Publications

Establishing a Company in Turkey

A Comprehensive Guide for International Investors

Turkey has become an increasingly attractive destination for global investors thanks to its strategic geographic location, young and dynamic population, and its role as a gateway to European, Middle Eastern, and Central Asian markets. With its investor-friendly legal framework, it is becoming progressively easier for foreign-capital companies to operate in Turkey.
This guide provides international investors with a detailed overview of the legal procedures, company structures, institutionalization processes, and investment incentives involved in establishing a company in Turkey.

1. Types of Companies That Can Be Established in Turkey

The first step for investors is to identify the most appropriate company type based on the scope and scale of their investment. Under the Turkish Commercial Code, the main types of companies available to foreign investors are:

a) Joint Stock Company (A.Ş.)

• Minimum capital requirement: 250,000 Turkish Lira
• Shareholders have limited liability based on their shareholding.
• Suitable for medium to large-scale investments, with the option for public offering.
• Managed by a Board of Directors; share transfers are relatively straightforward.

b) Limited Liability Company (Ltd. Şti.)

• Minimum capital requirement: 50,000 Turkish Lira
• May have up to 50 shareholders, either individuals or legal entities.
• Ideal for small and medium-sized enterprises, with a simpler setup and management structure.

c) Branch and Liaison Office

• Represents the foreign parent company directly in Turkey.
• A branch can carry out commercial activities, whereas a liaison office is limited to market research, promotion, and coordination.
• These entities do not have separate legal identity; the parent company holds full liability.

2. Company Formation Process

2.1. Developing a Business Plan and Conducting Market Research

A detailed business plan should be prepared, including analysis of the target sector, customer base, competitors, and financial projections. Turkey’s sectoral dynamics, local regulations, and incentive programs must be thoroughly examined.

2.2. Choosing the Appropriate Company Type

The most suitable company structure should be selected based on the scale of operations, capital requirements, partnership model, and strategic goals.

2.3. Reserving a Company Name

A unique company name must be reserved through the Turkish Trade Registry. Once reserved, it is protected for a specified period and cannot be used by others.

2.4. Preparing Incorporation Documents

Required documents—such as the articles of association, shareholder resolutions, and statements of business activity—must be prepared. These documents must be notarized and, if applicable, apostilled.

2.5. Registration with the Trade Registry and Tax Office

An application must be submitted to the relevant Trade Registry Office. Upon registration, the company receives a tax identification number and becomes operational.

2.6. Opening a Corporate Bank Account

A corporate bank account must be opened with a Turkish bank in the company’s name. Legal Turkey offers assistance throughout this process.

2.7. Obtaining Licenses and Permits

Sector-specific licenses (e.g., in healthcare, finance, energy) must be secured from the relevant regulatory authorities.

2.8. Registration with SGK and İŞKUR

Companies intending to hire employees must register with the Social Security Institution (SGK) and the Turkish Employment Agency (İSKUR).

2.9. Ensuring Accounting and Tax Compliance

Companies are legally required to work with a certified public accountant to ensure proper financial reporting and tax compliance.

2.10. Legal Compliance and Ongoing Legal Advisory

Ongoing legal support is essential to manage risks related to intellectual property, contracts, data protection, and local regulations. Legal Turkey offers comprehensive legal consultancy to ensure full compliance with Turkish laws.

3. Incentives for Foreign Investors

The Republic of Turkey offers various incentives to attract foreign investment:

• Under the Foreign Direct Investment Law, foreign-capital companies are granted equal rights as domestic companies.
• Free Zones provide benefits such as tax exemptions, customs advantages, and streamlined procedures for foreign-currency-generating activities.
• Investment Incentive Certificates offer support including VAT exemptions, customs duty exemptions, and employer social security premium contributions.
Establishing a company in Turkey is a transparent and efficient process when managed professionally. With the right legal structure, expert local guidance, and strategic planning, the Turkish market presents significant opportunities for international investors seeking to expand.
At Legal Turkey, we are committed to ensuring your investment journey in Turkey is smooth, secure, and successful.