Setting Up a Company in Turkey: Legal Guide for Foreign Founders

Foreign founders and an adviser reviewing blank company formation documents in Istanbul

Legal and source review date: 27 September 2026. General information only; the correct structure, documents, licences, tax and immigration steps depend on the founders, activity, sector and records current on the filing date.

1. Start with the business model, not the registration form

Foreign investors may make direct investments in Türkiye and are generally subject to equal treatment with domestic investors under the Foreign Direct Investment Law. Equal treatment is the starting rule, not an exemption from the rest of Turkish law. Sector ownership limits, regulatory approvals, sanctions screening, competition rules, tax, employment, immigration and professional rules may still shape the project.

The first legal question is what the Turkish operation will do: contract with customers, employ staff, hold regulated assets, import goods, provide a licensed service, or only conduct non-commercial market research. That answer affects the choice between a Turkish subsidiary, a branch and a liaison office, and it should be settled before drafting an activity clause or selecting an address.

A joint stock company (anonim şirket, or JSC) and a limited company (limited şirket, or LLC) are Turkish capital companies with legal personality. Their familiar English labels are functional translations; they do not make either form identical to a corporation or LLC in another jurisdiction. Governance, capital, financing and share-transfer rules must be read under Turkish law.

Limited liability also needs careful wording. Ownership of a capital company does not create blanket immunity from unpaid capital, personal guarantees, torts, management conduct, public-receivable rules or other liability imposed by special law. Risk depends on the capacity in which a person acted and the legal basis of the particular claim.

2. Subsidiary, branch or liaison office

A Turkish subsidiary is incorporated as a Turkish legal person. A branch is connected to its foreign head office and is not an independent legal entity. A liaison office is a separate regulatory arrangement and generally may not conduct commercial activity. These structures are therefore not interchangeable labels for the same presence.

The comparison should include liability, tax position, permitted activity, contracting method, governance, representative authority, reporting and the foreign parent’s internal approvals. A branch may suit one operating model and a subsidiary another, but neither choice can be made responsibly from a single feature such as capital or filing speed.

A liaison office may be relevant where the intended functions remain within the authorised non-commercial scope. It should not be used as a shortcut for sales, invoicing or other commercial operations. The proposed functions, funding and personnel should be matched to the current permission framework before an application is prepared.

The structure also affects foreign-investment reporting and the evidence required from the overseas founder or head office. Tax residence, permanent-establishment exposure and sector rules require separate analysis. Formation advice should record the assumptions behind the selected vehicle so that a later change in activity does not silently invalidate them.

3. Choosing between a JSC and an LLC

A JSC can be formed by one or more natural or legal-person shareholders. An LLC may also have a single shareholder, but it cannot exceed fifty shareholders. Foreign ownership is possible under the general investment framework, subject to any rule that applies to the actual sector, asset or activity.

The JSC has a board of directors; the LLC is managed by one or more managers. The distinction affects appointment, delegation, representation and corporate approvals. Planned financing, investor entry and exit, share transfers, reserved matters and the handling of future capital should be tested against the relevant form rather than left to a generic template.

An LLC often appears simpler in an ordinary closely held business, while a JSC may offer structures that suit broader ownership or financing plans. That observation is not a universal recommendation. The proper form depends on the intended investors, governance arrangements, regulated status, funding method and exit route.

Founder documents should also be planned around whether the shareholder is an individual or a foreign legal person. A layered group structure does not end the inquiry at the immediate shareholder: beneficial-owner, control, sanctions and bank due-diligence work remains natural-person focused where the governing rule requires it.

4. Current minimum capital and contribution timing

At the legal review date, the statutory minimum capital for a new JSC is TRY 250,000. A non-public JSC adopting the registered-capital system has a minimum initial capital of TRY 500,000. These amounts reflect the current rule read with Presidential Decision No. 7887 and should be checked again on the filing date.

For a cash subscription in a JSC, at least twenty-five per cent of the nominal value is payable before registration and the remainder within twenty-four months after registration, unless the articles or a special rule requires more or earlier payment. Share premiums are paid before registration. Contributions in kind require their own asset, valuation and title analysis.

