Easy Steps to Register Your Company in Turkey

Introduction

Setting up a company in Turkey can be a strategic move for entrepreneurs looking to tap into the diverse market of Eurasia. With its growing economy and favorable business environment, Turkey offers numerous opportunities for both local and foreign investors.

Types of Companies in Turkey

In the vibrant economic landscape of Turkey, entrepreneurs and investors from around the globe can select from a variety of company structures tailored to meet their business needs and investment scales. This diversity allows for flexibility and strategic alignment with both local and international market demands. Among the most common and beneficial types of companies in Turkey are the Joint Stock Company (A.Ş.), Limited Liability Company (Ltd. Şti.), and partnership-based entities like Commandite and Collective Companies. Understanding the distinct features, benefits, and limitations of each company type is crucial for making an informed decision that aligns with your business objectives.

Joint Stock Company (A.Ş.)

The Joint Stock Company, or Anonim Şirket (A.Ş.), represents a widely favored business structure for larger investments and corporate ventures. Ideal for those aiming to make a significant market impact, A.Ş. companies offer a high degree of flexibility in share transfers and are apt for public offerings, facilitating easier access to capital markets.

Limited Liability Company (Ltd. Şti.)

The Limited Liability Company, or Limited Şirket (Ltd. Şti.), is the go-to choice for small to medium-sized enterprises (SMEs) due to its relatively simple setup, operation, and the limited liability it offers its members. The Ltd. Şti. is particularly attractive to entrepreneurs and family-owned businesses looking for a structure that allows for direct management while also providing protection for personal assets against company liabilities.

Commandite and Collective Companies

For those interested in partnership models, Turkey offers the Commandite Company (S.K.) and the Collective Company (K.O.). These structures are less common but can be suitable for specific business scenarios, especially for professional services and family businesses looking for simple and traditional partnership arrangements.

Steps to Company Formation

Embarking on company formation in Turkey involves a series of strategic and bureaucratic steps, starting with crucial initial decisions on business structure and objectives. This journey to establish a corporate entity in Turkey navigates through numerous pivotal stages, each significant in laying the foundation for a successful business operation.

Choosing a Unique Company Name and Securing It

The first step in the process is selecting a unique name for your company. This name must not only capture the essence of your business but also comply with local regulations and be distinguishable from existing entities in the Turkish Commercial Registry. Securing the chosen name involves a preliminary search and reservation to ensure it is unique and unclaimed.

Power of Attorney to a Lawyer

Given the complexities involved in navigating Turkish company law and the registration process, granting a Power of Attorney to a local lawyer specialized in corporate law is a strategic move. This not only facilitates smoother interaction with government agencies and the Commercial Registry but also ensures that all legal requirements are meticulously met without unnecessary delays.

Gathering Necessary Legal Documents

The next phase focuses on accumulating all required legal documents. This includes preparing a comprehensive set of paperwork that outlines the structural, operational, and financial blueprint of your company. Key documents often encompass articles of association, identification documents of shareholders and directors, and any other paperwork mandated by Turkish law for the specific type of business entity being established.

Fulfilling All Regulatory Requirements

In tandem with document preparation, fulfilling regulatory requirements is paramount. This includes obtaining a tax identification number from the local tax office, which is a prerequisite for various subsequent steps such as opening a bank account and registering for VAT. Each shareholder and director must also provide passport copies, underscoring the need for clear identification in line with regulatory compliance.

Deciding the Capital of Your Company

Determining the capital investment for your company is a critical financial decision. This involves setting aside a specified amount of funds that reflects the scale and scope of your business operations. The chosen capital should align with the minimum requirements for the chosen type of company structure, ensuring compliance with Turkish commercial codes.

Choosing the Company Activity

Defining the primary activities of your company is crucial, as this will guide the operational framework and strategic direction. This decision involves selecting the appropriate NACE (Statistical Classification of Economic Activities in the European Community) codes that accurately represent your company's intended business activities, which is essential for registration and future compliance.

