Turkey Investment

SETTING UP BUSINESS IN TURKEY

Turkey is attracting for years foreign direct investment thanks to her unique trading location between Asia, Europe and the Middle East. Many international companies are opening offices in and around Turkeys’ major cities. The base of the majority of these larger companies is in Ankara and İstanbul.

* Why set up a business in Turkey?

Government incentives for investors and new businesses include: 

. The right for foreign companies to hold "Turkish Company" status, giving new business owners the same rights and obligations as existing Turkish companies;

. Guarantee of existing investment rights;

. Conformity with international standards;

. Imports of certain machinery and equipment are now exempt from customs duties, levies and VAT; 

. Certain exemptions from income tax and social insurance contributions;

. Energy subsidies;

. Incentives available in Turkey's free trade zones, including exemptions from a number of taxes and customs duties;

. Better protections for foreign investors.

* How do you set up a business in Turkey?

There are a number of options available to set up a business in Turkey.

. First, you will need to seek some solid legal advice and do your research with the relevant authorities.

. Foreign investors may consider to set up such companies as collective companies, joint stock companies, commandite companies (business set up to run under a trade name), liaison offices and the set up of a branch of an existing foreign company.

* Can foreigners open a private limited company in Turkey?

Yes. A private limited company is the most popular form of business for foreigners and can be set up by two or more non-Turkish nationals. At least one shareholder is required to form this type of company, with a minimum share capital of 10,000TL.

* Where can I seek advice on setting up a business in Turkey?

It is important to work with a good legal advisor that knows company laws in Turkey.

* What kind of business can a foreigner set up in Turkey?

The banks, factoring, private finance institutions, foreign currency exchange offices, companies cannot be opened prior approval from the Ministry of Commerce and Industry. These are subject to Capital Markets Law, public warehousing and operators of free-trade zones.

* What is Turkish limited liability company cost?

Legal conditions and costs of business set-ups in Turkey changes from the most other countries. A private limited company can be opened with a total of 10,000TL, which needs to be deposited during the first phase of the incorporation. The liabilities of the shareholders are limited to the share capital invested in the firm.

* What is the set-up process?

. The process of the company incorporation in Turkey is relatively straightforward and the investor can begin trading within a week, as long as they have everything in order. 

. The first task is drafting the articles of association, which need to be signed by the company directors. The articles of association must be conform to article 279 of the Turkish Commercial Code. It is important that the document needs incorporate the phrase “limited” in the companies trading name. The nationality of founders needs to stated, besides, full names, surnames, addresses, and trading address. The document is then taken to be officially notarised and translated if necessary.

. The minimum share capital has to be deposited in a bank account in the company name.

. Having done this, investors can start the registration process, paying a fee to the Turkish Commercial Registry Office, with the necessary documents.

. The Registry Office will issue a registration certificate and the company's incorporation is published in the Turkish Gazette.

. The company must then register for VAT with the relevant tax authority.

* Turkish laws regarding trading names

. Your trading name must be original and not registered by anyone previously.

. It must not mislead third parties and the words “Turkiye; Turk; Cumhuriyet; Milli” cannot be used without the specific approval of the Turkish Council of Ministers.

.  In case of not contradicting any government or cultural laws or policies, foreign words and titles can be used in the trading name

* How to register your Turkish company with the Trade Registry Office

. Throughout turkey, the Turkish Chamber of Commerce has offices in all major cities and most towns.

To organise the official trade registry:

- fill out the Articles of Association and

- had them officially notarised,

- contact Turkish Chamber of Commerce within 15 days 

. On registry; you need

- company registration application form,

- written request for application, 

- suitable identification proving you are the founding members,

- a letter of commitment in line with Article 29 of the Trade Registry Regulations,

- a receipt of payment of the deposit necessary to the Customers Fund Account (normally 1/1000 of the company’s capital).

* Taxes

A private limited company set up and resident in Turkey has to pay full tax on profits earned and declared.