Law No. 4875 is short and its substance is a single principle: a foreign investor is treated the same as a domestic one. No approval is needed to invest, no special entity type exists for foreign capital, and the company that results is an ordinary Turkish company. What the law adds is not a set of privileges but a set of notification obligations, and those are what companies actually get wrong.
This page covers who falls within the law, the guarantees it provides, the notifications and their deadlines, the sectors where restrictions still apply, and the current capital requirements.
What the Law Guarantees
| Principle | What it means in practice |
|---|---|
| Equal treatment | Foreign investors have the same rights and obligations as domestic investors. There is no separate company type for foreign capital and no separate registration regime |
| Freedom to invest | Direct investment is free unless international agreements or specific legislation provide otherwise. No permission is required from an investment authority |
| No pre-approval | A company may be formed without prior authorisation; formation follows the ordinary commercial procedure |
| Protection against expropriation | Investments may not be expropriated or nationalised except in the public interest, under due process and against compensation |
| Free transfer | Net profits, dividends, proceeds of sale or liquidation, licence and management fees and loan repayments may be transferred abroad through banks |
| Access to real estate | Companies formed under Turkish law may acquire real estate on the same basis as domestic companies, subject to the restrictions in the relevant legislation |
| Dispute resolution | Disputes may be taken to Turkish courts or, where the conditions are met, to national or international arbitration |
| Employment of foreign personnel | Permitted, subject to the ordinary work permit process |
Investors sometimes expect a foreign investment licence, a special company type or a registration with an investment agency. None of these exists. A company with foreign shareholders is registered at the trade registry like any other, taxed like any other and audited like any other.
What the law does create is a reporting relationship with the ministry. Because there is no approval step to prompt it, that obligation is the one most often discovered late — typically when a capital increase or share transfer has already been registered without the notification being made.
Who Falls Within the Law
- Foreign natural persons and legal entities established under the laws of another country
- Turkish citizens resident abroad, where the investment is made in that capacity
- Companies established in Turkey with foreign shareholding, whatever the percentage
- Branches in Turkey of companies established abroad
- Liaison offices are treated separately and may not carry on commercial activity
- Acquiring shares in an existing Turkish company brings that company within the regime
- The obligation attaches to the company, not only to the shareholder
- A single share held by a foreign person is enough to trigger the reporting duty
Notifications and Their Deadlines
This is the operative part of the law for a company already established, and the part omitted from most descriptions of it.
| Notification | Content | Deadline |
|---|---|---|
| Annual activity information | Activity and financial information for the preceding year | By the end of May |
| Share transfers | Transfers between existing shareholders, or to or from a foreign investor | Within 1 month |
| Capital increases and decreases | Changes to the capital structure | Within 1 month |
| Payments into the capital account | Amounts transferred from abroad on account of capital | Within 1 month |
| Branch information | Activity information for branches of foreign companies | By the end of May |
| Liaison office activity report | Reported separately under the liaison office regime | By the end of May |
Notifications are made through the ministry’s electronic system by a user authorised for that company, holding a valid electronic certificate. The authorisation is granted on application with a power of attorney or a board resolution, and it takes time.
Companies that leave this until a notification is due discover that they cannot file at all. Appointing the authorised user at formation, rather than when the first deadline arrives, is the practical answer — and where the authorisation lapses, it has to be renewed before the next filing.
Entity Types and Current Capital Requirements
| Entity | Suits | Minimum capital |
|---|---|---|
| Joint stock company | Larger operations, groups planning an exit or investor entry; shares transfer without a notarial deed | TRY 250,000 |
| Limited liability company | Smaller operations; shares transfer by notarial deed with registration | TRY 50,000 |
| Branch | Extension of the foreign company rather than a separate legal person | No statutory minimum |
| Liaison office | Representation and research only; no commercial activity | Funded from abroad |
The minimum capital for a joint stock company is TRY 250,000 and for a limited liability company TRY 50,000. Material still quoting TRY 50,000 and TRY 10,000 predates the change.
Companies formed before the increase and still below the new minimum must raise their capital by 31 December 2026. A company that does not is treated as dissolved. The increase resolution does not require a quorum for the meeting and is taken by a majority of the votes present.
See: joint stock or limited company and company formation
Where Restrictions Still Apply
Freedom to invest is the rule, but specific legislation limits foreign shareholding or requires authorisation in a number of sectors. These restrictions come from sector laws rather than from Law No. 4875.
- Broadcasting: foreign shareholding in a media service provider is capped, and a foreign investor may hold shares in a limited number of such companies
- Aviation and maritime transport: nationality conditions apply to operating licences and to vessel registration
- Defence and security: production and trade require authorisation from the ministry
- Banking, insurance and capital markets: entry requires authorisation from the sector regulator and shareholding changes are subject to approval
- Energy: licensed activities are subject to the regulator’s own rules
- Mining: licensing and permit requirements apply irrespective of shareholder nationality
- Private security and certain professional services: restrictions apply
- Real estate acquisition by companies: subject to the restrictions in the relevant legislation and, in defined cases, to military authority clearance
Supervising Authorities
| Authority | Role |
|---|---|
| Ministry of Industry and Technology | Administers the incentive and foreign investment notification systems |
| Trade registry offices | Formation, registration of changes and announcement |
| Revenue Administration | Tax registration, returns and audit |
| Social Security Institution | Workplace and employee registration, premium collection |
| Sector regulators | Authorisation and supervision in regulated sectors |
| Central Bank | Foreign exchange legislation and capital movements |
Common Mistakes
- Expecting an investment approval or licence. None exists; formation follows the ordinary commercial procedure.
- Using the pre-2024 capital figures. The minimums are TRY 250,000 and TRY 50,000, not TRY 50,000 and TRY 10,000.
- Missing the 31 December 2026 capital deadline. A company still below the minimum is treated as dissolved.
- Discovering the notification obligation after a share transfer is registered. It is due within one month of the transaction.
- Leaving the authorised user appointment until a deadline arrives. Without it the company cannot file at all.
- Treating the annual report as optional because nothing prompts it. It is due by the end of May whether or not a reminder arrives.
- Assuming sector restrictions come from the investment law. They come from sector legislation and are checked separately.
- Confusing free transfer of profits with an absence of tax. Transfers are free; the withholding on distributions still applies.
Frequently Asked Questions
Does a foreign investor need approval to invest in Turkey?
What are the notification obligations?
What is the minimum capital for a company in Turkey?
Can profits be transferred abroad freely?
Are there sectors closed to foreign investors?
Does a single foreign shareholder bring the company within the regime?
What happens if a notification is missed?
Can a foreign-owned company buy real estate in Turkey?
As the Ozbek CPA team, we handle the compliance side of foreign investment in Turkey — appointing and maintaining the authorised user for the electronic notification system, filing the annual activity report and the notifications for share transfers, capital changes and capital account payments within their deadlines, and reviewing the notification history where a company has fallen behind. See also our pages on company formation, joint stock or limited company, investment incentives and trade registry procedures. Contact us.
