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Introduction: Is company establishment in Turkey a solution?
It is necessary to make a reference to several advantages of setting up a business in Turkey:
With regard to the advantages of doing business in Turkey also take a look at our articles :
What is the meaning of company establishment in Turkey
Company establishment in Turkey can be a strategic move for many businesses due to its dynamic economy and strategic location. This guide will walk you through the key steps and considerations for successful company establishment in Turkey.
Turkish Commercial Code (Numbered 6102) is the most central legislation enforceable to founding a company in Turkey. In the light of the company type, Turkish Code of Obligations (Numbered 6098) and Turkish Civil Code (Numbered 4721) are also applicable to the Turkish company law under Article 126 of Turkish Commercial Code.
Under Article 125 of Turkish Commercial Code, commercial companies have legal personality. To clarify, A company shall acquire a legal personality upon registration with the Trade Registry according to the Turkish Commercial Code. Therefore a company is accepted to be a separate legal person. That necessarily follows that all commercial companies may benefit from all rights and undertake debts within the framework of Article 48 of the Turkish Civil Code. Besides, those who conduct transactions and enter into commitments on behalf of the company before registration may be personally and successively held responsible for these transactions and commitments.
Can Foreigners Open a Company in Turkey? “Company establishment in Turkey is possible for foreigners. To register a company in Turkey for foreigners, the law numbered 4875 came into effect in 2013, granting foreign investors the same rights as Turkish citizens.
Owing to enactment of Foreign Direct Investment Law (Numbered 4875), the difference between foreign or national investors were eradicated under Turkish legal system in 2013. Presently, it is important to underline that foreign investors shall be subject to equal treatment with domestic investors. Besides, the principles and standards enumerated in Turkish Commercial Code facilitate foreign-led companies in Turkey.
What is more, there are many improvements dedicated to setting up a better investment hub in Turkey. Indeed, the 2024 FATF Decision on Türkiye accelerates all investment projects into Turkey. Potential results of the decision in question should be taken into evaluated carefully by all legal practitioners including business lawyers.
As a part of FATF obligations of Turkey, the Law Numbered 7518 on Amendments to the Capital Markets Law Numbered 6362 has been enacted in 2024. The Law Numbered 7518, mainly known as Turkish Crypto Law of enters into force following the circuit of the Official Gazette dated July 2, 2024. The first decision on the 2024 Announcement for the Rejected Crypto Asset Platforms was delivered by the Board dated 23 August 2024. 2024 Legal Status of NFTs and P2P in Turkey was also clarified by the recent Resolution by Turkish Capital Markets on Turkish Crypto Assets Service Providers.
Besides the digital participation banking system is accepted by Turkish lawmakers in Turkey. Besides, the recognition of digital wallets has also been completed by means of new regulation of the Central Bank of the Republic of Türkiye. In this way, a Digital Wallet Era in Turkey started. Thirdly, the 2024 New Electronic Submission System for Turkish Capital Markets was instituted by the Capital Markets Board of Türkiye.
Forms of company establishment in Turkey
Which type of company to incorporate in Turkey? You can establish five types of companies in Turkey. According to Article 42 and 43 of the Turkish Commercial Code collective company, commandite company, cooperative company, limited company, join stock company five main company types can be formed.
How can I register a company in Turkey? Above all, it is critical to take into account that the incorporation procedures can be carried out electronically through the Central Registry System (MERSİS). Markedly, the absence of any hassle in the formation process is of great significance in attracting foreign investments to Turkey. What is very attractive is that the establishment of a single-shareholder joint stock company or single-member limited liability company is allowed under Turkish Commercial Law. Let us remind you that our office’s expert lawyers will be more than happy to assist you in the establishment of a company in Turkey.
How to establish a company in Turkey? To summarize, investors should take a number of actions in the establishment of a company in Turkey. Duly preparation, performance and submission of paperwork concerned is critical for the below-mentioned requirements. Common requirements reads as follows for company establishment in Turkey:
In general, companies are subject to a standard corporate income tax rate of 20% except for finance-centric companies including banks paying 25%. 2024 Changes to Turkish Tax Procedural Law must also be critically analyzed for all businessmen and individuals.
You can also read the following articles as they are related to the topic.
It is of course possible to make an investment through the acquisition of shares rather than establishing a company directly. That is the case for both alien or local investors.
A company may terminate in case the realization of any of the reasons for termination stipulated at the law, and in line with the decision of the shareholders. There are two main types of liquidation: “compulsory” and “voluntary”. It requires a termination process of a legal entity. The Enforcement and Bankruptcy Code (Numbered 2004) is at the heart of this process. The main objective of the liquidation process is to sell the assets of the company and convert the assets of the involved company into money, collect their receivables, and pay debts. Article 536 of Turkish Commercial Code stipulates that the liquidation start-up, the appointment and announcement of Liquidor must be registered.
The first step in the process of company establishment in Turkey is company registration. The registration process includes:
Company formation in Turkey involves more than just registration. It includes setting up the operational aspects of the business. Key short-term steps include:
Company incorporation in Turkey is the legal process that formalizes the establishment of your company. It involves:
Review our article on Contract Law in Turkey
Engaging a Turkish business lawyer specialized in company establishment in Turkey can significantly streamline the process. A lawyer can assist with:
Opening a company in Turkey involves practical considerations beyond legal formalities. Important factors include:
At this juncture, it is critical to underscore that foreign entrepreneurs should also keep in mind other opportunities to enter into Turkey. Formation of Liaison Offices in Turkey is another option for Turkey investment field. Franchising in Turkey is another type of method to enter into Turkey by foreign entrepreneurs. It is interesting and problematic that currently there is no specific Turkish legislation stipulating the scope of franchise agreements. What is more, the Block Exemption Communiqée on Franchise Agreements No:1998/7 was abolished with the entry into force the Block Exemption Communiqué on Vertical Agreements (No:2002/2). Hence, the franchise agreement is deemed as a “sui generis” type of contract.
Company establishment in Turkey offers numerous opportunities for businesses looking to expand into a vibrant and growing market. By understanding the key steps of company registration, formation, incorporation, and leveraging the expertise of a specialized lawyer, you can navigate the process smoothly and set up a successful business in Turkey. Whether you’re looking to start a small enterprise or a large corporation, Turkey provides a conducive environment for growth and success.
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