Do I need a Local Company Director in Turkey ?

As referenced to other countries, many clients ask this question. Because, in majority of the countries around the world this is a must. However, in Turkey the director does not need to be Turkish. Therefore, sometimes the clients surprise when they ask the question Do I need a Local Company Director in Turkey?  The answer of this question is quite simple “no”. However, to avoid any misunderstanding we prefer answer in detail. Since, company directors have extensive authority. On the other hand, not all clients will live in Turkey.

What is a Company Director in Turkey?

Many entrepreneurs around the world ask for company formation in Turkey.  Also, the above question has importance as well.

Directors manage the limited liability companies. Directors can be one person or more than person. However, at least one shareholder should have the authority to manage and represent the company. Additionally, a legal entity can be a director of the company.  If a legal entity is chosen as a director, the legal person shall designate a real person who will perform this duty on behalf of the legal person.

The companies define their directors on the government portal.

What are the powers of the Company Directors in Turkey?

Directors have authority to take decisions and execute them on all matters. However, the subjects left to general assembly by law and article of association are exceptions. Additionally, the directors will manage the company at the top level. They establish the early detection and management of risks committee for limited companies in Turkey.

Do I need a Local Company Director in Turkey ?

No, a foreigner can be the director of a company in Turkey. However, at least one shareholder must have director’s right. Therefore, some of the entrepreneurs do not wish to relocate in Turkey appoint Turkish director. In that situation, regardless of how big it is, the director must have some shares on the company.

How a Director can loose the title in Turkey ?

The title of director in the event of the following situations

is lost;

• If the term of title is defined in advance with the expiration of this period,
• With the dismissal decision of the general assembly,
• By court decision,
• By resignation,
• In cases such as death, restraint and bankruptcy,
• The loss of the qualifications stipulated for the manager in the articles of association

How a Legal Entity Can be a Company Director in Turkey ?

Unlike the old commercial code, the new commercial code of Turkey defines this option. The new commercial code clearly says it is possible.

If one of the directors is a legal entity, such legal entity should determine a real person for the representation.

Numerous foreigners entrepreneurs prefer this option for company formation in Turkey. Since they wish the keep their shareholding structure in the investor company. However, in this option the investor legal entity shall define this through board decision.

The sample board of resolutions can be as follows.

DECISION NO:

DECISION DATE : ………../………./………..

MEETING PARTICIPANTS: ………………………… ..

 

SUBJECT: Decision on representation and binding

The Company Board of Shareholders convened at the Company Headquarters and took the following decisions.

1)………………… (Name of the shareholder company) is selected as the company directorate for the Limited Liability Company to be established in the Republic of Turkey with the name of ………………………… (name of the planned company in Turkey)

2) It was decided  that, ……………………………..( Name of the foreigner shareholder company) assigned to the company diretorate, represent and bind the company with the individual signature in the widest sense until the decision was taken for the otherwise.

3) ……………..(name of the representative of a legal entity)  with the ……………Passport Number ……………….

(address）will represent the ………………………(Name of the shareholder company)