Foreigners Establishing Companies and Residence Rights in Turkey

Questions

How can a foreign person establish a company in Turkey?
On which laws is the right of foreigners to establish a company in Turkey based?
Can foreign partners who establish companies in Turkey obtain residence permits?
Which type of company is more suitable for foreigners in Turkey?
Is it possible to obtain a short-term residence permit by establishing a company in Turkey?
What is the capital requirement for foreigners to establish a company?
Does establishing a company in Turkey grant the right to apply for citizenship?
Can foreign legal entities establish a company in Turkey?
Can foreigners who establish companies in Turkey obtain family residence permits?
How does tax liability work in companies with foreign partners?
Is it mandatory for foreigners to provide a company address?
What is the duration of obtaining a residence permit by establishing a company?
What are the audit processes for companies established by foreigners in Turkey?
Can a person who obtains a residence permit by establishing a company work?
Are there incentives for foreign entrepreneurs in Turkey?
How do notary and chamber of commerce procedures work during company establishment?
Can foreign investors establish their company via power of attorney?
What documents do foreigners need when establishing a company?
How long does it take to obtain citizenship by establishing a company?
Is professional consultancy necessary when establishing a company in Turkey?

The Process and Legal Basis for Foreigners Establishing Companies in Turkey

Under which laws can foreigners establish companies in Turkey?

Turkey is an attractive country for foreign investors due to its proximity to both European and Asian markets and its developed trade infrastructure. In this context, the legal bases applicable to foreign natural or legal persons wishing to establish companies in Turkey are regulated within certain legislations.

The fundamental regulation concerning foreigners establishing companies in Turkey is Law No. 4875 on Foreign Direct Investments and its implementing regulations. Under this law, the principle of equal treatment between foreign investors and domestic investors is established. That is, a foreign national can establish a company under the same rights and obligations as a Turkish citizen.

The Turkish Commercial Code regulates in detail the types of companies foreigners can establish and the incorporation procedures. The most preferred types of companies are:

Limited Company (LTD): Can be established with at least one partner. A foreign national can be both a partner and a director.
Joint Stock Company (A.Ş.): Can be established with at least one partner and is preferred for larger investments.
Branch or Liaison Office: It is possible for a company already operating abroad to open a representation office in Turkey.

The bureaucratic steps foreigners encounter when establishing a company in Turkey include registration in the Central Registration System (MERSİS), notification to the tax office, Trade Registry Office procedures, notary approval, and potential tax number acquisition. Additionally, determination of the workplace address and social security institution (SGK) registration are mandatory.

Obtaining professional support, especially through a karşıyaka work permit lawyer or izmir foreigners’ law lawyer, contributes to the complete and swift completion of procedures. Proper management of company establishment forms a secure basis for future residence permit or citizenship applications.

Types of Companies in Turkey and the Most Suitable Options for Foreigners

Which types of companies can foreign investors establish in Turkey?

Several different company types are available for foreign investors who want to engage in commercial activities in Turkey. These company types are valid for foreigners within the same framework as the rights granted to domestic investors under the Turkish Commercial Code. However, the most suitable type should be determined considering the investor’s purpose, capital structure, business volume, and tax obligations.

The company types most frequently preferred by foreign investors in Turkey are:

1. Limited Company (LTD ŞTİ)

Can be established with at least one partner.
The minimum capital is 10,000 TRY.
Partners can be natural or legal persons.
A foreign person can be both a partner and the company director.
Provides tax flexibility and is suitable for small and medium-sized enterprises.
Even if the director does not reside in Turkey, a proxy can be appointed to conduct business.

2. Joint Stock Company (A.Ş.)

Can be established with at least one partner.
Minimum capital is 250,000 TRY (50,000 TRY for non-public companies).
More suitable for large investors and those planning share transfers or public offerings in the future.
Managers (board members) are not required to be Turkish citizens.
Tax advantages are more detailed but management procedures are more formal.

3. Branch Opening

A company established abroad can open a branch in Turkey.
The parent company bears all liabilities.
It does not have a separate legal personality and serves as a representation office.

4. Liaison Office

Cannot engage in commercial activities.
Can only conduct market research, communication, and promotion.
Since it cannot generate income, it is not suitable for residence permit purposes.

For foreign investors, the most suitable company type is generally the limited company because the incorporation process is faster, the financial burden is lighter, and management is more practical. However, if long-term, large-scale investments are planned, choosing a joint stock company is more appropriate.

Determining the company type based on the type and purpose of investment directly affects tax obligations in Turkey and the residence permit application process. Therefore, planning the process together with an izmir citizenship lawyer or a karşıyaka lawyer specialized in investment law allows the foreign investor to save both time and costs.

