Turkey is known and broadly recognized as a commercial center and appeals as a destination for new companies since it is located at the crossroads between Europe and Asia. For many years, Turkey has attracted foreign investors due to its unique trading location. Birgan & Partners Consultancy and Attorneyship is prepared to handle all types of company formation needs in Turkey. We assist international investors with the incorporation of companies in Turkey and ensure them that all formal processes and procedures regarding the establishment of the company in Turkey shall be managed by the experienced team members of Birgan & Partners.
For foreign investors considering setting up any business in Turkey, there are a number of options available. According to Article 9 of the Implementation Regulation for Foreign Direct Investment Law which has entered into force by being published in Official Gazette No:25205 and dated 08.20.2003, the companies which can be established or affiliated to by foreign investors are the companies stipulated in TCL (Commercial Code) and unincorporated companies stipulated in Obligations Law. Under applicable Turkish legislation, foreign investors are allowed to establish joint stock companies (hereinafter reffered to JSCs) or limited liability companies (hereinafter refereed to LLCs) as shareholders of such companies. Collective companies, commandite companies, liaison offices are the other options foreign investors may take into account while setting up a business in Turkey.
- Turkish Joint Stock Company Formation (JSC)
Joint Stock Companies are legal entities that are one of the most commonly preferred corporation types since this type is more flexible compared to other types of corporations available in Turkish legal system. A JSC may be incorporated for any economic purposes, provided that such law is not prohibited by law. JSCs may be established for an indefinite period by at least one person or legal entity shareholder. There is no nationality or residency restriction for shareholders. The minimum capital required for the establishment of JSC is TRY 50.000; may be increased up to TRY 100.000 through Board of Directors’ resolutions within a designated registered share capital limit. At least 25 % of capital contributions must be paid during the establishment of the company; unpaid capitals must be paid in two years following the establishment of the company. The shareholders’ liability of a JSC is limited to shareholders’ subscriptions to share capital; may not be held personally liable. Companies are managed by the Board of Directors; one or several board members may be appointed. At least one of the board members is required to be Turkish citizen and the resident of Turkey. In order to transfer the shares in JSCs, a contract without the approval of notarization is deemed sufficient unless otherwise stipulated in the Articles of Association. Half of the representatives of the original capital must be ready to reach the mandatory quorum in order to amend on the Articles of Association. JSCs can be listed with stock exchanges.
- Turkish Limited Liability Company Formation (LLC)
According to Turkish Commercial Code, a limited liability company requires at least one person. A Turkish LLC needs to have initial capitalization of TRY 10.000. A LLC may be incorporated for any economic purposes within the Law. A shareholder of an LLC has a partnership share calculated in accordance with the nominal value of capital subscribed to. However, there is an exception that shareholders of LLC are held liable for public debts in cases where the unpaid taxes or the similar public charges cannot be collected from the company or its representatives respectively. While there is not any maximum or minimum shareholders number required for JSC, LLC may have maximum 50 shareholders. The board of LLC is constituted of managers and managed by managers who are chosen from among non-share holders or real persons or legal entity shareholders. It should be noted that at least one shareholder must be appointed as manager. Two thirds majority of the representatives of the original capital must be ready to reach the mandatory quorum in order to amend on the Articles of Association. In order to transfer the shares in LLC there must be approval of the General Assembly and formal written and notarized contract executed between the transferor and the transferee.
Our Services Relating to Company Incorporation and Operations
Local and foreign investors seeking to engage in activities in Turkey can avail of Birgan & Partners’ consultancy services concerning the establishment of a new company.
Birgan & Partners Consultancy and Attorneyship can assist your company on the following matters;
- Advising on drawing up your business plan and the establishment of your invested company which includes the required documents, expenses etc.
- Drafting and revising documents and giving advice accordingly.
- Informing about essential documents listed under the Regulation on the Trade Registry and making an application to Trade Registry
- Advising on corporate reorganization, including mergers, acquisitions and joint ventures
- Counselling on tax issues, including VAT, corporate taxation and amnesty from tax
- Dealing with state regulatory authorities in obtaining various permits, licences and authorizations, including M&A clearances from the Turkish Competition Authority
- Advising on General Assembly meetings as per Turkish commercial law
- Giving legal advice regarding the procedure of liquidation and dissolution of companies in Turkey
- Providing legal assistance for mergers and acquisitions in Turkey
- Representing clients in front of Turkish courts, in all the stages of litigation
- Helping clients with obtaining special permits and licences from Turkish authorities
Please do not hesitate to contact us for more information.