The statutory minimum capital for an LLC is currently TRY 50,000. The JSC rule requiring twenty-five per cent before registration does not apply to an LLC; cash capital can be paid within twenty-four months after registration under the statutory framework, although the articles or a company decision may set an earlier schedule.

These are legal floors, not a conclusion that the capital is commercially adequate. A licence, bank, work-permit application, financing plan or contract may require a different level or form of funding. Subscribed capital, paid-up capital, shareholder loans and operating cash should therefore be recorded as separate concepts.

Existing companies below the increased minimums are subject to the transition rule in Provisional Article 15 of the Turkish Commercial Code. The current Ministry material identifies 31 December 2026 as the adjustment deadline. Any later extension and the company’s registered resolutions must be checked before buying or relying on an existing low-capital entity.

5. Shareholders, board members, managers and authority

A JSC board may have one or more members, and a member may be a natural or legal person. General company law does not impose a universal Turkish-citizenship or Turkish-residence requirement on every board member. Sector rules, work permission, service needs and tax questions can nevertheless create separate practical or legal constraints.

Where a legal person sits on the JSC board, it designates a natural person to act for it; both the legal person and the representative are registered and announced. A foreign corporate appointment requires a properly adopted corporate decision, current evidence of existence and authority, and the authentication and Turkish translation required for the document.

An LLC may have one or more managers, including a non-shareholder, but at least one shareholder must hold management and representation authority. A legal-person manager designates a natural person to perform the function in its name. General company law does not itself require every manager to be a Turkish citizen or resident.

Management and representation are related but distinct. A JSC is managed and represented by its board unless authority is delegated in the legally permitted manner, and at least one board member must retain representation authority. An LLC’s articles and manager rules determine its model, with relevant JSC representation provisions applied by analogy.

Most purely internal limits on representation do not bind good-faith third parties, while registered joint-signature and branch or head-office limitations receive different treatment. Before a contract is signed, the articles, appointment decisions, internal directive where used, and registered signing pattern should be read together. A title such as founder, shareholder, CEO, director or manager is not proof of authority for a particular act.

6. Articles, business objects and regulated activities

The articles of association are an operative governance document. They must follow the required form and contain the mandatory items for the selected company type, including the trade name, registered office, defined activity, capital and governance provisions. Appointment, reserved matters and the intended representation model should be aligned rather than repaired after registration.

An expansive objects clause is not a regulatory licence. The actual activity should be mapped by product, customer, premises, professional input, data use and regulator. Trade-registry registration does not replace an operating licence, professional authorisation, premises permit, consumer obligation or sector approval.

Certain JSC sectors require Ministry of Trade permission for formation or amendments under the current list. The list includes specified businesses in areas such as finance, insurance, holding, exchange, licensed warehousing, audit, capital markets and free zones. Both the list and the relevant sector legislation must be checked on the filing date.

The registered office also requires more than a postal label. The company should be able to receive official notices and maintain the records required at that address, while premises use, lease, zoning, workplace licensing and sector suitability are checked independently where relevant.

Registration creates the company’s legal personality; signing articles or receiving a MERSIS request number does not. Pre-incorporation commitments, founder liability and capital held before registration can create separate questions, so contracts should state who acts, in what capacity, and what happens if registration is delayed or does not occur.

7. Foreign documents, legalisation and powers of attorney

For a foreign individual founder, the current registry workflow commonly requires a notarised Turkish translation of the passport and the relevant identity or tax-number evidence. Residence-permit evidence may also be requested where the person resides in Türkiye and the applicable checklist calls for it. The competent registry’s current requirements control the filing.

A foreign corporate founder normally needs recent home-register evidence showing its existence and authorised representatives, together with a competent-organ resolution approving the Turkish investment and any appointments. “Good standing” documents differ across jurisdictions; each record should be checked for what it actually proves, its issuing authority, date and signatories.

Foreign public and corporate documents follow the authentication route applicable to the issuing country and document. Apostille may apply where the relevant convention relationship covers the document; otherwise Turkish consular legalisation or another prescribed route may be needed. Apostille is neither universally sufficient nor universally required, and it does not verify the truth of private-document content.

