How to Set Up a Foreign-owned Company in Turkey, Step by Step

If you are planning to set up a foreign-owned company in Turkey, the process is more structured and more accessible than many investors expect. Turkey’s foreign direct investment regime, anchored in the Turkish Commercial Code, Law No. 6102, and the Foreign Direct Investment Law, Law No. 4875, is based on the principle of equal treatment between foreign and domestic investors, subject to applicable sector-specific legislation, licensing requirements and regulatory approvals.

At BOZKURT, we guide inbound investors through every stage of this process. In practice, a successful incorporation usually depends less on the complexity of Turkish company law itself and more on careful preparation before the first filing is made. The main stages are choosing the correct legal entity, preparing the Articles of Association and supporting documents, completing MERSIS and Trade Registry filings, arranging capital payment where required, and completing tax, banking, accounting and social security registrations after incorporation.

This guide walks through each stage in order, with the practical points, documents and risks foreign investors most often encounter when establishing a Turkish company.

Which Entity Should a Foreign Investor Choose?

The first decision in any company formation process in Turkey is the legal vehicle. The Turkish Commercial Code recognises several commercial entity types, but foreign investors most commonly choose between two capital companies: the Limited Liability Company, known in Turkish as a Limited Şirket or Ltd. Şti., and the Joint Stock Company, known as an Anonim Şirket or A.Ş.

Branch offices and liaison offices may also be used in specific cases, but they serve narrower purposes and do not create the same type of independent Turkish corporate structure as an LLC or JSC.

Key Commercial and Legal Differences

A Limited Liability Company is commonly used for small and medium-sized foreign investments. Under the Turkish Commercial Code, an LLC may be established by one or more shareholders, whether natural persons or legal entities. The current minimum capital requirement for an LLC is TRY 50,000. Governance is generally simpler than in a joint stock company, but share transfers in an LLC are subject to formal requirements, which commonly include notarised transfer documentation, shareholder approval and Trade Registry procedures.

A Joint Stock Company is generally preferred for larger, investment-oriented or regulated structures. A standard JSC may also be established by one or more shareholders. The current minimum capital requirement for a standard JSC is TRY 250,000. Non-public joint stock companies that are permitted to adopt the registered capital system are subject to a higher initial capital threshold, which should be verified against the current regulatory framework before incorporation. JSCs offer easier share transferability, a more flexible investment structure and a clearer route for future capital raises. They are also mandatory or more suitable for certain regulated activities, including banking, insurance, financial services and capital markets-related activities.

A branch office is not a separate legal entity from the foreign parent company. It is an extension of the foreign company in Turkey and may conduct commercial activity within the scope of its registration. However, the foreign parent company remains directly liable for the branch’s obligations.

A liaison office, also known as a representative office, is different. It requires permission from the relevant authority and is limited to non-commercial activities such as representation, coordination, market research and communication. A liaison office is limited to non-commercial activities and is not permitted to engage in profit-generating commercial activity in Turkey.

The figures above reflect the legal thresholds and practical structures applicable as of the date of publication and should be re-checked before filing, as capital thresholds and procedural requirements may change.

Under Provisional Article 15 of the Turkish Commercial Code, companies whose share capital remains below the statutory minimum must increase their capital by 31 December 2026. Failing to do so may result in the company being deemed dissolved. For non-public joint stock companies subject to the registered capital system, the same deadline applies to the required capital thresholds. This transitional rule should therefore be treated as a time-sensitive compliance priority for existing companies in Turkey.

Pre-Incorporation Checklist: What to Prepare Before You File

Before any filing is submitted, a foreign investor should assemble a complete document set and carry out preliminary checks. Incomplete corporate documents, inconsistent shareholder information, missing apostilles and inaccurate translations are among the most common reasons for delay.

Documents Required

Foreign individual shareholders and directors are generally required to provide passport copies translated into Turkish and notarised, depending on the country of issuance and the relevant registry practice. Where documents are issued, certified or notarised abroad, apostille or Turkish consular certification may be required, followed by sworn Turkish translation and local notarisation in Turkey.

If the shareholder is a foreign corporate entity, the required documents usually include an apostilled or consular-certified certificate of incorporation or activity certificate, constitutional documents, an authorised board or shareholder resolution approving the Turkish investment, and documents proving the authority of the signatories. These documents must usually be translated into Turkish by a sworn translator and notarised in Turkey.

The investor should also determine the proposed trade name before drafting the Articles of Association. The name must comply with Turkish naming rules and be available through the central registration system. Where the company name contains sectoral or regulated terms, additional care may be needed.

A registered office address in Turkey is also required. This is usually documented through a lease agreement or title-related documentation, depending on whether the premises are rented or owned.

