Turkish Limited Sirket (LS) Company Formation
A Turkish Limited Sirket (LS) is equivalent to a Limited Liability Company in the UK or a GmbH in Austria and Germany in that it is a legal entity which is separate and distinct from the individuals who run it. For sole traders and for people in partnerships, the individuals’ personal assets are at risk if there is a claim against the organisation but shareholders in a LS are liable to lose only the value of the share capital to which they subscribe.
Over recent years the Turkish government has simplified the procedures required to incorporate a company for both foreign and domestic investors.
The company name must be derived from the primary business activities of the company and it can be in any language so long as the Registry approves that the Turkish translation is acceptable; certain words are prohibited. We run a company name check on the proposed company name to ensure it is suitable and can often get approval within a few hours, once approved the name can be reserved free of charge for ten days.
All companies registered in Turkey must have a registered office in Turkey where all company documents and correspondence may be sent. A registered office is included as part of our incorporation service.
At least one director is required to incorporate and there is no restriction on nationality or residency.
Only one shareholder is required and there is no restriction on nationality or residency; corporate shareholders are permitted. If the shareholder is an individual we will require a copy of their passport and if a corporate entity we will require a Certificate of Good Standing for that company and the directors’ signature.
The minimum share capital is YTL 5,000 (approximately EUR 1,730) with each individual share being worth no less than YTL 25 (approximately EUR 8.70). Upon incorporation at least 25% of total share capital must be paid up in cash and any outstanding capital must be paid within three years.
Companies are required to maintain accounts written in the Turkish language and detailed in Turkish Liras. For non-listed companies there is no requirement to file annual financial statements or have accounts audited. All companies must file an annual return and pay the annual government license fee to stay registered.
Once all documentation has been received the incorporation process typically takes 10 days.
Proof of Identity
As part of our due diligence we require proof of identity in the form of a passport copy for all directors and shareholders of the company.
It is a mandatory requirement that all officers travel to Turkey in order to sign the incorporation documents.