Starting a Business in Istanbul: What Founders Should Get Right From Day One

Starting a business in Istanbul can look straightforward from the outside. Choose a company name, prepare the paperwork, register with the Trade Registry and begin trading.

In practice, the registration itself is only one part of the process.

The more important decisions often come before the incorporation application is submitted: what type of company should be established, who should own it, who should manage it, how much capital should be committed, what activities should the company carry out, and what happens if the business later brings in another investor or expands into a regulated sector?

For foreign entrepreneurs, there can be another layer of practical issues involving passports, corporate documents, powers of attorney, apostilles, Turkish translations, tax identification numbers, banking and, where relevant, work permits.

Kurucuk & Associates is an Istanbul-based law firm assisting Turkish and international clients with company formation, corporate structuring and related commercial matters in Türkiye.

This article looks at the process from a founder's perspective — not simply how to register a company, but how to prepare a corporate structure that makes sense for the business you are actually planning to build.

Company Formation in Türkiye: Where Should You Begin?

A useful starting point is to forget the paperwork for a moment and describe the proposed business in practical terms.

Ask:

• What will the company actually do?

• Who will own it?

• Will there be one founder or several?

• Will the shareholders live in Türkiye or abroad?

• Will the company employ people?

• Will foreign nationals work for the business?

• Will the company import or export goods?

• Will it own intellectual property?

• Will it purchase or lease property?

• Will it receive investment later?

• Does the proposed activity require a licence?

• Will customers or suppliers be outside Türkiye?

The answers can influence the company's structure and the documents that should be prepared.

Türkiye's official Investment Guide explains that international investors can establish the company forms recognized under Turkish law and that the foreign direct investment framework is based on equal treatment between international and local investors, subject to applicable legislation.

That provides a useful foundation, but choosing a structure still requires looking at the individual business.

Which Type of Company Should You Establish?

The Turkish Commercial Code recognizes several forms of company. For many ordinary commercial ventures, however, the discussion usually centers on two structures:

• Limited liability company (limited şirket)

• Joint stock company (anonim şirket)

The Turkish Investment Office identifies these as the two most commonly used corporate forms in Türkiye.

The question is not simply which one can be registered. The better question is which structure fits the ownership, financing and future plans of the business.

Limited Liability Company

A limited liability company is frequently considered by founders establishing privately held businesses.

It can make sense where the company is expected to remain relatively closely held and the founders want a corporate structure suited to a small or medium-sized operation.

A limited company may be considered for businesses such as:

• consulting firms;

• technology businesses;

• trading companies;

• professional services businesses;

• family-owned ventures;

• e-commerce businesses; and

• other privately held commercial enterprises.

The minimum capital requirement for newly established limited companies is currently TRY 50,000, following the changes that took effect from 1 January 2024. The Turkish Ministry of Trade provides the relevant official information on its corporate capital requirements.

The statutory minimum, however, should not automatically become the company's financial plan.

A business requiring employees, office space, technology, inventory or substantial working capital may need considerably more funding.

Joint Stock Company

A joint stock company can be relevant where the founders anticipate a more investment-oriented structure, multiple investors or future corporate development.

It can be particularly relevant when considerations include:

• attracting investors;

• issuing or transferring shares;

• larger capital requirements;

• institutional investment;

• sophisticated corporate governance; or

• a business model intended to grow substantially.

The current minimum capital for a newly established 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. These figures should be checked against the legislation applicable at the time of incorporation.

A higher capital threshold does not, by itself, make a joint stock company more suitable. The choice should follow the commercial structure rather than the other way around.

Other Forms of Business Organization

Turkish law also provides for other forms, including:

• general partnerships;

• limited partnerships;

• partnerships limited by shares; and

• cooperatives under the relevant legislation.

The Turkish Investment Office's business establishment information provides an official overview of the available structures.

For many international and privately owned commercial ventures, however, the practical analysis will usually focus first on a limited liability company or joint stock company.

Can a Foreigner Establish a Company in Istanbul?