If the investor or authorised signatories will not be physically present in Turkey, a power of attorney should be prepared. For foreign investors, the power of attorney must be carefully drafted so that it covers the incorporation process, MERSIS filings, Trade Registry applications, notary procedures, tax registration, bank account opening and related post-incorporation steps.

Banks may also request additional documents for corporate account opening, including beneficial ownership declarations, source-of-funds information, tax identification documents, corporate group charts and compliance questionnaires. These bank compliance checks often run in parallel with the incorporation process but may take longer than the Trade Registry stage.

Pre-Approval for Restricted Sectors

Most sectors in Turkey are open to foreign investment. However, certain sectors may be subject to licensing, foreign ownership restrictions, local presence requirements or regulatory approvals. These include, depending on the activity, banking, insurance, payment services, capital markets, broadcasting, civil aviation, maritime activities, mining, education, healthcare and private security.

Investors should confirm sector-specific requirements before finalising the entity type, activity scope and Articles of Association. This is particularly important where the intended business will require an operating licence after incorporation.

Step-by-Step: How to Register a Company in Turkey as a Foreign Investor

The incorporation process for a foreign-owned company in Turkey follows a defined sequence through MERSIS, the Trade Registry, the notary, the tax administration, the bank and, where employees are involved, the Social Security Institution. Below is the practical walkthrough we follow with clients at BOZKURT.

Step 1: Choose the Entity Type and Confirm the Activity Scope

Before preparing the Articles of Association, the investor should decide whether the company will be established as an LLC, JSC, branch or liaison office. This decision should be based on the business model, capital needs, number of shareholders, future investment plans, transferability requirements, regulatory obligations and expected governance structure.

The activity scope should be drafted carefully. A scope that is too narrow may create operational restrictions later, while a scope that is too broad or uses regulated wording may trigger Trade Registry questions or licensing issues.

Step 2: Prepare the Articles of Association

The Articles of Association are the constitutional document of the company. For an LLC or JSC, they normally include the company name, registered office address, field of activity, share capital, shareholder structure, management and representation rules, share transfer mechanics and other mandatory provisions.

The Articles of Association are prepared through MERSIS in Turkish. A foreign-language translation may be prepared for the investor’s understanding, but the Turkish version is the legally operative text for registration purposes.

Errors in the Articles of Association, particularly in the activity clause, capital structure, shareholder information or representation authority, can lead to delays or rejection. Local legal review before final submission is strongly recommended.

Step 3: Complete MERSIS Registration and Trade Registry Filing

MERSIS, the Central Registry Record System, is the electronic registration system used for company incorporation and commercial registry procedures in Turkey. The incorporation application is prepared through MERSIS and then submitted to the relevant Trade Registry Office where the company’s registered office is located.

The Trade Registry filing typically includes the MERSIS application, Articles of Association, shareholder and director documents, signature declarations, registered office documentation, capital payment evidence where required, and other supporting documents depending on the company type and shareholder structure.

In straightforward cases, company registration may be completed relatively quickly once all documents are ready. In practice, timing depends on the relevant Trade Registry, document quality, shareholder structure, foreign documentation, notary availability and whether the activity requires additional review.

Step 4: Arrange Capital Payment Where Required

Capital payment rules differ between LLCs and JSCs.

For a Joint Stock Company, at least 25% of the cash capital subscribed must be paid into a bank account opened in the company’s name before registration. The bank issues a letter confirming the blocked capital amount. The remaining capital must be paid within the statutory period, generally within 24 months following registration. For a standard JSC established with the current minimum capital of TRY 250,000, the initial pre-registration payment is therefore at least TRY 62,500.

For a Limited Liability Company, the 25% pre-registration capital payment rule applicable to JSCs does not apply in the same way. Subscribed capital for an LLC may generally be paid within 24 months following establishment, unless a shorter payment period is set in the Articles of Association or required in a specific case. In practice, the capital payment structure should be coordinated with the accountant, bank and Trade Registry before filing.

The capital payment mechanics should be verified against current Turkish commercial law and trade registry practice before filing.

Step 5: Trade Registry Registration and Gazette Publication

Once the Trade Registry approves the application, the company is registered and acquires legal personality. The company receives a trade registry number, and its incorporation is published in the Turkish Trade Registry Gazette.

From this point, the company may open bank accounts, issue invoices once tax activation is complete, hire employees after completing social security registration, and commence business operations subject to any applicable sector-specific licences or permits.

Step 6: Tax Registration and Accounting Setup

Following Trade Registry registration, the company’s tax identity number is generated, and tax registration procedures are coordinated with the relevant tax office. The company must also appoint an accountant or certified public accountant to maintain its statutory books, prepare tax declarations and manage ongoing compliance.

