|Type of the company||“Turkish Limited Company”OR
“Turkish Joint stock Company”
|Shareholding||The number of shareholders and its significance
As per Commercial Code, 1 shareholder would now be sufficient to establish the company. However, more than 50 shareholders can not be sought for limited liability companies while no such limit is brought by law for joint stock companies.
Important point is to bear in mind that Company shareholder’s resolution must be obtained with the signature of minimum two shareholders holding majority shareholding. Exception of this requirement is when there is only one shareholder.
|Name of the company:||The trade name should not carry an essence to mislead third parties with regard to the scope of activities, significance or financial status of the company, nor should contradict facts and public order.
The trade name has to be in Turkish language. However, the presence of foreign words in the trade name of a company may be permitted in cases, where these words do not contradict the law, the national, cultural and historical benefits; where the name or brand promoting the goods or services constituting the business activity of the company is in a foreign language or there is/are foreign shareholder/s in the company.
|Company core business, the Objective and Field of Activity:||The company’s core activities must be stipulated. Examples could be construction, tourism, food, export, import, etc. This can be up to 5 fields and usually used up to its limits to give most flexibility.|
|Address of the company||The address has to be specified in the articles of association.|
|Amount of initial capital||Limited company can be set up with a minimum initial capital amount of TL 10,000.-
Joint stock company can be set up with a minimum initial capital amount of TL 50,000.-
¼ of the total capital is to be paid at the time of establishment and ¾ to be paid within 24 months following the official establishment.
|Director(s) / Management Board members:|| Process for LTD COMPANY: Initial director(s) is attained by the AoA. At least one shareholder should also be appointed as one of the directors should there be more than one director.
Process for JS COMPANY: Initial management board is attained by the AoA (for a period of 3 years). This management board can be constituted of 1 or more members.
The general principle is that the boundaries of the liability for the company activities are limited to the company capital. If the company assets do not cover the company liabilities, it is not possible to have recourse from the company shareholder’ personal assets.
Personal Liabilities of the Shareholders:
The shareholders are only responsible for the capital share that they have committed to the company as well as other undertakings if arranged within AoA in addition to capital share.
For LTD Companies, shareholders are personally liable for the company’s state debt such as tax debt, within the frame of promised capital share.
Personal liability of the Company Manager / Management Board Members:
The directors / management board members, whether they are shareholder or appointed externally, have personal liability if the liability is derived from the company’s state debts such as tax debt.
Such responsibility is stipulated in Clause No 10 of The Tax Procedure Law (Law number 213), and the Clause 35 of The Law for Recovery of Public Claims (Law No: 6813) According to the said laws if the company assets do not provide enough coverage for the public claims such as tax, national insurance premiums etc, then the related state organisation can have recourse to the personal assets of the company directors.
|Required documents:||1- Identification Documents: TR ID / Passport copies of the shareholders. If the documents are showing foreign nationality, translation and notarisation is required.2- Residency Documents: Residency documents mean that documents verifying your residential address based on tax or utility documentation.
3- Requisition for Registry: This document is preferably needed to be issued in TR by the director at the same time signing the Article of Association.
4- Signature Circular: This document is preferably needed to be issued in TR by the director upon concluding the procedures regarding a company set up in Turkey before Trade Registry Office.
|Power of attorney (PoA):||If all shareholders are in present in Turkey we would not need any PoA for set up matter. However, if this is not the case PoA is required for set up process and for any follow up there may be. Arranging a PoA will help to avoid number of trips.POA can be arranged abroad (would add to time line of setting up process) or can be obtained in Turkey.
When required, we generally prepare the wording of the power of attorney document (s) to be used.