Signing a Rent Contract for Your Office Address

Securing a physical location for your company through a rent contract is not just a legal requirement; it also establishes your business's operational base.

Obtaining a Tax Number for Your Company

Obtaining a tax number is a critical step in the formation of your company in Turkey. This involves visiting the local tax office relevant to your company’s registered address and submitting the necessary documents, which typically include:

- The incorporation deed or articles of association.
- Identification documents of shareholders and directors.
- Proof of your company's registered address.

Upon submission, the tax office will issue a tax identification number for your company, which serves as a unique identifier for all tax-related activities and is essential for legal and financial operations within Turkey.

Providing Shareholders' Passport and ID Details

An essential part of the documentation process involves collecting and submitting the passport and official identification details of all shareholders. This step is crucial for verifying the identity of the company's legal owners and is a standard requirement for the registration process.

Registration with the Turkish Trade Registry

With all preparatory steps completed, the final procedural hurdle is the official registration of your company with the Turkish Trade Registry. This step formalizes your company's existence as a legal entity, enabling you to commence operations. It involves submitting the accumulated documents, including the rent contract and evidence of capital, to the registry and fulfilling any final compliance checks.

Opening a Corporate Bank Account

Opening a corporate bank account marks the culmination of the registration process and the beginning of your company's operational phase. This account is essential for managing finances, receiving payments, and fulfilling tax obligations. The requirement for a tax identification number and the necessity of having a legal and physical presence underscore the interconnected nature of these steps.

Conclusion

Establishing a company in Turkey offers numerous advantages for entrepreneurs seeking growth and expansion opportunities. With its stable economy, strategic location, and favorable business environment, Turkey provides a conducive setting for business success. By understanding the legal requirements, tax implications, and procedural steps involved in company formation, investors can navigate the process effectively and establish a strong presence in this dynamic market.

Procedures and Timeline of the Turkish Register Company in Turkey Program

After all application documents, including relevant certifications and translations, are prepared, the investment can be finalized, and the documents can be submitted to the government. Typically, applications are approved within a timeframe of three to five days, after which company registration documents are issued.

Notice: Prior to commencing your Turkey register company in Turkey, it is strongly advised to consult with a qualified legal professional. Our law firm, MFY Legal, would be delighted to assist you in registering a company in Turkey.

FAQs

Is it obligatory to have a local collaborator to establish a company in Turkey?

No, foreign investors can establish wholly-owned enterprises in Turkey without necessitating a local collaborator.

What is the minimum capital prerequisite for company establishment in Turkey?

These standards are continually evolving, and there exists a distinct mandatory capital sum for every category of company. The current capital prerequisites for 2024 are outlined as follows:

Per Presidential Decree No. 7887 disseminated in the Official Gazette on November 25, 2023, the minimum capital stipulation for joint-stock and limited companies has been elevated. For joint-stock companies, the minimum capital requirement stands at 250,000 TL (formerly 50,000 TL). Private joint-stock companies embracing the registered capital system must possess a minimum initial capital of 500,000 TL (formerly 100,000 TL). Limited companies are now mandated to have a minimum capital of 50,000 TL (formerly 10,000 TL). Additionally, with the "Correction" issued in the Official Gazette on November 26, 2023, the effective commencement date of the new regulation has been amended to January 1, 2024.

What is the duration for registering a company in Turkey?

Typically, the registration procedure consumes several weeks to finalize, encompassing the compilation of documents, their submission to authorities, and ultimate endorsement.

Are there any enticements or tax concessions available for nascent enterprises in Turkey?

Indeed, the Turkish government extends an array of incentives and tax concessions to stimulate investment and entrepreneurial initiatives, including tax benefits for strategic investments and endeavors in research and development.

Can foreign-owned enterprises repatriate profits from Turkey?

Certainly, foreign-owned enterprises can remit profits and dividends from Turkey, contingent upon specific tax regulations and reporting obligations.