- Establishing a Free Zone branch in Turkey allows foreign companies to conduct export-oriented operations while benefiting from significant tax and customs incentives. Free Zones are specially designated areas considered outside the customs territory for most trade purposes, designed to attract manufacturing, logistics, and service investments.
For manufacturers, corporate income tax (CIT) exemption on export profits, along with customs and VAT reliefs, creates a highly efficient operational environment. Selected logistics and service companies may also benefit from exemptions under defined scopes.
Why Open a Free Zone Branch?
Opening a branch—rather than a new legal entity—enables foreign companies to maintain their parent company’s legal identity while conducting operations in Turkey. This structure is ideal for companies seeking to:
- Manage export/import transactions efficiently,
- Establish warehousing or light production facilities,
- Benefit from Free Zone incentives without forming a new company,
- Reduce customs and tax exposure for export-focused activities.
Operations within a Free Zone require an Operating License issued by the Ministry of Trade, which defines the permitted activities and duration of operation.
Step-by-Step Process for Establishing a Free Zone Branch
1. Selecting the Zone and Facility
Identify the most suitable Free Zone among Turkey’s 18 active zones, considering location, infrastructure, and sector focus. Engage the zone operator to secure a leased unit, land, or ready facility. Once the preliminary agreement is made, your application file is forwarded via the Free Zone Directorate to the Ministry of Trade.
2. Operating License Application
Submit the official Operating License Application Form together with your business plan, supporting documents, and proof of payment of the USD 5,000 (or TL equivalent) application fee to the designated Central Bank account.
Operating license durations vary depending on status:
- Tenant companies: 15 years (20 for manufacturers)
- Investor companies: 30 years (45 for manufacturers)
3. Board Resolution and Corporate Documents
Prepare a board resolution authorizing the branch opening, capital allocation, and appointment of authorized signatories.
Typical documentation includes:
- Articles of association,
- Certificate of good standing or registry excerpt,
- Signature circulars and notarized Power of Attorney (if required).
Exact requirements may differ by zone, operator, or activity type.
4. Trade Registry Registration
Once the Ministry grants pre-approval and the lease agreement is finalized, register the branch with the Trade Registry of the province where the Free Zone is located.
Publication in the Turkish Trade Registry Gazette follows, after which the branch obtains its tax identification number.
5. Free Zone Directorate Registration Registration
Before commencing operations, every licensed company or branch must be recorded in the Free Zone Directorate Registration Book . This registration is specific to the Free Zone and separate from the national trade registry.
6. Customs and SBIF/SEBIS Setup
Prepare for SBİF (Free Zone Transaction Form) procedures and, if applicable, integrate with SEBİS or related IT systems for customs declarations and reporting.
Timeline and Practical Expectations
- Ministry review: approximately 15–20 business days for a complete application.
- Trade registry and tax number: usually completed within 1–3 business days, depending on local registry workloads.
Estimated Costs
- Operating License Fee: USD 5,000 (official)
- Rent or land-use fees: generally USD-indexed and determined by the zone operator.
- Other costs: notary, translation, registry, and advisory fees (variable by case).
As procedures and rates may change, verification with the zone operator and the Ministry is always recommended.
Tax and Customs Framework
Corporate Income Tax (CIT):
Profits from the export of goods manufactured within the Free Zone are exempt from corporate tax. As of 1 January 2025, domestic sales of zone-produced goods no longer qualify for this exemption.
Withholding Tax on Wages :
If at least 85 % of annual FOB sales consist of exports, employee wages within the Free Zone are exempt from income tax through the withholding refund mechanism .
VAT and Customs Treatment:
- Deliveries from Türkiye to a Free Zone are treated as exports (no VAT).
- Deliveries from the Free Zone to Türkiye are treated as imports.
- A.TR certificates may be issued for eligible transactions under Customs Union rules.
Stamp Duty and Fees:
Transactions and documentation directly related to Free Zone activities are exempt from stamp duty and certain charges, subject to the scope of the operation.
Accounting and Compliance
Free Zone branches must maintain separate accounting books for on-zone activities and avoid mixing them with off-zone transactions.
Companies should ensure proper SBİF reporting, customs reconciliations, and alignment with Turkish accounting standards (TFRS/IFRS).
Why Work with ÖzbekCPA
With over two decades of experience assisting international investors, ÖzbekCPA provides comprehensive guidance from license application to operational setup.
Our team ensures full compliance with Free Zone, tax, and commercial regulations while helping you maximize available incentives and minimize administrative complexity.
