Türkiye has become one of the most attractive destinations for international companies looking to expand their business operations. Strategically positioned at the crossroads of Europe, Asia, and the Middle East, Türkiye offers businesses access to a market of over 85 million people domestically and a broader regional market of nearly one billion consumers. Its strong infrastructure, young and dynamic workforce, and integration into global supply chains make it a preferred location for companies seeking growth.

For foreign investors, however, expanding into Türkiye requires more than just business acumen. It demands a clear understanding of the local legal, financial, and regulatory framework. From choosing the right company structure and preparing bilingual Articles of Association to handling tax registrations, banking arrangements, and employment matters, businesses must take deliberate steps to ensure full compliance and smooth operations.

This article provides a practical roadmap for international companies planning to establish a presence in Türkiye. It highlights the key incorporation requirements, legal obligations, and ongoing compliance issues that businesses must address. It also explains how working with experienced local advisors can make the process faster, safer, and more cost-effective.

Company Incorporation & Registrations

Choosing the Right Entity

The first step for any foreign business expanding to Türkiye is deciding on the most suitable legal entity. In practice, the Limited Liability Company (Limited Şirket, Ltd. Şti.) is the most common and efficient form for international investors. It requires only one shareholder, who may be a foreign individual or legal entity, and one director. The liability of shareholders is limited to their share capital, making it a safe and flexible option for small and medium-sized enterprises.

For larger-scale ventures or companies planning a future public offering, the Joint Stock Company (Anonim Şirket, A.Ş.) may be considered. While it involves more formalities, it provides advantages in terms of corporate governance and attracting investors.

Drafting the Articles of Association

Every Turkish company must have an Articles of Association (AoA) prepared in line with the Turkish Commercial Code. For foreign businesses, drafting the AoA in both Turkish and English is essential for transparency and internal use. The AoA outlines the company’s purpose, shareholding structure, capital, management, and operational rules.

Tailoring the AoA to the specific needs of the business – such as including clauses on shareholder rights, dispute resolution, or sector-specific requirements – is crucial for avoiding conflicts and ensuring flexibility in future operations.

Trade Registry and Related Filings

After preparing the AoA, the next step is registration with the Turkish Trade Registry. This process officially establishes the company as a legal entity. Key filings and requirements include:

• Submission of incorporation documents (AoA, shareholder and director details, notarized signatures).
• Obtaining a tax identification number for the company and its foreign shareholders (if applicable).
• Registration with the Social Security Institution (SGK) for employer obligations.
• Filing with the local tax office to activate corporate tax responsibilities.

The registration process usually takes a few days if documentation is complete and properly prepared. Once finalized, the company is legally recognized and can commence operations in Türkiye.

Banking & Financial Setup

Once a company is incorporated in Türkiye, the next essential step is establishing a banking relationship. A corporate bank account is required not only for day-to-day operations but also for compliance with tax and payroll obligations.

Opening a Turkish Lira (TRY) Account

Every incorporated company must open a Turkish Lira (TRY) account with a local bank. This account is used to deposit share capital, process employee salaries, and make tax payments. Foreign shareholders and directors are typically required to provide notarized passports, proof of address, and in some cases, tax identification numbers.

The procedure can be time-consuming for companies unfamiliar with Turkish bureaucracy. Having a local advisor liaise with banks on behalf of the company significantly speeds up the process and ensures smooth communication.

Banking Requirements for Foreign Investors

Turkish banks generally require the following documents for account opening:

• Company’s incorporation documents (Trade Registry Gazette, Articles of Association).
• Signature circular of the authorized representatives.
• Identification documents of shareholders and directors.
• Tax identification numbers of the company and its foreign shareholders (if applicable).

Some banks may request additional documents such as a business plan, references, or proof of the company’s international presence.

Importance of Local Banking Setup

Establishing a strong banking relationship is critical for foreign companies in Türkiye. It allows smooth handling of:

• Payroll payments to employees.
• Tax and social security contributions.
• Foreign currency transactions, including EUR, USD, and GBP accounts when required.
• Cross-border trade facilitation, such as letters of credit and international transfers.

