Turkey is a Muslim country with many cultural characteristics, rich history, traditions, and mental differences. Over the past decades, the Turkish economy has been actively developing. Now, attracting foreign investors is a priority in the Turkish economy. So, no distinction is made between foreigners and Turkish citizens in terms of establishing new companies.
The main advantages of opening a business in Turkey
The main advantage of opening a business in Turkey is its geographical location. The country is located between Europe and Asia and has access to the Middle East and Africa. It means that trade routes of world importance pass through its territory.
Factors that make it easier to do business in Turkey:
- a relatively simple process of obtaining permits, licenses, and other documents;
- the same benefits and rights for resident and non-resident entrepreneurs;
- Turkey ranks sixth in terms of GDP in Europe (the US $ 851.1 billion);
- the country’s authorities are regularly reforming the economy. A significant part of the innovations concerns the abolition of restrictions on the inflow of direct investment. A foreigner can open a business in just 7 days;
- developed system of sea and land communication systems, including the railway network;
- Turkey has signed free trade agreements with 12 countries and an agreement on the avoidance of double taxation with 68 countries.
Which direction to choose
All projects announced by foreign business persons are considered by the Investment Office, which is a division of the Treasury Department under the Office of the Prime Minister of the Republic. The criteria used by officials when selecting projects are:
- export opportunities;
- the prospect of using local resources.
What kind of business you can open in Turkey and what to do in the market for goods and services will depend on the scale of the upcoming economic activity. Most entrepreneurs choose the most developed industries in the country:
- hotel business in Turkey;
- international trade.
Which region to choose
The choice of the territory where the project will be implemented should depend on the field of activity.
Economic zones in Turkey can be divided into several groups:
Technological Development Zones
Technological Development Zones bring together research and development companies located in Istanbul and Bursa. Until 2023, companies working on the creation of software are exempt from paying income tax.
Organized industrial zones
Organized industrial zones are characterized by the abolition of VAT when buying a plot of land, and property owners are exempt from tax on it for 5 years. Such rules apply, for example, in the city of Sakarya.
Free zones are not subject to customs regulations. They are most often located near eastern and European markets, in port areas. Enterprises are exempt from VAT, customs, and port duties. Ataturk Airport is an example.
Business in Antalya, Alanya, Kemer, and other resort regions is best built on the tourist destination and the service sector. Istanbul is a concentration of business and capital. Nearly 50% of transactions in Turkey take place here.
Choice of organizational and legal form in Turkey
The Commercial Code of the Republic of Turkey provides for 5 types of forms of ownership that can be opened by foreigners and residents:
The number of company owners can be 2-50 people (individuals and legal entities), and their liability is limited to the size of the contribution to the authorized capital, the total amount of which must not be less than 10 thousand Turkish lire (3.4 thousand US dollars).
Joint Stock Company
JSC assumes at least 5 owners of the enterprise (legal entities and individuals). A company is managed by a board of directors. The authorized capital is 50 thousand lire (about $ 17,000).
It is created to manage a company under a brand name. There is no requirement for a minimum authorized capital.
Shareholders can only be individuals whose liability is not limited.
It is an association of shareholders with equal rights in the management of the company.
In addition to these forms, foreigners are allowed to open branches of foreign companies or act as private entrepreneurs.
Process of opening a business in Turkey
The most profitable form of doing business will be a medium or small business in Turkey in one of the five types indicated above. To open a company, you need to go through several stages:
- Register in MERSIS (information system for working with the commercial register) the company’s charter and memorandum of association. There is no charge for this service;
- Certify company documents with a notary;
- Obtain the taxpayer’s TIN;
- Transfer 0.04% of the authorized capital to the account of the Antimonopoly Committee of the Central Bank of Turkey;
- Open a bank deposit account and put 25% of the company’s capital on it. The rest can be paid within two years;
- Register with the Commercial Register;
- Register with the company’s legal books notary department.
How to open a business visa in Turkey
The next step in the implementation of the project is the request for a visa permit, which in the future will give the right to obtain a residence permit. For representatives of states with which Turkey maintains a visa-free regime, a short-term entry into the country on business without a visa is possible. But to get a residence permit, you will need a business visa to Turkey. To request it, you need to prepare the following package of documents:
- Visa application;
- Foreign passport with a copy of the main spread;
- National passport and its copy;
- An invitation from a Turkish partner;
- Financial guarantees;
- Receipt of the paid fee.
It is better to apply in advance since the consulate may request additional papers, and the process will be significantly delayed.