Foreign investors may establish a company in Türkiye under substantially the same legal framework applicable to Turkish investors. In practice, the two most frequently selected corporate vehicles are the limited liability company and the joint stock company. Both are capital companies under the Turkish Commercial Code and both may be used for ordinary commercial operations, shareholding structures, production investments, service businesses and investment incentive projects.
This guide has been prepared by Resen Legal with reference to the Turkish Commercial Code No. 6102, Foreign Direct Investment Law No. 4875, the Ministry of Trade MERSIS system, the official investment guidance published by the Investment Office of the Presidency of the Republic of Türkiye, Presidential Decision No. 9903 on State Aid for Investments, and Communiqué No. 2025/1 issued by the Ministry of Industry and Technology. The guide reflects the principal rules and official data reviewed as of 24 June 2026.
Foreign Direct Investment Law No. 4875 is based on investment freedom and national treatment. Unless an international treaty or a special statute provides otherwise, foreign investors are free to make direct investments in Türkiye and are subject to equal treatment with domestic investors. Accordingly, a foreign shareholder is not required to incorporate a special foreign-invested company type merely because the capital originates abroad.
The same law also regulates core investor protections. Direct foreign investments may not be expropriated or nationalised unless public interest and compensation requirements are met under applicable law. Net profits, dividends, sale proceeds, liquidation proceeds, compensation payments, licence and management fees, and foreign loan principal and interest payments may be transferred abroad through banks or authorised financial institutions.
This general freedom does not remove sector-specific licensing or ownership restrictions. Banking, insurance, capital markets, payment services, energy, mining, broadcasting, civil aviation, maritime activities, defence-related matters, free zones, data centres, healthcare, education and certain regulated services may require additional permits, regulatory approvals or sectoral structuring before commercial activity begins.
Article 124 of the Turkish Commercial Code lists commercial companies as collective companies, commandite companies, joint stock companies, limited liability companies and cooperatives. For foreign investors, the decisive practical distinction is that joint stock companies and limited liability companies are capital companies. The company is liable for its debts with its own assets, while shareholder liability is principally limited to the capital commitment and, for limited companies, any additional obligations expressly included in the articles of association.
A joint stock company is a company whose capital is determined and divided into shares. It is liable for its debts only with its own assets, and shareholders are liable only to the company and only for the capital they have subscribed. Under the current minimum capital framework, the minimum initial capital for an ordinary joint stock company is TRY 250,000. For a non-public joint stock company adopting the registered capital system, the minimum initial capital is TRY 500,000.
At least one founder is sufficient. The articles of association must be in writing and must include, among other matters, the trade name, registered office, business object, capital, nominal value of shares, payment terms, share types, transfer restrictions where applicable, management structure, general assembly procedures and initial board members. The articles are signed before the authorised trade registry personnel or before a notary public.
For cash capital, at least 25 percent of the subscribed capital must be paid before registration and the remaining amount must be paid within twenty-four months following registration. Where capital in kind is contemplated, valuation, registry annotation and absence of encumbrance issues must be reviewed before filing.
A limited liability company is established under a trade name by one or more real or legal persons. Its registered capital is specific and consists of the total registered capital shares. The company may be established for any economic purpose and subject matter not prohibited by law. The number of shareholders may not exceed fifty.
The minimum capital for a limited liability company is currently TRY 50,000. Unlike joint stock companies, the rule requiring payment of at least 25 percent of the cash capital before registration does not apply to limited companies. The capital payment schedule should still be planned carefully because unpaid capital obligations, accounting records and later share transfers may create practical issues.
Limited companies are often suitable where the investor expects a more compact shareholder structure and does not require share certificates, share classes or capital market-oriented governance. However, where future investment rounds, employee option structures, preference rights or exit mechanics are anticipated, the joint stock form may be more efficient.
Company formation is carried out through the trade registry directorates operating within chambers of commerce. The Ministry of Trade's Central Registry Record System, known as MERSIS, is the electronic infrastructure used for trade registry transactions. MERSIS enables company establishment, amendment and cancellation transactions to be conducted electronically and assigns a unique number to legal entities and other economic units.
For a foreign-invested limited or joint stock company, the usual formation sequence is as follows:
Where the foreign shareholder is a real person, the file typically includes passport copies, notarised Turkish translations, tax number documentation and, where applicable, residence permit documentation. Where the foreign shareholder is a legal entity, the file usually includes a certificate of activity or equivalent corporate registration document, a resolution authorising the Turkish incorporation, documents showing authorised signatories, and a power of attorney if the filing is handled by representatives.
