Turkey
SETTING UP IN BUSINESS Introduction Turkey offers a natural gateway to three of the world’s largest and most dynamic markets: Europe, Asia and the Middle East. No wonder its economy is booming, up 34% over the four years to 2005, and still growing more than 5% per annum. Add to this a huge domestic market, an ambitious labor force and low wage costs, and you can see why Turkey is emerging as an essential centre for foreign investors.
Is Turkey a safe base for foreign investment capital? It is now. The Turkish economy suffered serious difficulties during the 1990s, but the business environment was transformed in 2001 when wide-ranging economic reforms were introduced. Then came the Foreign Direct Investment Law in 2003. Since 2003 the number of foreign companies in Turkey has more than doubled. And with Turkey currently negotiating terms for entry into the EU, the future looks good. How easy is it to open a Turkish company? Few countries do it faster. You can open a Turkish company inside a day, provided you have the correct documentation to hand. Our specialists are ready to guide you through the process. All you need to do is contact us – and we can have your new company up and running within hours. What are the main forms of business entity in Turkey? The two most popular forms of business entity in Turkey are: How much share capital is required for a limited liability (LS) company? The minimum share capital for a limited liability company is YTL 5,000 (€2,700) of which 25% should be paid up. What other requirements are there for a limited liability (LS) company? How much share capital is required for a joint stock (AS) company? The minimum share capital for an AS company is YTL 50,000 (€27,000) of which 25% should be paid up. What other requirements are there for a joint stock (AS) company? What other types of company are there in Turkey? The other main forms of business entity are: How easy is it to recruit staff? 73 million people live in Turkey, and much of the working population is semi-skilled. Unemployment is relatively high at around 10%. But the country’s economic renaissance has created an urban professional class, ambitious and well educated, and this is the sector from which foreign companies tend to recruit. Our recruitment specialists are ready to answer all your questions on staffing and labor laws. What is the regulatory environment like? Turkey has committed itself to a liberal business environment, reflected in the introduction of the Foreign Direct Investment Law in 2003. Corporation tax is now 20% and investor protection conforms with international standards. The 2003 law scrapped many of the regulations that had impeded foreign investment in the past, such as the requirement that foreign companies seek ministerial approval before formation. Are there financial incentives available? Turkey has a wide range of financial incentives for foreign investors. Major investors are except from customs duties and/or VAT on plant and equipment, while there are substantial additional incentives for companies that invest in less-developed provinces, free trade zones and high-technology parks. What about banking facilities? Turkey’s banking industry has recovered strongly from the currency collapse and recession in 2001. Today the banking sector is somewhat smaller but much more robust, and foreign investors can choose between long-established local banks or international institutions such as HSBC or Citibank. For help with opening a bank account in Turkey, please get in touch and we’ll tell you what you need to know.
