs set at 10% for Turkey —particularly if Turkey can position itself as a “transit hub” or “nearshoring hub” for goods and services destined for the U.S. market. However, this opportunity comes with considerable compliance risk. U.S. sanctions laws are notoriously expansive, and enforcement authorities frequently trace even indirect links to embargoed jurisdictions. Turkish businesses exploring these channels should be careful and well-informed with risk strategy and appropriate guidance from legal and regulatory advisors, to mitigate legal and reputational risks.
• Keeping Up with the Foreign Direct Investment (FDI) Laws and Clearances:
  Foreign direct investment (FDI) regimes around the world are also expected to evolve in response to the Trump administration’s renewed policy stance. In particular, the U.S. Committee on Foreign Investment (CFIUS) is expected to intensify its scrutiny of transactions through the lens of “national security” and the principle of “reciprocity”. Transactions that are seen as offering limited or no strategic value to the U.S.—so-called “take but not give” deals— may increasingly face rejection from the U.S. Committee on Foreign Investment (CFIUS).
  
  Therefore, going forward, we expect that foreign investments will, in general, be required to demonstrate a clear alignment with the national interests of the relevant countries in order to secure regulatory approval. This will be the new reality. For Turkish investors and corporates pursuing outbound cross-border deals, this creates a dual imperative: keeping up to date with shifting global FDI rules while also monitoring any parallel developments in Turkey’s own investment screening framework.
  
  As M&A counsel, our role is no longer confined to legal drafting or merely ensuring compliance—we must also support our clients in evolving as strategic storytellers of their own deal narrative, helping them craft a persuasive story that builds trust with foreign regulators and preparing submissions to authorities with this mindset in mind, to secure timely approvals.
• Expected M&A Deal Activity:
  Despite these challenges, there is still reason for measured optimism the Turkish M&A world. First, Turkey stands to benefit from global supply chain realignments, as companies seek to de-risk operations and minimize exposure to geopolitical tensions. Turkey’s strategic location and potential as a regional hub continue to attract investor interest.
  
  Concurrently, private equity (PE) exits have already been at low levels for several years, creating a backlog of pent-up demand. This demand is now beginning to surface—potentially paving the way for a new wave of PE exit activity, particularly via increasing number of PE-to-PE deals.
  
  While valuations in certain sectors—particularly industrials exposed to tariffs—may face downward adjustments, an uptick in distressed M&A activity is anticipated.
  
  Meanwhile, sectors such as technology, AI, robotics, and energy are expected to remain highly attractive. To draw higher levels of inbound foreign direct investment during these unprecedented times, it is essential for Turkey to focus on creating value and building strategic capacity in these critical industries.
  
  But the bottom-line question still remains: Will this new world order stimulate increased M&A activity, or will it instead trigger a slowdown—perhaps even a recession—in Turkey’s inbound and outbound M&A market? While signals are mixed, it is still too early to have a clear answer. What is certain, however, is the need to stay agile and well-prepared as both risks and opportunities continue to unfold.

Key Takeaways:

• Clients will demand sharper insight at the intersection of tariff and sanctions regulations, evolving political stances, and commercial alliances.
• Contractual innovation and legal engineering will be essential—particularly through the inclusion of expanded Material Adverse Change (MAC) clauses, walk-away provisions, price-adjustment mechanisms, and recalibrated break fees.
• Deals will be more politicized. Cross-border deals will require more upfront preparation, better storytelling, and tighter alignment with the relevant countries’ “national interest”.
• Consultants and lawyers who remain consistently up to date and can bridge financial and legal analysis with global policy developments will become the go-to advisors for clients.

Senior Associate , DİLARA KAYMAZ