How to Set Up a Company in Turkey: Limited and Joint Stock Companies
The most common company types for entrepreneurs and foreign investors starting a business in Turkey are the limited liability company (limited şirket) and the joint stock company (anonim şirket). The choice of company type directly affects the capital requirement, the liability of shareholders, share transfers and the management structure. This article by Yetkiner Law Firm explains the minimum capital requirements, the incorporation steps, the required documents, the differences between limited and joint stock companies, and the points foreign investors should consider when setting up a company in Turkey.
In Brief: Company Formation in Turkey
- The minimum share capital is 50,000 Turkish lira for a limited company, 250,000 Turkish lira for a joint stock company and 500,000 Turkish lira initial capital for a non-public joint stock company using the registered capital system.
- Both company types can be established with a single shareholder.
- Incorporation starts on the Central Registry System (MERSİS) and is completed by registration with the trade registry office.
- Foreign individuals and companies can set up a company in Turkey on the same terms as Turkish citizens.
Minimum Capital Requirements
Under Articles 332 and 580 of the Turkish Commercial Code and Presidential Decision No. 7887, the following minimum capital amounts have applied since 1 January 2024:
- Limited company: 50,000 Turkish lira share capital.
- Joint stock company: 250,000 Turkish lira share capital.
- Non-public joint stock company in the registered capital system: 500,000 Turkish lira initial capital.
For existing companies with capital below these amounts, the deadline to increase their capital was extended to 31 December 2027 by a Ministry of Trade communiqué published in the Official Gazette on 17 October 2026.
When Must the Capital Be Paid?
In a joint stock company, at least 25 percent of the nominal value of shares subscribed in cash must be paid before registration, and the remainder can be paid within twenty-four months after registration. In a limited company, the cash capital can be paid within twenty-four months after registration. A Competition Authority fee calculated on the capital must also be paid during incorporation.
Limited Company or Joint Stock Company?
The following differences are usually decisive when choosing the company type:
- Capital: A limited company has a lower minimum capital, which can be paid in full after registration.
- Liability for public debts: Shareholders of a limited company can be held liable, in proportion to their capital shares, for public receivables such as taxes and social security premiums that cannot be collected from the company. Shareholders of a joint stock company do not have such personal liability; liability generally rests with the legal representatives.
- Share transfers: In a limited company, share transfers require a written agreement with notarised signatures and, as a rule, the approval of the general assembly. Share transfers in a joint stock company are easier and generally do not require general assembly approval.
- Number of shareholders: A limited company cannot have more than fifty shareholders, while there is no such limit for a joint stock company.
- Management: A limited company is managed by one or more managers, while a joint stock company is managed by a board of directors consisting of one or more members.
- Investment and public offering: If a public offering, investment from funds or a structure with many shareholders is planned, a joint stock company is generally more suitable.
A limited company is usually preferred for small and medium-sized businesses with few shareholders, while a joint stock company is generally preferred for structures that aim to grow, attract investment or transfer shares frequently.
Steps to Incorporate a Company in Turkey
- Trade name and business activities: The company’s trade name, registered office and business activities are determined. The trade name must not belong to another company.
- MERSİS application: The incorporation application is made through the Central Registry System (MERSİS), where the articles of association are prepared.
- Signing the articles of association: The founders sign the articles of association before an authorised officer at the trade registry office or before a notary.
- Capital and Competition Authority fee: For a joint stock company, 25 percent of the capital is deposited in a bank; for both company types, the Competition Authority fee is paid.
- Application to the trade registry office: The application is submitted with the required documents to the trade registry office where the company’s registered office is located.
- Registration and publication: The company acquires legal personality upon registration, and the registration is published in the Turkish Trade Registry Gazette.
Post-Incorporation Steps
After registration, the tax office carries out an inspection of the business premises, the opening certification of the commercial books or the electronic ledger registration is completed, and a registered electronic mail (KEP) address and a bank account are opened in the company’s name. If employees will be hired, the workplace must be registered with the Social Security Institution. Joint stock companies above a certain capital threshold should also consider the obligation to retain a contracted lawyer.
Documents Required for Incorporation
- The articles of association prepared and signed through MERSİS,
- Identity documents of the founders and, for foreigners, a notarised Turkish translation of the passport and a Turkish tax number,
- Appointment documents and signature declarations of the managers or board members,
- For joint stock companies, a bank letter confirming payment of the capital,
- A receipt showing payment of the Competition Authority fee,
- A valuation report if capital in kind is contributed.
Setting Up a Company in Turkey as a Foreigner
Under the Foreign Direct Investment Law No. 4875, foreign investors receive equal treatment with Turkish investors and do not need a separate permit to establish a company. The following points should be considered when incorporating a company with foreign shareholders:
- Foreign individual shareholders: A notarised Turkish translation of the passport and a tax number obtained in Turkey are required.
- Foreign corporate shareholders: A certificate of good standing and authorisation documents from the country of registration must be submitted with an apostille or consular legalisation and a Turkish translation.
- Power of attorney: Founders do not need to travel to Turkey; the incorporation can be handled through a power of attorney issued at a Turkish consulate or by a foreign notary with an apostille.
- Work and residence permits: Foreigners who will work in the company as managers or employees must obtain a separate work permit.
Instead of incorporating a Turkish company, a foreign company may also open a branch or a liaison office in Turkey. A liaison office cannot engage in commercial activities and is limited to activities such as promotion and market research. For collecting the company’s receivables in Turkey, see Debt Collection in Turkey.
Frequently Asked Questions
Can a company be set up in Turkey with one shareholder?
Yes. Both limited companies and joint stock companies can be established with a single shareholder.
Does the capital of a limited company have to be paid upfront?
No. In a limited company, the cash capital can be paid within twenty-four months after registration. In a joint stock company, at least 25 percent of the cash capital must be paid before registration.
How long does it take to set up a company in Turkey?
When the documents are complete, registration can usually be completed within a few business days. For companies with foreign shareholders, the apostille and translation of documents from abroad may extend this period.
Can a foreigner own 100 percent of a company in Turkey?
Yes. Foreign investors can establish a company wholly owned by them, without any requirement to have a Turkish shareholder.
Can a limited company be converted into a joint stock company?
Yes. Under the conversion provisions of the Turkish Commercial Code, a limited company can be converted into a joint stock company if the capital and general assembly requirements are met.
Yetkiner Law Firm provides legal support in İzmir in English, French and Turkish on company formation, drafting articles of association, share transfers, general assembly procedures and the incorporation of companies with foreign shareholders. The firm can be reached through the channels on the contact page.
The information on this page has been prepared for general informational purposes and does not constitute legal advice. It is recommended to obtain legal support from a lawyer in specific cases.
