To establish a branch in Turkey as part of the procedures for company formation in Turkey, foreign-based companies need to submit a number of essential documents. These documents are part of a legal procedure that ensures compliance with local regulations for establishing a branch in Turkey.

When Should You Establish a Foreign Branch in Turkey?

If your business seeks a cost-efficient, flexible, and legally compliant way to enter the Turkish market while maintaining strong control, a branch could be the optimal solution. Considering your industry, tax structure, and long-term goals will help determine whether this approach aligns with your expansion strategy.

Expanding into the Turkish market can be a strategic move for foreign companies. Setting up a branch is often the preferred option in several scenarios, offering cost advantages, simplified management, and flexibility. Here’s when establishing a foreign branch in Turkey makes the most sense:

1. Cost-Effective Market Entry

A branch allows companies to enter the Turkish market without the complexities of forming a new legal entity. With lower setup and operational costs, it provides a budget-friendly alternative to a subsidiary.

2. Tax Benefits

Foreign branches in Turkey are only taxed on the income generated within the country. This can create significant tax advantages for businesses that primarily operate outside Turkey.

3. Full Control by the Parent Company

Unlike a subsidiary, a branch remains under the direct management and financial control of the parent company, ensuring consistency in decision-making and operations.

4. Ideal for Short-Term or Project-Based Operations

Sectors such as construction, engineering, and consulting often require a temporary local presence. A branch can be established for a specific project and closed once it is completed, reducing long-term commitments.

5. Simplified Setup and Compliance

Compared to forming a new company, establishing a branch requires fewer legal formalities, reducing paperwork and bureaucratic hurdles. This makes it a faster and more efficient solution for companies looking to operate in Turkey.

6. Enhanced Brand Trust and Market Recognition

A branch benefits from the established reputation, financial stability, and credibility of the parent company. This can facilitate smoother relationships with local banks, suppliers, and partners.

7. Meeting Industry-Specific Legal Requirements

Certain industries in Turkey mandate a local presence for legal compliance. In such cases, a branch can provide the necessary local footprint without the higher costs and obligations of setting up a subsidiary.

How to Establish a Branch in Turkey

Required Documents for Branch Registration in Turkey

1. Petition
   • Signed by the authorized person(s) with the company seal.
   • If signed by proxy, the original power of attorney or a notarized copy must be attached.
   • The petition must specify the tax office, branch name, capital, head office, opening date, and NACE code. It must also declare that the information provided is accurate, with the signatory accepting liability for any discrepancies.
2. Establishment Notification Form (1 copy)
   • Completed and signed by the authorized person.
3. Chamber Registration Declaration
   • Signed by the authorized person(s) and includes photographs of the representatives.
4. Resolution of the Head Office’s Authorized Body
   • The decision must authorize the opening of the branch and appoint a fully authorized representative based in Turkey.
   • A notarized copy must be provided.
5. Power of Attorney
   • If the branch opening resolution does not specify full representation authority, a separate power of attorney granting such authority must be submitted.
6. Letter from the Competent Authority of the Country of Origin
   • Confirms that the company has met the necessary conditions to open a branch and lists the required registration documents.
7. Documents Required for Branch Registration in the Country of Origin
   • A notarized copy of these documents must be submitted.
8. Certificate of Current Company Records
   • The current registration records of the parent company and a certified copy of its articles of association must be provided.
9. Declaration Signed by the Head Office Representatives
   • This must include details such as the parent company’s name, type, business activity, capital, registration number, governing law, EU membership status, website, branch name, allocated capital, and details of the branch representative(s).
10. Required Documents for Branch Registration
    • Required if the branch opening is subject to special permits or approvals.
11. Notarized Passport Copies of Foreign Representatives
    • For foreign representatives, notarized Turkish translations of their passport copies must be submitted.
12. Signature Declarations
    • Signature declarations of the branch representatives, in accordance with TTK Article 40, must be included.

Important Notes

• Documents issued abroad must be certified by the Turkish Consulate or apostilled according to the Hague Convention.
• Notarized Turkish translations of these documents must be provided.

Branch Naming Guidelines

• The first branch opened in Turkey must include “Merkez Şubesi” in its name:
  Example: X Company GmbH Merkezi Almanya İstanbul Merkez Şubesi
• Subsequent branches should not include the term “Merkez” in their names.

Address Change Procedure for a Foreign-Based Company’s Branch in Turkey

1. Petition
   • Must be signed by the authorized person(s) with the company seal.
   • If signed by proxy, the original power of attorney or a notarized copy must be attached.
2. Notarized Copy of the Address Change Resolution
   • The resolution must be issued by the parent company or the Turkish branch.
   • If the document is issued abroad, it must be certified by the Turkish Consulate or apostilled in accordance with the Hague Convention. A notarized Turkish translation of the document must also be provided.

Appointment of Branch Manager for a Foreign-Based Company’s Branch in Turkey

1. Petition
   • Must be signed by the authorized person(s).
   • If signed by proxy, the original power of attorney or a notarized copy must be provided.
2. Notarized Copy of the Appointment Resolution
   • Issued by the parent company regarding the branch director’s appointment.
3. Signature Declaration of the Branch Director
4. Notarized Passport Copy and Tax Number of the Branch Manager (if foreign)
   • The passport must be translated into Turkish and notarized.
   • Tax number document must also be provided.
5. Acceptance Letter from the Branch Director
   • A statement indicating the acceptance of the role by the appointed branch director.

Capital Increase Process for a Foreign-Based Company’s Branch in Turkey

1. Petition
   • Must be signed by the authorized person(s).
   • If signed by proxy, the original power of attorney or a notarized copy must be provided.
2. Notarized Copy of the Capital Increase Resolution
   • Issued by the parent company regarding the branch’s capital increase.

Liquidation Initiation Process for a Foreign-Based Company’s Branch in Turkey

1. Petition
   • Must be signed by the authorized person(s).
   • If signed by proxy, the original power of attorney or a notarized copy must be provided.
2. Notarized Copy of the Liquidation Decision
   • Issued by the parent company authorizing the branch’s liquidation.
3. Signature Declaration of the Liquidator
   • Prepared according to TTK Article 40.
4. Acceptance Letter from the Liquidator
   • A statement confirming that the liquidator accepts the appointment.

Liquidation Completion Process for a Foreign-Based Company’s Branch in Turkey

1. Petition
   • Must be signed by the authorized person(s).
   • If signed by proxy, the original power of attorney or a notarized copy must be attached.
2. Notarized Copy of the Liquidation Balance Sheet Approval Decision
   • Issued by the parent company’s authorized body, confirming the acceptance of the final liquidation balance sheet.
3. Final and Definitive Balance Sheet
   • Prepared as of the decision date, signed by the liquidator and stamped with the branch seal.
   • Must be approved by the parent company’s authorized body.