Legal and Technical Details Foreigners Must Consider When Establishing a Company in Turkey

What are the essential documents and conditions foreigners must know when establishing a company in Turkey?

Although the process of establishing a company is legally possible for foreigners in Turkey, it involves many legal and technical details in practice. Missing these details can prolong the process or cause legal problems. Therefore, comprehensive preparation should be done before starting procedures.

Required Documents:

For foreign natural persons:

Passport (notarized and sworn translation),
Tax identification number (must be obtained from the tax office before company establishment),
Residence address document (foreign address or notarized address declaration in Turkey),
Signature declaration (prepared at a notary).

For legal entity partners:

Activity certificate of the parent company (apostilled and sworn translation),
Trade registry gazette of the parent company,
Sample of decision book (showing authority of the company to establish a company in Turkey).

Technical Steps:

MERSİS Registration: Electronic application is made through the Ministry of Trade’s Central Registration System (MERSİS).
Preparation of Articles of Association: Company articles of association are prepared and notarized.
Tax Office Registration: Application for tax number and potential tax liability of the company is made.
Trade Registry Office Application: Application is made with the necessary documents for official company establishment.
Social Security Institution (SGK) Registration: Social security registration of the company is completed.
Bank Account Opening and Capital Blocking: Minimum capital amount is deposited into a bank account (mandatory for joint stock companies).

Important Points:

The company address must be a real and valid address. Solutions like virtual offices are not accepted.
If one of the partners is not resident in Turkey, notarized power of attorney is required for transactions.
All documents must be translated into Turkish and notarized.
In limited companies, appointment of directors, and in joint stock companies, clear decisions must be made for board memberships.

For foreigners intending to obtain a residence permit or citizenship application while establishing a company in Turkey, proper execution of these procedures is vital. Even the smallest deficiency in the process may result in the rejection of future residence, work permit, or citizenship applications.

Therefore, proceeding in cooperation with an izmir work permit lawyer or karşıyaka foreigners law lawyer provides both legal security and speed during the company establishment process.

Is It Possible to Obtain a Residence Permit by Establishing a Company in Turkey?

Can foreign entrepreneurs obtain residence permits by establishing a company in Turkey?

Foreign nationals establishing companies in Turkey are not only allowed to conduct commercial activities but also have the opportunity to acquire the right of residence. According to Turkish legislation, foreign entrepreneurs who meet certain conditions may apply for a short-term residence permit through the companies they establish.

Relevant Legislation

According to Article 31 of Law No. 6458 on Foreigners and International Protection, "those who will establish commercial connections or businesses in Turkey" are included among foreigners eligible for a short-term residence permit. Accordingly, establishing a company in Turkey by a foreign investor constitutes a valid reason for applying for a short-term residence permit.

Basic Conditions

The foreign person must be an official partner or manager of the company.
The established company must be active and able to document commercial activity.
The company’s business address must be a valid workplace.
Documents proving the company’s activity must be presented during the application (tax plate, trade registry gazette, activity certificate, etc.).

Practical Evaluation

The Directorate General of Migration Management evaluates applications not only based on the fact of company establishment but also on the actual activity status. Therefore, applications made through companies established only on paper but inactive are generally rejected. The company is expected to operate, issue invoices, submit tax declarations, and have social security registrations.

Moreover, documents showing that the foreign investor can provide financial sustenance are also important in the application. In this context, it is necessary to prove regular income from the company or sufficient capital.

Importance of Legal Support

Applications made with the support of a karşıyaka work permit lawyer or izmir residence permit lawyer progress more reliably for foreigners who establish companies in İzmir or other cities. Collecting appropriate documents, making accurate declarations, and maintaining effective communication with the Migration Management for the residence permit become much safer with professional legal support.

Necessary Documents and Application Process for Obtaining a Residence Permit by Establishing a Company in Turkey

What documents must a foreigner preparing to obtain a residence permit by establishing a company prepare?

Foreigners who establish companies in Turkey have the right to apply for a short-term residence permit through this initiative. However, to exercise this right, the relevant documents must be prepared completely, and the procedures determined by the Directorate General of Migration Management must be carefully followed.

List of Application Documents:

Residence permit application form: Filled online via the interactive Migration Management system.
Original and photocopy of passport: Identity information pages and entry stamp pages must be presented.
Four biometric photographs: Taken within the last 6 months, with a white background.
Private health insurance: Valid in Turkey, covering at least the duration of residence.
Address declaration: Notarized with lease contract or title deed.
Tax number: Obtained from the tax office on behalf of the foreigner.
Company documents:
- Trade registry gazette,
- Tax plate,
- Activity certificate (from the relevant chamber of commerce),
- Signature circular,
- Partnership agreement or articles of association.

