Introduction
Turkey has become an increasingly attractive jurisdiction for foreign investors seeking access to regional markets spanning Europe, Asia, and the Middle East. With a large domestic consumer base, developed banking infrastructure, and a relatively liberal foreign investment regime, Turkey offers significant business opportunities.
One of the most common questions foreign entrepreneurs and investors ask is: How to establish a company in Turkey?
The incorporation process in Turkey is structured, relatively fast, and governed primarily by the Turkish Commercial Code (TCC). However, compliance with procedural, tax, and regulatory requirements is essential to avoid legal complications.
This guide provides a detailed, step-by-step explanation of how to establish a company in Turkey, covering company types, capital requirements, documentation, trade registry registration, post-incorporation obligations, and practical considerations for foreign investors.
1. Legal Framework for Company Formation
Company formation in Turkey is primarily regulated under:
- Turkish Commercial Code No. 6102
- Foreign Direct Investment Law No. 4875
- Trade Registry Regulation
- Tax Procedure Law
- Social Security legislation
Foreign investors enjoy equal treatment with Turkish nationals under the Foreign Direct Investment Law.
No prior governmental approval is required in most sectors.
2. Choosing the Appropriate Company Type
Before establishing a company in Turkey, the investor must choose the appropriate legal structure.
The most common types are:
1️⃣ Joint Stock Company (Anonim Şirket – A.Ş.)
- Minimum capital: 250,000 TRY (subject to updates)
- Suitable for large-scale investments
- Shares may be transferred more easily
- Required for certain regulated sectors
2️⃣ Limited Liability Company (Limited Şirket – Ltd.)
- Minimum capital: 50,000 TRY
- More common for SMEs
- Simpler governance structure
Most foreign investors choose either A.Ş. or Ltd.
3. Step 1: Drafting the Articles of Association
The incorporation process begins with drafting the Articles of Association (AoA).
The AoA must include:
- Company name
- Registered office
- Business activities
- Share capital
- Shareholding structure
- Management structure
Certain sectors may require specific wording.
The AoA must comply with mandatory provisions of the Turkish Commercial Code.
4. Step 2: Online Registration via MERSIS
Turkey uses an electronic registry system called MERSIS (Central Registry Record System).
The incorporation process involves:
- Creating company draft in MERSIS
- Uploading required information
- Generating draft Articles of Association
After digital approval, documents are submitted to Trade Registry.
5. Step 3: Capital Requirements
The minimum capital requirements are:
- A.Ş.: 250,000 TRY
- Ltd.: 50,000 TRY
For Joint Stock Companies:
- At least 25% of subscribed capital must be paid before registration.
- Remaining capital must be paid within 24 months.
For Limited Companies:
- Capital may be paid within 24 months after registration.
Capital may be contributed in:
- Cash
- In-kind assets (subject to valuation)
6. Step 4: Notarization and Signature Declarations
Company representatives must:
- Sign signature declarations before notary
- Authorize representation powers
Foreign shareholders may appoint representatives via notarized and apostilled power of attorney.
7. Step 5: Trade Registry Application
The company becomes legally established upon registration at the Trade Registry Office.
Required documents include:
- Articles of Association
- Founders’ declarations
- Capital payment proof
- Signature declarations
- Lease agreement for registered address
- Bank letter confirming capital deposit
Upon registration:
- Company acquires legal personality.
8. Step 6: Tax Registration
After registration:
- Company must register with local Tax Office.
- Tax identification number is issued.
Tax office may conduct:
- Address verification inspection.
Corporate income tax rate is currently 25% (subject to legislative changes).
9. Step 7: Social Security Registration
If company hires employees:
- Must register with Social Security Institution (SGK).
- Employer number is issued.
Failure to register employees may lead to administrative fines.
10. Opening a Corporate Bank Account
Company must:
- Open corporate bank account
- Deposit capital (if not fully paid before registration)
Banks conduct:
- KYC checks
- Shareholder verification
Foreign shareholders may need tax number.
11. Foreign Shareholder Considerations
Foreign individuals and entities may:
- Own 100% of Turkish company shares
- Serve as directors
- Repatriate profits freely
No local partner is required in most sectors.
Certain regulated sectors (banking, energy, defense) may require approval.
12. Estimated Timeline
The process of establishing a company in Turkey typically takes:
- 3 to 7 business days (if documentation is complete)
Delays may occur due to:
- Incomplete documents
- Foreign document apostille procedures
- Sector-specific approvals
13. Corporate Governance Structure
After incorporation:
- Board of Directors (A.Ş.) must be appointed.
- Managers must be appointed in Ltd.
Companies must maintain:
- Share ledger
- Board decision book
- General assembly book
Proper corporate record keeping is mandatory.
14. Accounting and Audit Obligations
Companies must:
- Keep statutory books
- Prepare financial statements
- Submit tax declarations
Certain companies may be subject to:
- Independent audit requirements
Audit thresholds depend on company size.
15. Common Post-Incorporation Compliance Obligations
After establishing a company in Turkey, ongoing obligations include:
- Filing corporate tax returns
- VAT declarations
- Withholding tax filings
- Trade registry updates for changes
- Annual general assembly meetings
Non-compliance may result in fines.
16. Costs of Company Formation
Typical costs include:
- Trade registry fees
- Notary fees
- Translation fees
- Consultancy/legal fees
Total cost varies depending on capital and structure.
17. Advantages of Establishing a Company in Turkey
Key advantages:
- Strategic geographic location
- Liberal foreign investment regime
- Developed banking sector
- Access to EU customs union
- Competitive labor market
Turkey allows full profit repatriation.
18. Common Legal Risks
Investors should consider:
- Currency volatility
- Tax compliance complexity
- Regulatory changes
- Labor law obligations
- Sector-specific licensing
Professional legal and accounting support is strongly recommended.
Conclusion
Establishing a company in Turkey is a structured and relatively efficient process governed by the Turkish Commercial Code and supported by a digital registration infrastructure. Foreign investors benefit from equal treatment under Turkish law and may fully own and control Turkish entities in most sectors.
However, beyond the initial incorporation process, ongoing tax, accounting, and regulatory compliance obligations must be carefully managed. Choosing the correct company type, drafting compliant articles of association, and ensuring proper registration are essential first steps toward successful market entry.
With proper planning and professional guidance, Turkey offers a practical and investor-friendly environment for corporate establishment and long-term business operations.
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