Yes. International investors can establish companies in Türkiye, subject to the applicable laws and any special rules governing particular sectors.

Türkiye's official Investment Office states that its Foreign Direct Investment Law is based on equal treatment and that international investors may establish company forms recognized under the Turkish Commercial Code.

This is important because foreign founders sometimes assume that they must first find a Turkish partner.

That is not a general requirement simply because the founder is a foreign national.

The actual legal position can depend on the proposed activity, sector-specific legislation and the structure being considered.

For a foreign entrepreneur, the more useful question is therefore not simply:

“Can I own a Turkish company?”

It is:

“What is the right structure for my business, ownership, management and plans in Türkiye?”

What Does a Foreign Founder Need to Prepare?

Foreign shareholders usually need to plan their documentation carefully.

For an individual foreign shareholder, documents can include:

• passport documentation;

• Turkish translations;

• notarized documents;

• tax identification information;

• signature documentation;

• powers of attorney where applicable; and

• documents required for registration.

Where the shareholder is itself a foreign company, the documentation can be more extensive.

It may include:

• certificate of activity or equivalent corporate record;

• evidence of the company's current status;

• information concerning authorized signatories;

• shareholder or board resolutions approving the investment;

• documents concerning a corporate director where applicable; and

• a power of attorney if the incorporation is handled through a representative.

The official Invest in Türkiye company establishment procedure specifically addresses documentation for foreign individual and corporate shareholders.

Foreign Documents: Apostille, Legalization and Translation

This is one area where a little preparation can save a lot of time.

Documents issued outside Türkiye may need to be notarized and apostilled or authenticated through the relevant Turkish consulate, depending on the country and document involved.

The official documents may then need to be translated into Turkish and notarized in Türkiye.

The official Investment Office guidance explains the authentication, apostille and Turkish translation requirements for foreign documents used in the establishment process.

For this reason, foreign founders should avoid assuming that a document that is perfectly valid in their home country can simply be handed to a Turkish authority without further formalities.

Can the Founder Use a Power of Attorney?

In appropriate circumstances, yes.

A founder who cannot attend every stage personally may authorize a representative to handle specified incorporation procedures.

The power of attorney needs to be prepared carefully. Its wording should correspond with the authority that the representative actually needs.

The official company establishment guidance specifically recognizes powers of attorney for representatives handling procedures before the Trade Registry and other authorities.

Understanding MERSİS

Anyone planning to establish a Turkish company will encounter MERSİS.

MERSİS — the Central Registry Record System — is the electronic system used for commercial registry processes and the storage of commercial registry information.

The incorporation information and articles of association are submitted through the system as part of the company establishment process.

The Republic of Türkiye Ministry of Trade provides official information about MERSİS and its role in commercial registry transactions.

The practical lesson for founders is simple: the information entered into the system should be consistent with the company's incorporation documents and intended activities.

The Main Steps in Setting Up a Company

Although the exact process varies according to the company and circumstances, the journey generally follows a recognizable sequence.

1. Decide What the Company Will Do

Before choosing the company type, define the intended activities.

This sounds obvious, but it matters.

A technology company, construction business, financial services provider and import-export business can face very different legal requirements.

2. Decide Who Will Own the Company

The ownership structure should be settled before incorporation.

Consider:

• number of shareholders;

• percentage ownership;

• capital contributions;

• voting arrangements;

• management rights; and

• future investment.

If two or more people are founding the business, it is worth discussing what happens if their interests later diverge.

3. Choose the Corporate Form

At this stage, the founders can compare a limited liability company and joint stock company, together with any alternative structure that may be relevant.

The decision should take account of future plans rather than only the initial registration cost.

4. Select the Company Name

The proposed name must be checked against the applicable registration requirements.

It is also sensible to consider trademarks and branding separately.

A company name being available for registration does not necessarily mean that the corresponding trademark is available.

Trademark searches and registration can be considered through the Turkish Patent and Trademark Office (TÜRKPATENT).