Application Process:

Appointment Scheduling: Appointment is made through the provincial migration office system of the Directorate General of Migration Management.
Submission of Documents: The above-mentioned documents are submitted on the appointment date.
Evaluation Process: The Migration Management examines whether the company is active and if the applicant earns income from the company.
Approval and Delivery: If the application is successful, the residence card is delivered to the applicant by mail.

Common Mistakes:

Submission of incomplete documents or documents without notarization,
Applications made with companies that are inactive or only established on paper,
Failure to prove the accuracy of the residence address.

Due to these risks, it is recommended to conduct the application with an izmir residence permit lawyer or karşıyaka foreigners law lawyer. A specialist lawyer controls all stages from document preparation to appointment follow-up to ensure safe completion of the process.

Duration and Renewal Process of Residence Permits Obtained by Establishing a Company in Turkey

How long is the residence permit obtained by foreigners establishing a company valid and how is it renewed?

The short-term residence permit, which is the most suitable type for foreign entrepreneurs establishing companies in Turkey, is generally granted for 1 year. However, this permit can be renewed indefinitely as long as the necessary conditions continue. The renewal process requires different documents and attention compared to the initial application.

Permit Duration and Initial Application

The short-term residence permit obtained by establishing a company is generally valid for 1 year.
During application evaluation, the company must prove active commercial activity with documents.
The applicant must provide proof of residence address and income to sustain themselves.

How to Apply for Renewal?

The application must be made at least 60 days before the residence permit expires.
Renewal applications are also made through the Directorate General of Migration Management’s online system.
Most documents submitted during the first application must be prepared again. However, this time, documents showing the company’s continued activity (e.g., updated tax plate, SGK registrations, activity certificate, etc.) are given greater importance.

Documents Required for Renewal:

Updated trade registry gazette,
Company activity certificate (from the last 6 months),
Updated tax plate,
Documents regarding company income or earnings,
Proof of continuing health insurance,
New lease contract or residence address document.

Points to Consider:

During renewal applications, if the company is inactive, the declared address is invalid, or SGK and tax obligations are not fulfilled, the residence permit may be rejected. Therefore, it is important for the company to remain continuously active.

Many foreigners who experience difficulties documenting company activities suffer during the renewal process. Therefore, it is recommended to obtain support from professionals such as an izmir residence permit lawyer or a karşıyaka citizenship application lawyer from the beginning of the process.

Citizenship Application Rights of Foreign Company Owners in Turkey

Can foreign entrepreneurs apply for citizenship in Turkey?

Foreign entrepreneurs operating by establishing companies in Turkey may, under certain conditions, also have the right to apply for Turkish citizenship. However, this application is not directly related to company establishment but is evaluated based on the person’s residence in Turkey, investment, and integration into society.

General Citizenship Application

According to the Turkish Citizenship Law No. 5901, a foreigner wishing to apply for citizenship by general means must:

Have resided in Turkey continuously for at least 5 years,
Prove the intention to settle in Turkey (being a company owner has a positive effect in this regard),
Live harmoniously in society,
Not pose a threat to public order,
Have sufficient proficiency in Turkish,
Demonstrate the ability to support themselves financially in Turkey.

A foreigner who owns a company and meets these conditions can apply for citizenship by general means.

Exceptional Citizenship

Another way is through exceptional citizenship. If the established company makes a large-scale investment, creates employment, or provides economic contribution, the person can be granted Turkish citizenship exceptionally by a presidential decree.

The criteria evaluated in this case are:

The size of the company’s capital,
Annual turnover,
Number of Turkish employees,
Contribution to the Turkish economy.

Evaluation Process

The citizenship application is assessed multilaterally by the Directorate General of Migration Management and the General Directorate of Population and Citizenship Affairs. Whether the company is actually active, whether it fulfills tax obligations, SGK registrations, and declarations are important during this process.

Obtaining investment citizenship consultancy services at this stage prevents rejection of the application and accelerates the legal process. For foreign investors in İzmir, working with experts such as an izmir citizenship lawyer or karşıyaka investment lawyer is a strategic step.

Legal Problems Faced by Foreigners When Establishing Companies in Turkey

What legal problems can foreign entrepreneurs face when establishing companies in Turkey?

Although legally possible for foreigners to establish companies in Turkey, in practice, many bureaucratic obstacles, legal uncertainties, and administrative delays may occur. These problems usually arise from differences in interpretation of legislation, missing documents, or communication failures.