Without a proper banking setup, companies risk delays in operations and compliance. Partnering with local experts ensures that the bank account is opened efficiently, avoiding unnecessary obstacles.

Employment & Payroll

Hiring employees in Türkiye requires compliance with Turkish Labor Law, which is protective of employees and places significant obligations on employers. For international companies, it is crucial to establish proper employment documentation and payroll systems from the outset.

Employment Contracts

All employees in Türkiye must be engaged under a written contract. For foreign businesses, it is highly recommended to prepare bilingual employment contracts (Turkish–English) to ensure both parties fully understand their rights and obligations.

Key elements of employment contracts include:

• Job description and responsibilities.
• Duration of employment (fixed-term or indefinite).
• Salary, benefits, and payment terms.
• Working hours, overtime provisions, and annual leave.
• Termination procedures and notice periods.
• Confidentiality, data protection, and non-compete clauses where appropriate.

Having a contract tailored to Turkish law while reflecting the company’s policies is essential for avoiding disputes and ensuring compliance.

Payroll & Social Security

Employers in Türkiye must handle payroll in line with local tax and social security regulations. Obligations include:

• Registering each employee with the Social Security Institution (SGK) before the commencement of work.
• Deducting and remitting employee income tax and social security contributions.
• Paying employer’s social security premiums (a significant cost factor for businesses).
• Submitting monthly payroll reports to the authorities.

Failure to comply with payroll and reporting requirements can result in fines, back payments, and reputational risks for the company.

Ongoing Employment Compliance

Beyond contracts and payroll, employers must also comply with:

• Workplace health and safety regulations.
• Data protection obligations (KVKK and, where applicable, GDPR).
• Non-discrimination and equal opportunity rules.

For international businesses, outsourcing payroll management and HR compliance to local professionals often provides the most cost-effective and risk-free solution.

Legal & Regulatory Compliance

Expanding into Türkiye requires more than setting up a company and hiring staff. International businesses must also navigate a range of legal and regulatory obligations to ensure their operations remain compliant and risk-free.

Business Licenses and Sector-Specific Permits

While a general company license allows many businesses to operate, certain industries are subject to special regulatory regimes. Examples include:

• Finance and banking – requiring permits from the Banking Regulation and Supervision Agency (BDDK).
• Energy and utilities – regulated by the Energy Market Regulatory Authority (EPDK).
• Healthcare and pharmaceuticals – requiring approvals from the Ministry of Health.
• Import/export activities – subject to customs rules and trade regulations.

Failure to obtain the relevant licenses may result in fines, suspension of activities, or criminal liability.

Data Protection & Privacy (KVKK and GDPR)

Foreign companies collecting or processing personal data in Türkiye must comply with the Turkish Personal Data Protection Law (KVKK). This law is largely aligned with the EU’s General Data Protection Regulation (GDPR), but also includes local requirements such as mandatory registration with the Data Controllers’ Registry (VERBİS).

Key compliance steps include:

• Drafting privacy notices and data processing agreements.
• Implementing technical and organizational data security measures.
• Ensuring cross-border data transfers comply with Turkish and EU standards.

Employment Law Compliance

Beyond drafting contracts and payroll, employers must follow ongoing obligations, such as:

• Preparing workplace regulations for companies with more than 30 employees.
• Ensuring compliance with occupational health and safety standards.
• Managing employee terminations in line with Turkish labor law.

Corporate Governance & Reporting

Turkish companies must also fulfill continuing obligations to remain in good standing. These include:

• Holding annual general assemblies (for Joint Stock Companies).
• Keeping updated share ledgers and company records.
• Filing annual financial statements and tax declarations.
• Notifying the Trade Registry of changes to directors, shareholders, or the Articles of Association.

Maintaining compliance avoids penalties, protects the company’s reputation, and ensures smooth business operations in Türkiye.

