Either real persons or legal entities can be a shareholder for the companies in Turkey. Even though the first alternative is common we receive numerous applications for the second alternative as well. In this case we receive the question Can My Company be A Shareholder for a Company in Turkey? The answer is yes however the required documents for this option is different compared to real persons shareholder. In this Article we will analyse the process of legal entity shareholder company formation in Turkey.
Company Formation in Turkey by a Legal Entity
While the old law in effect the conditions for company formation in Turkey by a foreigner legal entity was very difficult. However, after the new law published the foreigner investors and local investors of Turkey became equal in terms of company formation in Turkey. Additionally, with the new law it is the foreigner directors of the company do not require to have a work permit in Turley.
The Process of Company Formation in Turkey by Foreigner Legal Entity
(a) Reservation of the commercial title in Turkey: The company formation in Turkey process is started through a system named Mersis. As the first step the commercial title of the planned company in Turkey to be determined.
(b) Acquisition of Potential Tax Number: The foreigner company which will be the sole shareholder of the company to be registered in Turkey shall obtain a potential tax number from Turkish Tax Authority.
The Required Documents for Company Formation in Turkey By Legal Entity
(a) Certificate of Activity: This is a document which shows that the investor company is legitimately registered, also the company is still active.
(b) Power of Attorney: If the company formation in Turkey process is followed by an accountant or lawyer the investor company should grant a power of attorney to the accountant or lawyer. The crucial point at this step is that the power of attorney should be given from the legal entity not a real person. Let us explain this with an example;
Mr. Moustafa is a shareholder of a company Dubai named Moustafa Software LLC. He wishes to register a company in Turkey. Mr Moustafa wishes that his company in Dubai will be the shareholder of the company in Turkey. In this case not Mr Moustafa as real person, Moustafa Software LLC as a legal entity should give the power of attorney.
( c) Board of Resolution: The investor company should take a board of resolution. In this decision two items should be explicitly specified
- The investor company will be a shareholder to a company in Turkey
- A real person should be determined to be representative of the company to be registered in Turkey.
(d) Passport copy of the assigned board member for the formation of company in Turkey
The important point in this process is that, the documents of the real person shareholders are can be generated in Turkey. However, if the shareholder of the company to be established in Turkey is a legal entity the corporate documents at first should be attested by Turkish Consulate at the country of the investor company.
Briefly for the questions of Can My Company be A Shareholder for a Company in Turkey? The answer is yes. There is no difference between Turkish Companies and Foreigner Companies in terms of being shareholder. However, the documents are quite crucial during this process. For further information please consult us.