Most Common Legal Problems

Errors in Translation and Notarization Procedures:
Incomplete or incorrect translation of passports and powers of attorney can cause problems during notarization. Even a small error in such documents can lead to cancellation of the entire process.
Incompatibility of Company Address:
Invalid lease contracts used during address declaration or recording the office address as a virtual office are reasons for rejection by the Migration Management and tax offices.
Company Being Inactive:
The foreign company owner applying for residence permit or citizenship must have an actually active company. Companies that do not operate or do not have SGK notification are at serious risk.
Rejections in Residence Permit Applications:
The Migration Management may reject applications if the foreigner cannot prove that the company is commercially active and self-sustaining.
Tax Compliance Deficiencies:
Failure to obtain a tax plate, failure to submit declarations, or irregular transactions may result in fines and company closure.
Irregularities in Powers of Attorney:
Powers of attorney issued abroad without an apostille certification cause validity problems. They cannot be used without notarization in Turkey.

Preventive Legal Measures

Obtaining detailed legal consultancy before company establishment,
Preparing documents completely, with sworn translation and notarization,
Regular management and recording of corporate activities.

To prevent these problems and properly plan the processes, acting together with an izmir foreigners law lawyer or karşıyaka work permit lawyer provides great advantages. Professional support ensures that procedures are completed legally and quickly.

Advantages of Obtaining Residence Permits by Establishing a Company in Turkey

What are the advantages of obtaining a residence permit by establishing a company for foreign investors?

Establishing a company in Turkey is a strategic step that offers foreign investors not only commercial gain but also residence rights, tax advantages, and even the opportunity to apply for citizenship in the long term. Obtaining a residence permit through a company is a more flexible and sustainable method compared to classical residence applications.

Main Advantages:

Acquisition of Residence Rights:
A foreigner who establishes a company in Turkey can obtain a short-term residence permit as long as the business activity is documented. This permit can be renewed annually as long as the activity continues.
Possibility of Residence Leading to Citizenship:
A foreigner who stays continuously for 5 years with a residence permit obtained through the company can apply for Turkish citizenship by general means. This means that company establishment can lead directly to the citizenship process.
Family Residence Permit for Family Members:
The spouse and children of the foreign company owner can also apply for family residence permits and legally stay in Turkey.
Ease of Obtaining Work Permits:
Since the company owner is also the company director, there is no obligation to obtain a work permit. However, permits can be obtained for employed personnel.
Tax Planning and Freedom of Trade:
The company owner can manage their own business and conduct domestic or international trade. Moreover, they can formalize their earnings through the accounting system and perform tax planning.
Real Estate and Investment Rights:
It is possible to acquire real estate or invest in different sectors through the company. These investments also strengthen the residence process.

Advantages Provided by Legal Support:

If this process is completed flawlessly, the foreign investor can secure both residence rights and long-term rights to live and work in Turkey. However, any missing document, declaration, or procedural error can result in losing these advantages.

Therefore, working with professionals such as a karşıyaka citizenship lawyer or izmir immigration law expert strengthens the process and allows long-term strategic planning.

Importance of Legal Support in the Residence Permit Process Obtained by Establishing a Company in Turkey

Why should foreign investors seek legal support during company establishment and residence permit processes?

Although obtaining residence permits by establishing companies in Turkey is an attractive option for foreign investors, every stage of this process requires serious legal knowledge, experience, and careful document management. Even a small deficiency may cause rejection of the application, prolongation of the process, or negative results in later citizenship applications.

Advantages of Legal Support:

Correct Application and Preparation of Documents:
Each type of residence permit requires different documents and conditions. An expert izmir residence permit lawyer ensures documents are prepared correctly and completely.
Legal Compliance of Company Establishment:
Details such as articles of association, activity field, and address declaration are critical both for tax offices and the Migration Management. These documents should be supervised by a karşıyaka foreigners law lawyer to ensure completeness and compliance.
Direct Communication with Migration Management:
Tracking appointment procedures, appeals to requests for missing documents, and submitting additional information are managed much faster and more effectively through professional lawyers.
Legal Objection in Case of Possible Rejections:
If the residence permit application is rejected, it is necessary to object to the decision within the deadline. Objections supported by a lawyer significantly increase the chance of success.
Long-Term Planning and Preparation for Citizenship Application:
The residence permit is a starting point. For investors who want to transfer this process to citizenship application, a long-term legal strategy must be formed. This is only possible with lawyers specialized in the subject.

Foreign investors wishing to obtain residence rights by establishing companies in Turkey are recommended to conduct the entire process with professional support.
KL Legal Consultancy provides end-to-end legal support for both company establishment and residence permit processes.

You can receive professional consultancy from KL Legal Consultancy to ensure your company establishment and residence permit processes proceed completely, securely, and quickly. By contacting our expert lawyers, you can best utilize your legal rights and safely maintain your investment in Turkey.