Additional Practical Support

Expanding into Türkiye is not only a legal process but also a practical and administrative exercise. International businesses often face challenges in dealing with local institutions, documentation requirements, and bureaucratic procedures. Having local support ensures these matters are handled efficiently and in compliance with Turkish law.

Liaison with Government Offices and Notaries

Many steps in the incorporation and registration process require interaction with notaries, trade registries, and public offices. This includes notarization of documents, approval of signature circulars, and certified translations. Engaging local advisors who can represent the company before these authorities saves time and minimizes errors.

Translation and Notarization of Documents

Foreign documents such as passports, powers of attorney, and corporate resolutions must often be translated into Turkish and notarized before being accepted by Turkish authorities. Certified translations and notarized copies are crucial for ensuring the validity of filings and preventing delays.

Power of Attorney (POA) Arrangements

Foreign shareholders or directors who cannot be physically present in Türkiye can authorize local representatives to act on their behalf through a power of attorney (POA). This allows all incorporation and registration procedures to be completed smoothly without requiring frequent travel to Türkiye.

Practical Business Support

Beyond legal compliance, foreign companies may also require assistance with:

• Office leasing and commercial contracts.
• Bank negotiations and relationship management.
• Visa and residence permit applications for foreign managers and staff.
• Networking and business development support to connect with local partners.

These practical services are often just as important as legal structuring in ensuring a company’s successful entry into the Turkish market.

Why Work With a Local Law Firm?

While Türkiye offers immense opportunities for foreign investors, the country’s legal and regulatory framework can be complex and unfamiliar to international businesses. Having a trusted local partner is therefore critical for a smooth and compliant market entry.

Expertise in Turkish Law and Practice

A local law firm ensures that your incorporation documents, contracts, and registrations meet the requirements of the Turkish Commercial Code, Labor Law, Tax Law, and sector-specific regulations. This prevents costly mistakes and ensures the company is established on a strong legal foundation.

Tailored Advice for International Clients

Every foreign investor has different goals, structures, and expectations. A local firm can provide customized guidance on the most suitable entity type, tax implications, employment strategies, and governance models. For example, while a Limited Liability Company may be suitable for smaller operations, a Joint Stock Company may be a better fit for large-scale or investment-oriented businesses.

Bridging Language and Cultural Barriers

Legal and business processes in Türkiye are conducted primarily in Turkish. By working with bilingual lawyers who understand both local practices and international business standards, foreign investors eliminate the risks of miscommunication and cultural misunderstandings.

End-to-End Support

A reputable local law firm does more than register a company. It offers full-cycle services — from incorporation to banking support, from employment law compliance to dispute resolution. This ensures that international businesses have a single point of contact for all their legal and practical needs in Türkiye.

Your Trusted Partner

At Bıçak Law Firm, we specialize in assisting international clients entering the Turkish market. With our multilingual team, experience in cross-border transactions, and comprehensive service offerings, we guide businesses through every stage of their expansion. Our mission is to help investors establish themselves confidently, compliantly, and successfully in Türkiye.

Conclusion

Türkiye offers foreign investors a unique combination of opportunities: a dynamic domestic market, strategic location, and access to regional and global supply chains. At the same time, entering this market requires navigating a detailed legal and regulatory framework covering company incorporation, banking, employment, taxation, and sector-specific compliance.

For international businesses, a successful expansion depends on more than business strategy alone – it also requires the right legal and practical support. With proper guidance, the process of setting up a company, opening bank accounts, hiring employees, and staying compliant with Turkish regulations can be managed smoothly and efficiently.

At Bıçak Law Firm, we have extensive experience assisting international clients in every step of their Turkish market entry. From drafting bilingual Articles of Association and employment contracts to handling registrations, banking procedures, and ongoing compliance, we provide comprehensive, end-to-end solutions tailored to your needs.

By partnering with trusted local advisors, foreign businesses can establish themselves with confidence, avoid unnecessary risks, and focus on what truly matters: growing their business in Türkiye’s dynamic market.