5. Determine the Registered Address

The company needs a registered address.

For a business based in Istanbul, this could be a conventional office or another arrangement permitted under the relevant rules.

The proposed address should also make sense for the company's actual business activities.

6. Prepare the Articles of Association

The articles of association form the legal foundation of the company.

They cover matters such as:

• company name;

• registered office;

• purpose and activities;

• capital;

• shares;

• management;

• representation; and

• other legally required provisions.

This document should not be treated as just another registration form.

It can influence how the company operates after incorporation.

7. Complete the MERSİS Process

The relevant incorporation information and documentation are entered through MERSİS.

The official MERSİS information published by the Ministry of Trade explains its role in commercial registry procedures.

8. Complete Notarial and Signature Formalities

Depending on the circumstances, incorporation documents and signatures may need to be certified.

Foreign documents may require additional authentication and translation.

9. Apply to the Trade Registry

The incorporation application is submitted to the competent Trade Registry Directorate.

The official Investment Office describes Turkish Trade Registry Directorates as one-stop locations for company establishment.

10. Complete Post-Registration Matters

Once the company is registered, the work does not stop.

The company may then need to deal with:

• tax registration;

• Social Security;

• accounting;

• corporate books;

• signature circulars;

• banking;

• employees;

• licenses;

• regulatory notifications; and

• ongoing corporate compliance.

The official Investment Office explains that the Trade Registry Directorate notifies the relevant tax authority and Social Security Institution following incorporation.

How Much Capital Does a New Company Need?

There are two different questions here.

What is the statutory minimum capital?

And:

How much money does this particular business actually need?

They are not the same.

Suppose a founder establishes a company with the statutory minimum but immediately needs to pay rent, salaries, software subscriptions, professional fees, equipment, marketing expenses and supplier invoices.

The minimum statutory capital may have little relationship to the company's real cash requirements.

A sensible incorporation plan therefore considers:

• startup costs;

• working capital;

• expected revenue;

• employees;

• premises;

• equipment;

• inventory;

• taxes;

• professional fees; and

• the time required for the business to reach sustainable revenue.

Who Will Manage the Company?

Ownership and management are not necessarily the same thing.

A foreign shareholder might own the company while day-to-day management is handled by a manager or director in Türkiye.

That makes the company's representation structure particularly important.

Founders should understand:

• who can sign contracts;

• who can operate company bank accounts;

• who can represent the company before authorities;

• whether signatures must be individual or joint;

• whether powers of attorney will be used; and

• how management decisions will be documented.

These details may seem administrative at the beginning. They can become very important when the company starts entering significant contracts.

Do You Need a Shareholders' Agreement?

Not every company needs the same contractual arrangements.

Where there are multiple shareholders, however, a shareholders' agreement may be worth considering.

It can address issues such as:

• transfer of shares;

• future investment;

• voting;

• management;

• confidentiality;

• intellectual property;

• dividend expectations;

• exit arrangements;

• deadlock;

• dispute resolution; and

• restrictions on certain transactions.

The articles of association and a shareholders' agreement serve different functions. They should therefore be considered together rather than treated as interchangeable documents.

What If the Business Later Needs an Investor?

This is worth thinking about before the company is incorporated.

A founder who expects future investment may want to consider:

• how new shares could be issued;

• dilution;

• investor rights;

• management representation;

• reserved matters;

• transfer restrictions; and

• future financing.

A structure that works perfectly for one founder may need substantial adjustment once several investors become involved.

Planning for that possibility does not mean the founder needs to prepare for every imaginable future event. It simply means avoiding unnecessary structural obstacles.

Company Formation and Tax in Türkiye

Incorporation and taxation are closely connected, but they are not the same legal question.

A company may have tax obligations involving:

• corporate tax;

• VAT;

• withholding;

• payroll;

• invoicing;

• accounting records;

• cross-border transactions; and

• other applicable taxes.

The Turkish Revenue Administration (Gelir İdaresi Başkanlığı) is the principal official source for Turkish tax administration.

