By Av. Serkan Kara, Istanbul Bar No. 53770. Last updated: 14 June 2026.
To start a business in Turkey, a foreign investor selects a company type under the Turkish Commercial Code No. 6102 (most often a limited liability company or a joint stock company), files the notarized articles of association through the MERSiS electronic trade registry system, obtains a tax identification number, and registers with the Social Security Institution (SGK). Under the Foreign Direct Investment Law No. 4875, foreign shareholders may own 100 percent of a Turkish company on equal footing with domestic investors, with no prior approval and no mandatory local partner for most sectors.
What law governs forming a company in Turkey?
Company formation in Turkey is governed primarily by the Turkish Commercial Code No. 6102, which sets out company types, capital rules, and registration. Foreign ownership is secured by the Foreign Direct Investment Law No. 4875, contractual relationships fall under the Code of Obligations No. 6098, and employment is regulated by the Turkish Labor Law. Together these instruments give domestic and foreign founders the same incorporation route, so a cross-border investor follows one framework rather than a separate foreign-investor regime.
Which company structure should a foreign investor choose?
The Turkish Commercial Code No. 6102 offers several vehicles, and the practical choice for most foreign investors is between a limited liability company and a joint stock company. A limited liability company suits closely held or owner-operated ventures, while a joint stock company suits larger structures, multiple investors, and a future exit or share transfer. Branches and liaison offices serve foreign companies that want a presence without a separate Turkish legal entity.
- Limited liability company (Ltd. Sti.): shareholder liability limited to subscribed capital, flexible management, popular for SMEs and holding structures.
- Joint stock company (A.S.): share-based ownership, easier transfer of shares, the standard vehicle for larger operations and investor entry.
- Branch and liaison office: options for a foreign company to operate or observe the market without incorporating a standalone Turkish entity.
LLC versus JSC: which fits cross-border plans
| Factor | Limited liability company (Ltd. Sti.) | Joint stock company (A.S.) |
|---|---|---|
| Typical use | SMEs, owner-managed, holding vehicles | Larger operations, multiple investors, exits |
| Ownership | Participation shares | Freely transferable shares |
| Share transfer | Notarized, registered with the trade registry | Generally simpler, supports investor entry |
| Capital threshold | Statutory minimum set by law; confirm the amount in force at filing | Higher statutory minimum; confirm the amount in force at filing |
| Public offering | Not available | Possible under capital markets rules |
For a deeper comparison see LLC vs JSC in Turkey for foreign investors.
How much capital is required to form a Turkish company?
Minimum share capital under the Turkish Commercial Code No. 6102 depends on the company type, with a higher floor for a joint stock company than for a limited liability company. These statutory minimums are set by law and have been revised in recent years, so a founder should confirm the exact figure in force at the time of filing rather than rely on a fixed historical amount. For a joint stock company, a portion of the cash capital (set by law) must be deposited before registration, with the balance paid in within the statutory period.
What documents are needed to register a company in Turkey?
Registration through the MERSiS trade registry requires a defined documentary file, and a clean file is what determines whether incorporation clears in days rather than weeks. The core documents are the articles of association and proof that capital and identity requirements are met. Translation, apostille, and consular legalization apply where shareholders or directors are foreign.
- Company title and notarized articles of association
- Identification and passport copies of shareholders and directors
- Proof of address for shareholders and directors
- Proof of the capital amount and its source
- Tax identification numbers for shareholders and directors
- Signature declarations and, for non-resident shareholders, a power of attorney for the local representative
What are the steps to set up a company in Turkey?
Incorporation follows a sequenced path under the Turkish Commercial Code No. 6102, moving from name reservation through trade registry filing to tax and social security registration. Working in order avoids re-filing, because each step depends on the documents produced by the one before it.
- Reserve the company name
- Draft and notarize the articles of association
- Submit the file to the Trade Registry Office through MERSiS
- Obtain the tax identification number and commercial registration certificate
- Register with the relevant Chamber of Commerce
- Open a corporate bank account and deposit capital where required
- Register with the Social Security Institution (SGK) and obtain any sector licenses
What licenses, tax, and labor obligations follow incorporation?
After registration, a Turkish company assumes ongoing obligations across tax, social security, and labor. Corporate tax, value added tax, and SGK premiums are governed by their own statutes and regulations, and the applicable rates and thresholds change, so they should be confirmed for the year of filing rather than assumed. Sector-specific licenses apply to regulated activities such as banking, energy, food, and healthcare, and these must be in place before the relevant operations begin.
- Tax: tax identification number, VAT registration, corporate tax filings, and periodic VAT declarations on the schedule set by law.
- Social security: SGK registration for the company and its employees before work starts.
- Labor: compliant employment contracts and workplace records under the Turkish Labor Law; work permits where foreign staff are employed.
- Sector licenses: activity-specific permits for regulated sectors before launch.
How does the cross-border angle affect a foreign investor?
The Foreign Direct Investment Law No. 4875 places foreign and domestic investors on the same footing, so the additional work in a cross-border matter is procedural rather than restrictive. The recurring friction points are document execution abroad, powers of attorney, apostille or consular legalization, and capital transfer documentation. Where foreign and Turkish law interact, the Private International Law and Procedure Law No. 5718 determines applicable law and the recognition of foreign documents and decisions, which matters for shareholder agreements and dispute clauses drafted at formation.
What goes wrong, and how is the risk controlled?
Most formation problems trace to defective articles of association, a capital deposit that does not match the filing, missing or improperly legalized foreign documents, or starting a regulated activity before the license is granted. Each of these can stall registration or expose the company later. Control comes from aligning the articles with the intended share and management structure, matching every capital and identity document to the file, and confirming sector requirements before, not after, operations begin. Shareholder agreements drafted at formation should fix governance and deadlock mechanics before a dispute makes them contested.
Frequently asked questions
Can a foreigner own 100 percent of a Turkish company? Yes. Under the Foreign Direct Investment Law No. 4875, foreign investors may hold full ownership of a Turkish company on the same terms as domestic investors, with no prior approval and no mandatory local partner for most sectors. Restrictions apply only in specifically regulated areas defined by sector legislation.
Can incorporation be completed remotely? In most cases the process can be handled without travel. A properly issued and legalized power of attorney lets local counsel reserve the name, file the notarized articles of association through MERSiS, and complete tax and SGK registration. The investor’s physical presence is usually needed only for certain bank account steps, which vary by bank.
Is a local partner or fiscal representative required? For most sectors, no. The Foreign Direct Investment Law No. 4875 does not require a Turkish partner. A local representative is needed where shareholders or directors are non-resident, mainly to receive official correspondence and to act under a power of attorney during formation.
How long does company formation take? A complete file submitted through the trade registry is typically processed within a few business days, but the realistic timeline depends on document readiness, foreign-document legalization, and any sector licensing. Building the documentary file correctly is what compresses the timeline.
Related corporate guidance
To move from formation to operation, see how to register a company in Turkey, the broader walkthrough on setting up a business in Turkey and international company formation, and ongoing corporate legal counselling in Turkey.
For end-to-end incorporation, structuring, and post-formation compliance handled by counsel, work with our corporate and commercial law team.
General information, not legal advice. Turkish law; verify your specific situation with qualified counsel.