Turkey Company Formation
Turkey offers many advantages as a commercial hub and is the ideal place to establish a business. Investors looking to pioneer new opportunities in Europe, The Middle East, Africa and Asia should consider Turkey as a base of operations due to its strategic location, further complemented by its fast-developing and dynamic economy.
The Joint Stock Company: This option is more suitable for larger businesses with a higher minimum share capital than the limited company. It is usually preferred by investors interested in setting up large operations in Turkey.
The Limited Liability Company: This corporate vehicle can be public or private however the private limited liability company tends to be favoured by foreign investors and enterprises. A minimum share capital of 10,000 Turkish Lira is required to form this type of company and there must be at least one shareholder. The liability for this company is limited to the amount of share capital.
The Commandite Company: A non-corporate business form which is equivalent to the limited partnership in the UK. The participants are called partners which can be active or dormant and any active participants are also known as general partners who will have unlimited liability for the company’s debts and obligations.
The Collective Company: The liability of the shareholders is limited to the capital which is subscribed and paid up by the shareholder. It is mandatory in this form of business that all shareholders are natural persons as opposed to corporate entities. The articles of association set out the rights and obligations of the shareholders.
Steps to Registration:
- You will need a tax number before you are able to incorporate a business in Turkey. One option for foreign investors and entrepreneurs is to buy a property in Turkey through the Citizenship by Investment scheme and they would therefore be issued a tax number.
- Location is key for any newly established business therefore an investor should consider whether physical offices are needed or whether virtual offices are sufficient.
- Select the most appropriate form of business for your personal circumstances.
- Initiate the process of setting up the company’s accounts and consider the tax advantages where possible.
- Registration of the company: often powers of attorney are given on behalf of you at an initial stage and then subsequently on behalf of the company to enable an agent, lawyer or accountant to act on your behalf.
- Open a bank account and commence trading.