The government's official Tax Guide for investors also provides information concerning Turkish taxation and international investment.

Tax treatment can depend heavily on the business model and the circumstances of the shareholders, so foreign founders should consider tax advice alongside corporate structuring.

Opening a Bank Account

A newly established company will generally need appropriate banking arrangements for its operations.

Banks may request corporate and identification documentation as part of their account-opening and compliance procedures.

Foreign shareholders should be prepared for questions concerning:

• identity;

• company ownership;

• business activity;

• expected transactions;

• source of funds; and

• corporate documentation.

Banking is not simply a final administrative step. If the business depends on receiving international payments or transferring funds across borders, banking requirements should be considered early.

Does Establishing a Company Give a Foreigner the Right to Work in Türkiye?

Not automatically.

This distinction is important.

A person may be a shareholder of a Turkish company without that fact alone answering whether they can work in Türkiye.

If a foreign shareholder intends to work actively for the company, the relevant immigration and work permit rules should be reviewed.

The official Invest in Türkiye work permit information provides information concerning work authorization for foreign nationals.

Residence rights and work rights should likewise be considered separately.

The Directorate General of Migration Management is the official Turkish authority for immigration and residence matters.

What About Employees?

Once the company begins hiring, employment law becomes part of its everyday operations.

This can involve:

• employment agreements;

• salaries;

• Social Security;

• working hours;

• annual leave;

• termination;

• workplace health and safety;

• employee records; and

• protection of employee personal data.

The Social Security Institution (SGK) provides official information on Turkish Social Security procedures.

Employment planning is particularly important for companies that expect to hire quickly after incorporation.

Can a Turkish Company Employ Foreign Nationals?

It can, subject to the applicable work permit framework.

The company's status, the employee's nationality, position, qualifications and other circumstances can affect the applicable procedure.

A foreign entrepreneur who plans to establish a company and then work in that company should therefore consider corporate, immigration and employment questions together.

Does Every Business Need a License?

No.

But some businesses do.

This is one of the most important checks to make before incorporation.

Depending on the proposed activity, additional rules may apply to sectors such as:

• financial services;

• insurance;

• payment services;

• healthcare;

• pharmaceuticals;

• telecommunications;

• transportation;

• aviation;

• maritime activities;

• education;

• energy;

• tourism;

• food;

• employment services; and

• other regulated activities.

Company registration does not automatically give a business permission to carry out every activity stated in its commercial plans.

The relevant regulator and sector-specific legislation should be identified before the business begins operating.

Data Protection Should Be Considered From the Beginning

A new company can begin processing personal data almost immediately.

A website may collect enquiries.

An employer will hold employee information.

An online business may collect customer information.

A consultancy may store client identification and contact details.

Türkiye's Personal Data Protection Authority (KVKK) administers the framework under Law No. 6698 on the Protection of Personal Data.

For businesses that process significant quantities of personal data, privacy and data governance should be built into the business model rather than added later.

Intellectual Property: Who Owns What?

For many modern businesses, intellectual property is more valuable than physical equipment.

Think about:

• software;

• trademarks;

• logos;

• websites;

• designs;

• inventions;

• databases;

• technical know-how; and

• proprietary business materials.

If a founder created software before the company existed, for example, the company does not necessarily become the owner simply because the founder later incorporates a Turkish company.

Ownership and licensing arrangements should be documented properly.

The Turkish Patent and Trademark Office provides official information concerning industrial property rights, including trademarks, patents and designs.

What If a Foreign Company Wants to Enter the Turkish Market?

Establishing a new Turkish company is not the only possible route.

Depending on the commercial objective, a foreign business may consider:

• a Turkish subsidiary;

• a branch office; or

• a liaison office where permitted.

These structures are not interchangeable.

Subsidiary

A Turkish subsidiary is a separate Turkish legal entity established under Turkish law.

It can conduct commercial activities within the scope permitted by its structure and applicable regulations.

Branch

A branch is not a separate legal person from its foreign parent.