A company whose legal or business centre is in Turkey is generally treated as a Turkish tax-resident entity and is subject to Turkish corporate income tax on its worldwide income, subject to applicable exemptions, deductions and treaty considerations. As of 2026, the general corporate income tax rate is 25%. However, certain financial institutions specifically listed in Article 32 of the Corporate Income Tax Law are subject to a higher rate of 30%. Companies should also consider Turkey’s 10% domestic minimum corporate tax regime. However, companies starting operations for the first time are generally excluded from the domestic minimum corporate tax calculation for their first three accounting periods from the commencement of activity, subject to the applicable rules and exceptions.

Still, Turkish corporate tax rates and minimum tax rules have been subject to periodic legislative changes. Investors should verify the applicable corporate income tax rate and any minimum tax rules at the time of incorporation and throughout the relevant fiscal year, particularly for financial-sector entities.

The company may also have VAT, withholding tax, stamp tax and other periodic tax obligations depending on its business activity, contracts, employees and transactions.

Step 7: Social Security (SGK) Registration

If the company will employ staff, it must register as an employer with the Social Security Institution, known as SGK, before the first employee starts work. The company will then be responsible for monthly social security declarations and contributions.

If directors, managers or foreign personnel will carry out their duties physically in Turkey, work permit and residence permit issues should also be assessed. Foreign nationals may serve as shareholders, directors or board members; however, the right to physically work or manage operations in Turkey must be assessed separately under immigration and work-permit rules.

Post-Incorporation Compliance and Practical Next Steps

Registering the company is only the beginning. Foreign-owned companies should build ongoing legal, tax and accounting compliance into their operational planning from day one.

Opening a Corporate Bank Account

After incorporation, the company can open a commercial bank account using its Trade Registry certificate, tax identification details, signature circular or signature declarations, Articles of Association and other corporate documents.

Turkish banks typically request beneficial ownership information, passport copies of shareholders and directors, corporate group charts where applicable, source-of-funds information, proof of address and internal compliance forms. For foreign-owned companies, bank onboarding may take longer than the Trade Registry process itself.

Invoicing and E-Invoice Requirements

Turkey operates an extensive electronic document system, including e-Fatura, e-Arşiv Fatura and e-Defter. Mandatory transition depends on annual gross sales revenue, sector, taxpayer status and specific Revenue Administration rules.

Foreign-owned companies should confirm their e-document obligations with their accountant immediately after tax registration. Even where mandatory thresholds are not yet met, voluntary adoption may be commercially useful, especially for companies working with larger Turkish counterparties.

Tax Obligations, Does a Foreign Investor Pay Tax in Turkey?

Yes. A company incorporated and headquartered in Turkey is generally treated as a Turkish tax-resident company and is taxed in Turkey on its worldwide corporate income. The nationality of the shareholders does not, by itself, remove the company from the Turkish corporate tax system.

Ongoing obligations may include corporate income tax returns, provisional tax returns, VAT returns, withholding tax declarations, stamp tax on certain agreements and payroll-related filings. The exact compliance calendar depends on the company’s activity, employee structure, invoice volume and contract profile.

Foreign individual shareholders may also have Turkish personal tax considerations if they reside in Turkey, receive dividends, provide services to the company or become tax resident under Turkish law. Double tax treaties should be reviewed where cross-border dividends, management fees, royalties, interest or service payments are expected.

Annual Corporate Governance and Statutory Books

Turkish companies must maintain statutory books and accounting records in accordance with Turkish law. Ordinary general assembly meetings should be held within the statutory period following the end of the fiscal year to approve annual matters such as financial statements, management release, profit distribution where applicable and appointments.

JSCs generally have more formal governance requirements than LLCs, including board resolutions, general assembly procedures and share ledger maintenance. LLCs are administratively simpler, but still require proper corporate records, shareholder resolutions and Trade Registry filings for certain matters.

Directors, Representation and Permits

Turkish law does not generally require the director of an LLC or board member of a JSC to be a Turkish national or Turkish resident. Foreign nationals may serve as directors, managers, or board members. Crucially, however, under Article 623 of the Turkish Commercial Code, an LLC must ensure that at least one partner has management and representation authority. By contrast, a JSC may have a board composed entirely of non-shareholders, subject to the applicable legal requirements for board membership and representation.

However, practical requirements still matter. Persons authorised to represent the company may need a Turkish tax identification number, notarised signature documentation and, where they will physically work in Turkey, appropriate immigration and work authorisation.

Investors should avoid using nominee directors purely for convenience. Directors, managers and authorised representatives may carry personal exposure in relation to tax, social security, public debts and certain regulatory obligations. The safer approach is to appoint individuals who genuinely participate in governance and to ensure that representation authority is clearly structured.