The accepted Turkish translation, notarisation and certification steps should be confirmed for the exact instrument. A translation does not repair missing corporate authority, and legalisation does not enlarge the underlying decision. Country, document type, issuing authority, treaty status and local registry practice must be considered together.

Where a representative will handle formation, the power of attorney should identify the acts actually delegated, such as registry filings, tax steps, signatures or related capital acts. Generic wording may omit a necessary power. Form, legalisation, translation, substitution, revocation and decisions reserved to the founder require matter-specific review.

The Istanbul Trade Registry publishes useful JSC and LLC checklists, but another competent registry may use different local forms or request updated evidence. The live checklist should therefore be refreshed before filing, especially where there is in-kind capital, a legal-person manager or board member, a regulated activity, or documents issued abroad.

8. MERSIS and trade-registry workflow

Company establishment data and articles are prepared electronically through the Central Registry Record System, known as MERSIS, and the filing is completed through the competent trade registry directorate. MERSIS can support foreign-participant and potential tax-number steps, but an online draft is not the same as an accepted and completed registration.

The working file should connect the chosen trade name, address, objects, capital, shareholders, governing body and representation model. It should also track translations, legalisations, founder decisions, signature documents, capital evidence and any sector consent. Inconsistency across these materials is a common reason for queries and revision.

Registration is the point at which a JSC or LLC obtains legal personality. The registration result, announcement record and certified corporate materials should be obtained rather than inferred from a submission receipt. Chamber, statutory-book and connected activation steps should be recorded separately so that a completed filing is not mistaken for complete operational readiness.

Official materials sometimes describe an efficient one-stop or rapid formation process. They assume a complete ordinary file and do not promise a result within a fixed number of hours or days. Authentication, translation, registry review, the address, appointments, capital, regulated activity and foreign-document questions can alter both timing and cost.

9. Tax activation, notices, records and electronic systems

MERSIS and the registry exchange incorporation information with tax and social-security systems. That integration does not prove that every tax, payroll, workplace or employee filing has been completed. The company should verify its live tax registration, assigned activities, address records and any employee-specific activation before it begins trading or hiring.

Commercial companies must establish the books, invoices, supporting records, preservation and filing processes required for their form and activity. The trade registry certifies specified initial books during formation under the current workflow, while later approvals, electronic formats and retention obligations depend on the applicable rules and the company’s circumstances.

Corporate-income taxpayers are mandatory users of the tax electronic-notification system under the current Tax Procedure Law Article 107/A. A tax electronic notice is deemed served at the end of the fifth day after delivery to that system. This is distinct from ordinary email and other official electronic-address systems, so access and monitoring responsibility should be assigned from the start.

A new company is not automatically subject to every e-Invoice rule merely because it has been incorporated. The current scope depends on turnover, activity, transaction and special-category rules; voluntary entry may also be available. Thresholds and transition dates change, so the company’s position should be checked against the live Revenue Administration material before issuing its first documents.

E-Ledger is a separate analysis. Its technical creation, approval, preservation and production duties cannot be inferred from registration or e-Invoice status alone. The accounting system, professional support, declaration calendar and corporate approval records should be designed together, without assuming that one electronic enrolment completes all tax and recordkeeping duties.

10. Beneficial ownership, E-TUYS and banking

Beneficial-owner reporting begins with natural persons holding more than twenty-five per cent of a legal person’s shares. If that test does not identify the real controller, the analysis moves to natural persons exercising ultimate control and then to the senior-executive fallback. It is a substantive control inquiry, not a box completed by naming the immediate foreign parent.

Corporate taxpayers report beneficial-owner information through their provisional and annual corporate-tax returns under the current framework. A new tax registration or a change in previously reported information also engages the one-month update rule in General Communiqué No. 529. The actual event date and current filing system must be verified before calculating a deadline.

Foreign-capital companies have a separate E-TUYS reporting stream. The current official guide describes annual activity information for the previous calendar year through EK-1 by the end of May, and capital-account payment information through EK-2 within one month after payment. The live form, authorisation and deadline should be rechecked before submission.

MERSIS registration, trade-registry publication, beneficial-owner reporting and E-TUYS are separate records. Completion of one does not prove completion of the others and does not confer an operating licence. The shareholder ledger, capital evidence and accounting entries should support the information submitted through each system.