The official Invest in Türkiye guidance explains that a branch has no shareholders and no separate legal personality from the parent company.

Liaison Office

A liaison office has a different purpose.

A foreign company may establish a liaison office in Türkiye subject to the relevant permission, but it cannot engage in commercial activities.

This distinction is important.

A business that wants to sell products, enter commercial contracts or generate revenue in Türkiye should not assume that a liaison office can perform the same role as an operating Turkish company.

The official Investment Office provides specific information concerning liaison offices in Türkiye.

What About Joint Ventures?

A joint venture may be structured in different ways depending on the commercial relationship.

Where two businesses intend to work together in Türkiye, the parties should decide whether they need:

• a jointly owned Turkish company;

• a contractual joint venture;

• a project-specific arrangement; or

• another structure.

The relationship between the parties should be documented carefully.

Questions about investment, management, intellectual property, funding, profit distribution, exit and dispute resolution can become important long before the business becomes profitable.

Company Formation and Real Estate in Türkiye

Some businesses establish Turkish companies because their operations involve property.

This could include:

• offices;

• warehouses;

• factories;

• commercial premises;

• development projects; or

• other business-related real estate.

Where foreign capital is involved, property acquisition can raise additional legal questions.

The Turkish Investment Office provides official information concerning property acquisition by foreign investors and companies.

The company's articles of association, ownership structure, proposed property and applicable restrictions should be reviewed before entering into a significant acquisition.

Common Problems That Can Be Avoided

The incorporation process itself is usually not the hardest part.

Problems often arise because important questions were never considered before registration.

Choosing the Structure Only Because It Is Cheap

The cheapest structure at incorporation may not be the structure that works best after the company grows.

Copying Generic Articles of Association

A template can cover basic registration requirements without reflecting the founders' actual relationship.

Delaying Foreign Documentation

Apostilles, legalization, translations and notarization can take time.

Starting the process early is usually much easier than trying to solve document problems at the registration stage.

Confusing Ownership With Work Authorization

Owning shares does not automatically settle a foreign shareholder's right to work in Türkiye.

Ignoring Licensing

A company can be successfully registered while its intended activity remains subject to a separate license or approval.

Treating Minimum Capital as the Business Budget

The statutory minimum and the money needed to operate the company are two different things.

Forgetting About the First Year

Founders sometimes focus entirely on registration and forget what happens immediately afterwards.

Accounting, tax, employees, contracts, data protection and corporate governance can all become relevant very quickly.

A Practical Pre-Incorporation Checklist

Before filing the incorporation application, founders can work through the following questions:

Corporate Structure

• What company form is appropriate?

• Who are the shareholders?

• What percentage will each shareholder hold?

• What capital will each shareholder contribute?

Management

• Who will manage the company?

• Who can sign?

• Will signing authority be individual or joint?

• Will anyone act under a power of attorney?

Business Activity

• What exactly will the company do?

• Are any activities regulated?

• Are licenses or approvals required?

Foreign Shareholders

• Are foreign documents ready?

• Do they require apostille or legalization?

• Have Turkish translations been arranged?

• Is a tax identification number required?

Operations

• Where will the company operate?

• What premises will it use?

• Will employees be hired?

• Will foreign employees be involved?

Contracts and Assets

• Who owns the intellectual property?

• What customer and supplier contracts are needed?

• Are shareholder arrangements required?

• Will the company acquire property?

Compliance

• Who will handle accounting?

• What tax obligations will apply?

• What data will the company process?

• What corporate records must be maintained?

These questions may take less time to answer than correcting a poorly planned structure later.

How Kurucuk & Associates Assists With Company Formation

At Kurucuk & Associates, we approach incorporation as part of the wider legal life of a business.

For Turkish founders and international investors, our assistance may cover:

Corporate Structuring

Reviewing the proposed ownership and business model and considering an appropriate Turkish company structure.

Incorporation Documentation

Preparing or reviewing articles of association, shareholder documents, resolutions, powers of attorney and other incorporation materials.