Work and Residence Permits for Foreign Directors and Employees

A foreign shareholder or director does not automatically obtain the right to live and work in Turkey merely because a Turkish company has been incorporated. If a foreign national will physically reside and work in Turkey, work permit and residence permit requirements should be assessed separately.

In many structures, a foreign shareholder may remain abroad while appointing a local manager, accountant and legal representative to handle operational matters. Where the foreign investor intends to manage the business from Turkey, the immigration position should be planned before operations begin.

Sectoral Rules and Restricted Activities

Turkey’s foreign investment regime is relatively liberal, and many sectors are open to 100% foreign ownership. However, specific legislation may impose licensing, approval, capital, local presence or shareholding rules in regulated sectors.

Investors in banking, insurance, payment services, fintech, capital markets, broadcasting, aviation, maritime transport, private security, education, healthcare, energy and mining should obtain sector-specific advice before incorporation. In some cases, the correct legal structure depends not only on company law, but also on the regulator’s licensing expectations.

Turkey also offers investment incentives administered through the relevant public authorities. Depending on the sector, region, investment size and project type, incentives may include VAT exemptions, customs duty exemptions, tax reductions, employer social security contribution support, interest support or land allocation. Eligibility should be analysed at the planning stage rather than after incorporation.

Costs and Estimated Fees for Company Formation in Turkey

The total cost of registering a company in Turkey varies depending on the entity type, city, number and nationality of shareholders, document volume, translation requirements, banking process, and whether the activity is regulated.

The following table provides a practical cost framework rather than a fixed tariff. Official fees, notary fees and exchange rates change periodically and should be confirmed immediately before filing.

The above figures are indicative only and should be rechecked immediately before filing, as official fees, exchange rates and registry practices may change.

For foreign corporate shareholders, the cost is usually higher than for individual shareholders because corporate documents, board resolutions, apostilles, translations and bank compliance review are more extensive.

Common Mistakes and Practical Risks

In practice, most incorporation delays arise from preventable issues.

One common mistake is using outdated minimum capital figures. Since the capital thresholds for LLCs and JSCs have increased, investors should verify current minimum capital before preparing the Articles of Association.

Another frequent problem is incomplete or incorrectly legalised foreign documentation. Apostilles, notarisation, Turkish consular certification and sworn translations must be handled carefully. A document that is valid in the country of origin may still be unusable for Turkish Trade Registry purposes if the certification chain is incomplete.

Errors in the Articles of Association are also common. A narrow activity clause may limit future operations, while a poorly drafted representation clause may create signing authority problems with banks, customers or public authorities.

Bank account opening can also delay operations. Trade Registry incorporation may be completed before the bank finishes its compliance review. Foreign investors should therefore prepare beneficial ownership and source-of-funds documents early.

Late tax, e-document or SGK setup can create penalties and operational difficulties. Companies planning to invoice customers or hire employees immediately after incorporation should coordinate with their accountant before registration is completed.

Finally, investors should be cautious with nominee directors and artificial governance structures. The person shown as authorised representative may carry real responsibility under Turkish law. Governance should reflect the actual decision-making structure of the business.

Conclusion, Setting Up a Foreign-Owned Company in Turkey

Turkey’s incorporation framework is designed to accommodate foreign investment efficiently, and with proper preparation a foreign-owned Turkish company can often be established within a matter of weeks. The legal steps are relatively clear: entity selection, Articles of Association, MERSIS preparation, Trade Registry filing, capital arrangements, tax registration, accounting setup and post-incorporation compliance.

In practice, delays usually arise not from the law itself, but from preventable issues: outdated capital assumptions, incomplete apostilles, inconsistent shareholder documents, narrow activity clauses, bank compliance questions or late tax and SGK registrations.

For foreign investors entering the Turkish market, the safest approach is to prepare a jurisdiction-specific incorporation checklist before filing anything with MERSIS or the Trade Registry. Early coordination between legal counsel, accountant, notary, bank and the Trade Registry significantly reduces the risk of re-submission, penalties and operational delay.

BOZKURT advises foreign investors, international companies and foreign law firms on Turkish company formation, corporate structuring, commercial contracts, regulatory compliance and cross-border market entry. Investors considering entry into the Turkish market should obtain tailored advice before choosing the entity type, drafting the Articles of Association or committing to a regulated activity.

1. Invest in Türkiye, Establishing a Business
2. Turkish Commercial Code (Law No. 6102), Mevzuat
3. Trade Registry Gazette / Central Trade Registry Portal
4. MERSIS, Central Registration System (Ministry of Trade)
5. Revenue Administration (GİB), Turkish Tax Office
6. Türkiye Barolar Birliği (Turkish Bar Association)