STEPS FOR COMPANY REGISTRATION IN TURKEY
At the crossroads between Europe and Asia, offering a welcoming environment for all foreign investors, Turkey is known and broadly recognized as a major commercial hub.
Although with the new Commercial Code in force, company formation process has been simplified and can now be conducted quite hassle-freely, clients should still fulfill the following prerequisites in order to successfully registering their Turkish business:
1) Once the decision to incorporate a company in Turkey has been taken, clients should provide the 3 company names at their choice. The name must indicate the company’s scope of activities, e.g. foreign trade, and must equally contain the type of entity, e.g. limited company. In addition to the thorough consideration clients must give to their business name, they should also provide details pertaining to the shareholding & directorship structure, and to the actual activities the company shall conduct. Depending on the shareholding structure, i.e. whether the company will be incorporated by natural persons or legal entities, the documents necessary in the first stages of the incorporation will include, but not limited to: passport copies of the directors and shareholders, information regarding their residential address, trade register certificate showing that the founding company is duly registered in the country of origin, articles of association of the founding company, certificate of incorporation etc. It is equally important mentioning the fact that part of the above documents will need to be apostilled in the country of origin and that all the above documentation and information must be translated into Turkish by a sworn translator and thereafter notarized via Power of Attorney, should the clients decide not to be physically present for the registration procedures, in front of a Turkish Notary Public.
2) Phase II of the procedures references the actual registration of the company. At this point a number of papers in which the company director accepts the appointment and signs certain statements are provided to the client in order to be notarized and apostilled. Concurrently, the Articles of Association of the Turkish entity and the bank account set-up documents are prepared so that the share capital can be injected prior to the registration of the company (the share capital is available after the incorporation). These procedures can be conducted either through personal presence of the client in Turkey or via Power of Attorney, the decision being left at the client’s discretion.
3) The final step is to register the company with the Trade Register and to obtain the Tax ID number of the company. In order to obtain the company’s tax identification number a new series of documents must be prepared and submitted with the relevant authorities; among these we mention: Power of Attorney, specimen signatures, copy of the Turkish Official Gazette on the registration of the company, office rental and accounting agreements, etc.
Proper fulfillment of the above steps leads to the successful registration of the Turkish entity.
REQUIREMENTS FOR COMPANY FORMATION IN TURKEY
- Any person of any nationality or residence can be director or shareholder in a Turkish company;
- the shareholders of a company registered in Turkey can be both natural persons or legal entities;
- a company in Turkey must hold a local registered office (service provided by BridgeWest)
- the registration of a Limited Company requires the injection of a share capital of 10.000,00 TL out of which ¼ (2,500 TL) should be deposited in a bank account upon the registration of the company.
- According to the New Turkish Commercial Code a limited liability company requires at least 1 director and 1 shareholder
SERVICES PROVIDED FOR TURKISH COMPANY INCORPORATION
> Preparing the Articles of Association of your company;
> Drafting all other documents required for the registration of the Turkish Company;
> Arranging Public Notary meeting and procedures (The procedures for establishing a company in Turkey have to be performed by a Turkish Notary Public);
> Obtaining a Tax ID number;
> Providing a Registered Office in Turkey for your company (if required);
> Opening a Bank Account and providing the necessary forms and documents for the setup of a bank account;
> Accounting and Payroll Services in Turkey; accountancy services are recommended for any new business establishment in Turkey.
> Establishing a limited liability company
The limited liability company is the most used type of business in Turkey, mostly for small to medium sized businesses, because of a relatively easy registration process, low corporate taxes and a lot more advantages. A Limited Liability company is founded by at least 1 members, natural persons, or legal entities and they are held liable for the company's losses and debts only to the extent of their contribution. The minimum required capital to open this type of company in Turkey is 10,000 YTL, out of which 1/4 must be deposited upon the registration of the company. Limited companies cannot issue stock certificates.
> Setting up a joint stock company
It’s a company designed for business at a larger scale and it is not as common as limited liability companies. Nevertheless a lot of Limited Companies evolve into joint stock companies, or become shareholders of one. A Joint Stock company must be established by at least 5 persons or legal entities and the minimum required capital is 50,000 YTL (approx. 24,000 EUR). The shareholders liability is limited with the share capital. A Joint Stock company can issue stock certificates, unlike Limited companies.
> Turkish Branch, Subsidiary or Representative Office
Any foreign company is able to set up branch entities in Turkey. These can be set up as separate entities from the parent company (Turkish companies having the foreign company as shareholder) or extensions of the parent-company in Turkey.
TURKEY KEY FACTS:
> The Turkish standard .
> Under Turkish tax system all taxable companies are subject to to profits.
Please contact us for more information reagarding how to open a company in Turkey and prices!
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Call us now at +44 203 287 0408 to set up an appointment with our specialists in Istanbul. Alternatively you can incorporate your company without traveling to Turkey.
As a BridgeWest client, you will beneficiate from the joint expertize of local lawyers and international consultants. Together we will be able to offer you the specialized help you require for your business start-up in Turkey.