Bank onboarding is another separate gate. Banks are obliged parties under anti-money-laundering legislation and must identify customers and apply prescribed due-diligence measures. Incorporation and a potential tax number therefore do not guarantee an account, a particular product, a currency, transfer capability or an onboarding timetable. The selected institution’s current evidence requirements must be obtained directly.

Capital and source-of-funds materials should be consistent across the articles, registry record, founder resolutions, bank documents and accounting entries. A bank request for additional information is not, by itself, a change to the company’s registered status; it is part of the institution’s own legal and risk process.

11. Work, residence, citizenship and post-registration duties

A foreign LLC shareholder-manager or a foreign JSC shareholder-board member who works in that capacity in Türkiye is within the work-permit framework. Corporate appointment and registration do not themselves authorise work. Passive ownership, employment, management and a regulated profession are different legal questions.

The current official work-permit criteria separately assess a foreign company shareholder. At the review date, the published criteria refer to TRY 500,000 company paid-up capital, a TRY 500,000 personal capital contribution, at least twenty per cent ownership, and five Turkish employees from the seventh month, with a stated USD 100,000 capital-share exception. These criteria must be checked on the actual application date, and satisfying them does not create an absolute entitlement.

Forming or owning a company is not a residence permit. A person who will remain beyond the applicable visa or visa-exemption period needs an appropriate residence status or another valid status that substitutes for it. Although a valid work permit can count as a residence-permit substitute under the relevant rule, the route and documents depend on the individual’s facts.

Ordinary company formation also creates no right to Turkish citizenship. Citizenship requires a statutory route and a decision by the competent authority; satisfying application conditions does not create an absolute right. Incorporation, share ownership and capital payment should not be described as a citizenship product.

After registration, responsibility should be assigned for capital payments, shareholder and governing-body records, signing authority, tax e-notification, books, invoices, returns, payroll and social security, beneficial-owner updates, E-TUYS, licences, registered-office notices, annual approvals and bank KYC updates. Later changes must be registered or reported where the applicable rule requires it.

A useful closing record states what has been completed, what remains conditional, who owns each next task and which dates depend on a future event. It avoids a universal compliance calendar detached from the company’s facts. No fixed total cost, formation time, banking result, licence, tax advantage or immigration result can be promised from a general guide.

12. Frequently asked questions and official sources

Frequently asked questions

Can a foreigner own all the shares in a Turkish company?

Generally, the foreign-investment framework permits foreign ownership and equal treatment, and both a JSC and an LLC can have a single shareholder. The proposed activity, sector, assets, sanctions position and any special approval should still be checked; the general rule is not a waiver of sector-specific restrictions.

Should a foreign founder choose a JSC or an LLC?

The answer depends on planned ownership, governance, financing, share transfers, regulated status and exit. A JSC uses a board structure, while an LLC uses managers and must have at least one shareholder with management and representation authority. The articles and signing model should be tested against the actual business plan.

What is the current minimum capital, and when is it paid?

At the review date, a standard JSC requires TRY 250,000, a non-public registered-capital JSC requires TRY 500,000 initial capital, and an LLC requires TRY 50,000. JSC cash shares generally require twenty-five per cent before registration and the balance within twenty-four months; an LLC’s cash capital can generally be paid within twenty-four months. Filing-day law and any stricter special rule must be checked.

Which foreign documents need an apostille?

There is no universal answer. The correct route depends on the issuing country, document type, issuing authority, treaty relationship and the competent registry’s current requirements. Apostille, Turkish consular legalisation or another route may apply, followed by the accepted Turkish translation and certification steps.

Does incorporation guarantee a bank account?

No. A bank must perform customer identification and due diligence and apply its own current onboarding requirements. Registration or a potential tax number does not compel a bank to accept the company, provide a particular product, complete onboarding within a fixed period or process a proposed transfer.

Does setting up a company provide a work permit, residence permit or citizenship?

No. Corporate office or share ownership is separate from permission to work, residence status and citizenship. Each route has its own current conditions, evidence and competent-authority decision. A founder who will work in Türkiye should examine the work-permit position before relying on the corporate appointment.

Official sources

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