The most common practical risk is inconsistency between the foreign corporate documents and the Turkish filing package. The shareholder's name, registered office, signatory authority, legalisation chain, apostille text, translation, intended company name, capital commitment and appointment of managers or board members should be reviewed together before the registry appointment.
A foreign company may also establish a branch in Türkiye. A branch is not a separate legal entity from the foreign parent and is generally registered for the same business purposes as the parent company. In many investment projects, however, a subsidiary in the form of a limited or joint stock company is preferred because it creates a separate Turkish legal person, clearer local governance and a more straightforward framework for incentives, contracts, employment and tax registration.
A liaison office is different. It may be opened by a foreign company with permission from the Ministry of Industry and Technology, but it may not conduct commercial activity in Türkiye. Liaison offices are used for market research, representation, coordination and similar non-revenue activities. They should not be used as a substitute for a trading company where invoicing, sales, employment for operational purposes or local service delivery is intended.
Türkiye's investment incentive framework was materially renewed by Presidential Decision No. 9903 on State Aid for Investments, published in the Official Gazette on 30 May 2025. The implementing rules are set out in Communiqué No. 2025/1, published on 21 June 2025. The former 2012/3305 framework has been repealed for new applications, while earlier incentive certificates continue to be governed by the legal regime under which they were issued, subject to transitional rules.
The current system is administered by the Ministry of Industry and Technology through the General Directorate of Incentive Implementation and Foreign Investment. Applications, revisions and related procedures are handled through E-TUYS, the electronic incentive implementation and foreign investment information system. Under Communiqué No. 2025/1, an application for an investment incentive certificate may not be made for a legal entity whose establishment process has not yet been completed.
Under Decision No. 9903, the incentive system consists principally of the Türkiye Century Development Initiative, the Sectoral Incentive System and regional incentives. The Türkiye Century Development Initiative includes the Technology Initiative Program, Local Development Initiative Program and Strategic Initiative Program. The Sectoral Incentive System includes Priority Investment Incentives and Target Investment Incentives.
Depending on the investment category, location and project characteristics, an investment incentive certificate may provide access to one or more of the following support elements:
As a general threshold, where no special minimum is prescribed, the minimum fixed investment amount is TRY 12 million in Regions 1 and 2 and TRY 6 million in other regions. These Turkish lira thresholds are updated annually by reference to the revaluation rate under the applicable rules. Investors should therefore verify the current threshold and the investment subject list at the time of application.
The incentive certificate does not legalise a project by itself. It does not replace environmental, zoning, workplace opening, operating licence, sectoral authorisation, energy, mining, health, education, data centre, tourism, free zone or other permits required under separate legislation. The project must be structured so that company establishment, land or lease arrangements, permits, financing, machinery procurement and incentive application timing are consistent.
Investment expenditures made before the incentive certificate application date are not included within the scope of the incentive certificate. For this reason, purchase orders, down payments, import procedures, invoices, financial leasing arrangements and construction spending should not be initiated without checking incentive timing. The beginning date of the investment is generally the incentive certificate application date.
Incentive files also require completion visa follow-up. Under the current rules, the investor must apply for completion visa within the prescribed period after the investment term or additional term expires. Failure to comply with certificate conditions, minimum investment amounts, employment commitments, ecosystem development plans, documentation duties or asset retention requirements may lead to cancellation or recovery of supports with sanctions.
The decision should not be made only by comparing minimum capital amounts. A foreign investor should assess the expected shareholder structure, future investment rounds, intended sector, need for share transfer flexibility, governance model, tax position, financing structure, incentive eligibility, exit route, public tender requirements and potential regulatory approvals.
Resen Legal approaches foreign-invested company formation as a structuring matter, not merely as a registry filing. Before incorporation, the shareholder profile, company form, articles of association, signatory authority, foreign document chain, tax position, intended business model and possible incentive route should be reviewed as a single file.
For investment incentive projects, early legal planning is particularly important. The wrong sequence between incorporation, procurement, financing, importation, construction and incentive application may cause otherwise eligible expenditure to fall outside the incentive certificate. A properly structured timeline reduces registry defects, tax mismatches, document inconsistencies and support recovery risks.
This article is provided for general informational purposes only. The appropriate company type, foreign document requirements, sectoral restrictions, tax position, work permit needs, investment incentive eligibility and application timing should be assessed separately for each investor, project and transaction.