Foreign Investor Documentation

Assisting with foreign shareholder documentation, authentication, apostille, Turkish translation and related formalities.

MERSİS and Trade Registry

Providing legal support with the incorporation process and coordination of the required corporate documentation.

Shareholder Arrangements

Advising founders on shareholder relationships, management rights, transfer arrangements and other corporate governance matters.

Commercial Agreements

Helping newly established companies with contracts involving customers, suppliers, partners and other commercial counterparties.

Regulatory Issues

Identifying potential licensing and regulatory questions connected with the proposed business activity.

Foreign Personnel

Providing legal assistance concerning issues that may arise when a company intends to employ foreign nationals in Türkiye.

Ongoing Corporate Matters

Assisting companies after incorporation with corporate, commercial and related legal matters as their business develops.

Frequently Asked Questions

Can a foreigner establish a company in Istanbul without a Turkish partner?

Generally, international investors can establish companies under the Turkish Commercial Code without a general requirement to have a Turkish partner. Specific sectors may have their own rules, so the proposed activity should always be checked.

What is the minimum capital for a limited company in Türkiye?

The current minimum capital for a newly established limited liability company is TRY 50,000. The applicable capital rules should be confirmed at the time of incorporation because legislation can change.

What is the minimum capital for a joint stock company?

The current minimum capital for a newly established joint stock company is TRY 250,000. A non-public joint stock company using the registered capital system has a minimum initial capital of TRY 500,000 under the current rules.

Can I establish the company while I am outside Türkiye?

In suitable circumstances, incorporation procedures can be handled through an authorized representative using a properly prepared power of attorney. The precise documentation depends on the shareholders and the proposed structure.

Do foreign documents need an apostille?

Foreign documents may need to be apostilled or authenticated through the relevant Turkish consulate, depending on the document and country concerned. They may also require official Turkish translation and notarization.

How long does company registration take?

The official Investment Office states that company establishment is carried out through Trade Registry Directorates designed as one-stop shops and that the process can be completed within the same day when the required conditions are met. The practical timeframe for an individual founder can nevertheless depend on document preparation, foreign documents, translations and other requirements.

Can a foreign shareholder work for the Turkish company?

Being a shareholder and having permission to work are separate matters. A foreign shareholder intending to work in Türkiye should review the applicable work permit rules.

Can a company established in Istanbul operate throughout Türkiye?

A Turkish company is not generally restricted to conducting business only within Istanbul simply because its registered office is there. The actual scope of its activities remains subject to its corporate purpose and any sector-specific legal requirements.

Do I need a lawyer to establish a company in Türkiye?

There is an administrative procedure for incorporation, but legal assistance can be particularly useful where there are foreign shareholders, multiple founders, regulated activities, complex management arrangements, international transactions or significant intellectual property.

Is company formation the same as getting a residence permit?

No. Company formation, residence rights and work authorization are separate legal matters. Each has its own requirements and should be assessed independently.

Can a foreign company open a branch in Türkiye?

Yes, subject to the applicable requirements. A branch is different from a Turkish subsidiary because it does not have a separate legal personality from its foreign parent.

Can a foreign company establish a liaison office?

Yes, subject to the relevant permission, but a liaison office cannot engage in commercial activities in Türkiye.

The First Decision Is Not Registration — It Is Structure

For most founders, the Trade Registry application is only one moment in a much longer business journey.

The decisions made beforehand can influence who controls the company, how investors participate, how contracts are signed, how intellectual property is held and how easily the business can adapt when circumstances change.

For foreign entrepreneurs, there is an additional practical challenge: the Turkish corporate system may be unfamiliar, while documents issued in another country may need to go through authentication and translation procedures before they can be used.

A well-prepared incorporation process therefore starts with understanding the business rather than filling in forms.

Kurucuk & Associates advises entrepreneurs, shareholders and international investors on company formation and related corporate and commercial matters in Istanbul and throughout Türkiye.

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