Keep in mind that regulations can change, so it’s always best to confirm the most up-to-date requirements with a legal professional or the relevant government authorities in Turkey.
I. Choosing the Right Company Type
The first step is selecting the appropriate legal structure for your business. The most common types in Turkey are:
Sole Proprietorship (Şahıs Şirketi): Simplest form, suitable for small businesses with a single owner. The owner is personally liable for all business debts. Easy and inexpensive to set up.
Limited Liability Company (LLC) - Limited Şirket (Ltd. Şti.): The most popular structure, offering limited liability for its shareholders. Requires at least one shareholder and a minimum share capital.
Joint Stock Company (JSC) - Anonim Şirket (A.Ş.): Suitable for larger businesses with significant capital requirements. Requires at least one shareholder (previously five) and a higher minimum share capital. Offers the most robust corporate governance structure.
Joint Venture (Adi Ortaklık): An agreement between two or more parties to combine resources for a specific project or business purpose. Not a separate legal entity.
Commandite Company (Komandit Şirket): A partnership with two types of partners: general partners (who have unlimited liability) and limited partners (who have limited liability).
Cooperative (Kooperatif): An association of persons united to achieve a common economic goal, such as providing goods or services to its members.
For most foreign investors, the LLC (Limited Şirket) is the most common and practical choice. This guide will primarily focus on the LLC incorporation process.
II. Key Steps for Incorporating an LLC (Limited Şirket) in Turkey
Choosing a Company Name:
The company name must be unique and comply with Turkish Commercial Code regulations.
It must include the company’s activity field and the abbreviation “Ltd. Şti.” (for Limited Şirket).
Perform a name search at the relevant Trade Registry Office (Ticaret Sicil Müdürlüğü) to ensure availability.
Determining Share Capital:
The minimum share capital for an LLC is currently 10,000 Turkish Lira (TRY).
The capital must be divided into shares.
Preparing the Articles of Association (Ana Sözleşme):
This is a crucial document outlining the company’s name, address, purpose, share capital, management structure, and other key provisions.
It’s highly recommended to have this document drafted by a lawyer familiar with Turkish commercial law.
Key elements to include:
Company name and address
Company objectives and scope of business
Amount of share capital and allocation among shareholders
Management structure (directors, managers)
Representation of the company
Provisions for profit distribution, transfer of shares, and dispute resolution
Notarizing the Articles of Association:
The Articles of Association must be notarized by a Turkish notary public.
All founders must be present at the notary or provide a power of attorney.
Opening a Bank Account and Depositing Share Capital:
Open a company bank account at a Turkish bank.
A portion of the share capital (typically at least 25%) must be deposited into the bank account before registration with the Trade Registry. The remaining amount must be paid within two years.
Obtain a bank statement confirming the deposit of the share capital.
Registering with the Trade Registry Office (Ticaret Sicil Müdürlüğü):
Submit the required documents to the relevant Trade Registry Office where the company’s headquarters is located.
Required documents typically include:
Notarized Articles of Association
Application form
Identity documents of the shareholders and managers
Bank statement confirming share capital deposit
Tax identification number (Vergi Numarası) of shareholders (if applicable)
Chamber of Commerce registration form
Other supporting documents as required by the Trade Registry.
Pay the registration fees.
The Trade Registry Office will review the documents and, if approved, register the company.
Announcing the Company’s Establishment in the Trade Registry Gazette (Ticaret Sicil Gazetesi):
The company’s registration will be announced in the Trade Registry Gazette, making it officially established.
Obtaining a Tax Identification Number (Vergi Numarası):
Apply for a tax identification number from the local tax office (Vergi Dairesi).
Required documents typically include:
Trade Registry Certificate (Ticaret Sicil Tasdiknamesi)
Articles of Association
Identity documents of the managers
Rental agreement for the company’s office (if applicable)
Registering with the Social Security Institution (Sosyal Güvenlik Kurumu - SGK):
Register the company with the SGK as an employer.
This is necessary to comply with social security obligations for employees.
Obtaining a Business License (İşyeri Açma ve Çalışma Ruhsatı):
Apply for a business license from the relevant municipality (Belediye).
The requirements for a business license vary depending on the type of business and the municipality.
Bookkeeping and Accounting System:
Establish a proper bookkeeping and accounting system in accordance with Turkish accounting standards.
Engage a certified public accountant (Serbest Muhasebeci Mali Müşavir - SMMM) to manage your accounting and tax obligations.
III. Key Documents Required (Typical List)
This is a general list, and the specific documents required may vary slightly depending on the Trade Registry Office and the company type.
Application Form
Notarized Articles of Association
Identity Documents (passports for foreigners) of shareholders and managers
Residence Permits (for foreign shareholders and managers residing in Turkey)
Tax Identification Number (for foreign shareholders and managers, if applicable)
Bank Statement confirming the deposit of share capital
Power of Attorney (if someone is acting on behalf of the shareholder or manager)
Chamber of Commerce Registration Form
Photographs of shareholders and managers
IV. Important Considerations for Foreign Investors
Translation and Notarization: All documents in a foreign language must be translated into Turkish by a sworn translator and notarized.
Tax Residency: Determine the tax residency of the shareholders and managers. This will affect their tax obligations in Turkey.
Work Permits: Foreign managers and employees will need to obtain work permits to legally work in Turkey.
Real Estate Acquisition: Foreigners may be subject to restrictions on acquiring real estate in certain areas.
Legal and Financial Advice: It’s strongly recommended to seek legal and financial advice from experienced professionals who are familiar with Turkish regulations and can guide you through the process.
Double Taxation Treaties: Turkey has double taxation treaties with many countries. These treaties can help to avoid double taxation of income.
V. Estimated Timeframe
The incorporation process can take anywhere from 1 to 4 weeks, depending on the efficiency of the government agencies and the completeness of the documents.
VI. Costs Involved
The costs of incorporating a company in Turkey vary depending on the company type, the amount of share capital, and the professional fees charged by lawyers, accountants, and consultants. Costs to consider include:
Notary fees
Trade Registry fees
Publication fees in the Trade Registry Gazette
Accounting fees
Legal fees
Translation fees
VII. Where to Get Help
Lawyers: Experienced commercial lawyers in Turkey can guide you through the legal aspects of incorporation, draft the Articles of Association, and ensure compliance with regulations.
Certified Public Accountants (SMMM): Accountants can assist with setting up your accounting system, obtaining tax identification numbers, and complying with tax obligations.
Investment Consultants: Consultants specializing in foreign investment can provide guidance on all aspects of setting up a business in Turkey, including company incorporation, permits, and licenses.
Trade Registry Offices (Ticaret Sicil Müdürlüğü): The Trade Registry Offices are responsible for registering companies and can provide information on the requirements and procedures.
Invest in Turkey (Türkiye Yatırım Ajansı): The official investment promotion agency of Turkey can provide information and support to foreign investors.
Disclaimer: This information is for general guidance only and should not be considered legal or financial advice. It’s essential to consult with qualified professionals for specific advice related to your situation. Regulations are subject to change.
Comments