Opening Branch Office in Turkey involves very careful steps under the Turkish regulatory framework. Relevant companies should benefit from a full-fledged legal guidance by Turkish business lawyers.
Introduction
Opening branch office in Turkey requires careful adherence to the country’s regulatory framework. The legal or business headquarters of the parent company must systematically follow a series of steps to ensure compliance. This article provides a detailed overview of the corporate governance consulting services available to foreign companies seeking to establish a branch in Turkey.
The present article will present a comprehensive corporate governance consulting service dedicated to Opening Branches of Foreign Companies in Turkey.
In terms of corporate governance consulting, check out our practice area on Corporate Governance
Can foreigners open a company in Turkey?
Following the regulatory amendments introduced by the Foreign Direct Investment Law numbered 4875, the distinction between foreign and domestic investors was abolished in 2013. As a result, foreign investors are entitled to equal treatment with domestic investors under Turkish law. Furthermore, the principles and standards outlined in the Turkish Commercial Code facilitate the establishment and operation of foreign-led companies in Turkey.
It is critical to underline that thanks to regulatory change on the Foreign Direct Investment Law (Numbered 4875), the difference between foreign or national investors was eradicated under Turkish legal system in 2013.
For more information about company establishment procedure take a look at our article on Establishment of a Company in Turkey
How do I open branch office in Turkey?
Commercial enterprises whose legal or business centres are abroad, without prejudice to the provisions of the laws of their own countries’ trade titles, can make branches registered as domestic commercial enterprises. Under Article 40 of the Turkish Commercial Code, branches of commercial enterprises with headquarters outside Turkey are registered in the same manner as domestic commercial enterprises, provided that the provisions of their national legal framework regarding trade names are preserved.
For these branches, a fully authorized commercial representative with a domicile in Turkey must be appointed. Foreign companies looking to establish a branch in Turkey must comply with the aforementioned article and the relevant regulations issued by the Ministry of Trade.
What is the difference between opening a liaison office and opening branch office in Turkey?
In contrast to liaison offices, branch offices are completely free to engage in commercial activities in Turkey.
Concerning more discussion about liaison offices, review our article on Formation of Liaison Offices in Turkey
Core Features of Opening Branch Office in Turkey
One needs to bear in mind that a branch does not have a separate legal personality from its parent company. Legal and business center of the Company has full responsibility for the branch. What is more, the branch cannot operate under its own name but under the name of the foreign company.
Main Steps for Opening Branch Office in Turkey
Most important part is to appoint a fully authorized branch manager who is either a Turkish citizen or a foreign national with a valid work permit.
In terms of registration procedure, the following documents must be obtained and notarized:
- The central company’s Articles of Association and Certificate of Incorporation,
- A resolution from the parent company’s board approving the establishment of a branch in Turkey,
- A notarized power of attorney appointing a branch representative in Turkey,
- A statement declaring the branch manager’s authority and responsibilities,
The above-mentioned documents are submitted to the Trade Registry Office in the city where the branch will operate. Upon approval, the branch is officially registered, and a tax identification number is obtained afterwards.
Conclusion
Opening branch office in Turkey allows foreign companies to establish a local presence and operate within the Turkish market. However, full compliance with Turkish regulations is essential to ensure seamless operations and avoid legal complications. The registration process requires submitting specific documents to the relevant Trade Registry Office.
For expert legal guidance on opening a branch in Turkey, consult our corporate governance and business law specialists.
