Company Formation in Türkiye for Foreign Investors: What to Know First

Türkiye is an increasingly common destination for foreign investment, a large domestic market, a strategic position between Europe, the Middle East and Asia, and a company law framework that is, on its face, open to foreign capital. For many investors the headline is reassuring: you can own a Turkish company outright, and you do not need to live in the country to do so.

That openness is real. But the ease of forming a company should not be confused with the ease of running one correctly. The decisions that matter most are usually taken before incorporation, and they are difficult to unwind afterwards.

Foreign ownership: the starting position

Under Turkish law, foreign investors are, as a general rule, treated on the same footing as domestic ones. In most sectors that means:

• a company may be 100% foreign-owned, with no requirement for a Turkish partner;
• a foreign shareholder does not need to reside in Türkiye; and
• incorporation can be completed remotely, through a power of attorney, without the investor travelling for each step.

There are exceptions, certain regulated sectors carry specific restrictions or licensing requirements, which is one reason the intended business activity should be defined precisely at the outset rather than described in broad terms.

Choosing the right structure

The most common vehicle for foreign investors is the limited liability company (limited şirket), which can be formed with a single shareholder and offers limited liability with a relatively straightforward governance model. For larger or capital-raising ventures, the joint-stock company (anonim şirket) may be more appropriate.

The choice is not merely administrative. It affects share transfers, the tax treatment of profits and dividends, management structure, and the ease of bringing in future investors. Selecting the wrong vehicle is among the more expensive mistakes to correct later.

What incorporation actually involves

Company formation in Türkiye is governed by the Turkish Commercial Code (Law No. 6102) and is handled through the relevant Trade Registry Directorate. In broad terms, formation requires:

1. a clearly defined business activity and company name;
2. at least one shareholder and the company's share capital;
3. a registered address in Türkiye;
4. articles of association and the supporting incorporation documents; and
5. registration with the Trade Registry, followed by tax registration.

Around these steps sit practical matters that are easy to underestimate from abroad, notarisation and apostille of foreign documents, obtaining tax identification numbers, opening a corporate bank account, and registering for VAT and social security where relevant.

Tax and ongoing compliance

Formation is the beginning, not the end, of a company's legal obligations. A Turkish company is subject to corporate tax, VAT and withholding obligations, and to bookkeeping, reporting and filing duties that continue for as long as it operates. Where the shareholders or the group sit in other jurisdictions, double-tax treaties and the structure of dividends and intra-group arrangements deserve attention from the outset.

Investors who plan only to the point of incorporation often find the compliance burden, and its cost, larger than expected. Planning the operating model alongside the formation is what avoids that.

Why this is a legal question, not just an administrative one

A company can be registered quickly. Registering it well, with the right structure, a clean activity definition, a compliant address and a tax position that works across borders, is a different exercise, and it is where experienced counsel earns its place.

How we help

We advise foreign investors and businesses on establishing and operating companies in Türkiye, from choosing the structure and preparing incorporation through to ongoing corporate and commercial support. Where an investment also reaches into Northern Cyprus or the United Kingdom, we coordinate the counsel and the jurisdictions involved so the parts fit together.

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This article is provided for general information only and does not constitute legal advice. The law and procedure summarised here may change and can apply differently to individual circumstances. Obtain advice on your specific situation before taking any step.