Country Trading Profiles Turkey

Setting up a company | FDI in figures | Why you should choose to invest | Procedures relative to foreign investment | Finding assistance for further information

Setting up a company

Types of companies and capital (max/min)	Number of partners/shareholders and liability
The Limited Sirket is a limited liability company TRY 50,000	5 partners minimum Liability is limited to the amount of capital contributed.
The Anonim Sirket is a public limited company TRY 50,000	5 partners minimum Liability is limited to the amount of capital contributed.
Limited Liability Partnership TRY 50,000	2 partners minimum 50 partners maximum Liability is limited to the amount of capital contributed.
Individual company The notion of capital does not exist. The assets of the company are merged with those of the head of the company.	1 person The businessman is indefinitely liable for the professional debts on the whole of his assets.
General partnership (SCS) or joint-stock company (SCA) SCS: Contrary to joint-stock companies (SA, SAS, SCA), no minimum capital is required to constitute an SCS.The partners decide freely the amount of capital to be paid up at the constitution. SCA: The same rules as for an SA.	The SCS - SCA is made up of two distinct categories of partners: the active partners and the silent partners. The silent partners are the shareholders of the company, and are only liable for debts according to the amount of capital they have contributed. The shares are registered. The silent partners' assembly follows the same rules as in a public limited company (SA). The active partners have the status of traders, and are appointed by the silent partners. They are indefinitely and jointly liable for debts on their own property.

Business setup procedures

Setting up a company	Turkey	Eastern Europe & Central Asia
Procedures (number)	6.0	6.3
Time (days)	6.0	16.3

Source: Doing Business.

For further information: Consult Doing Business Website, to know about procedures to start a Business in Turkey.
Turkish Trade Registry Gazette
Trade Register
The competent organization: The Chambers of Commerce and Industry in each region where the headquarters of the company have been set up:
Istanbul (ITO) ; Izmir (IZTO) ; Bursa (BTSO) ; Ankara (ATO)

FDI in figures

Foreign Direct Investment	2008	2009	2010
FDI inward flow (millions USD)	18,148	8,411	9,071
FDI stock (millions USD)	70,118.3	143,623.0	181,901.0
Performance Index*, ranking on 141 economies	95	109	-
Potential Index**, ranking on 141 economies	76	-	-
Number of Greenfield investments***	170	153	-
FDI inwards (in % of GFCF****)	12.5	13.5	-
FDI stock (in % of GDP)	9.6	12.6	-

Source:

Note: * The UNCTAD Inward FDI Performance index is based on a ratio of the country's share in global FDI inflows and its share in global GDP. ** The UNCTAD Inward FDI Potential index is based on 12 economic and structural variables such as GDP, foreign trade, FDI, infrastructures, energy use, R&D, education, country risk. *** Green field investments are a form of foreign direct investment where a parent company starts a new venture in a foreign country by constructing new operational facilities from the ground up. **** Gross fixed capital formation (GFCF) measures the value of additions to fixed assets purchased by business, government and households less disposals of fixed assets sold off or scrapped.

Why you should choose to invest Turkey

Strong points: - A geographical strategic location;
- A well developed industrial basin;
- A country whose calling is to join the EU club by 2015-2020;
- A rapidly developing consumer middle class;
- A Flexible labor law, which favors investment and low labor costs;
- A sustained growth influenced by a modern and dynamic private sector;
- A strong increase in productivity in recent years;
- A legal framework close to European standards and favorable to investment.
Weak points: - The slowing down of economic and political reforms observed;
- A strong dependenc on hydrocarbon imports and on exports;
- An uncertainty regarding the exchange rate;
- A disturbing deficit of the balance of current payments;
- Insufficient and sometimes obsolete, infrastructures;
- An informal sector difficult to reduce.
Government measures to motivate or restrict FDI: Since 2003, investors are no longer obliged to acquire a minimum interest.
Nevertheless, the government encourages investments in the form of Build Operate Transfer (BOT) (law n° 4283 of 16 July 1997). It favors investments in the High Tech, textiles, services (health, education, transport), telecommunications, shipbuilding, electronics and biotechnologies sectors. Export-oriented projects are also promoted.
Decree n° 24 810 of 9 July 2002 defines public aid for investment.
Bilateral investment conventions signed by Turkey: Turkey has signed bilateral conventions with nearly 80 countries. In the Mediterranean basin, Turkey has signed bilateral conventions with Algeria, Egypt, Israel, Spain, Greece, Lebanon, Morocco, Portugal and Tunisia. 44 conventions can be downloaded on the UNCTAD website: click here to download these conventions. They define the framework of protection for foreign investment in Turkey for each of the signatory countries.

Procedures relative to foreign investment

Freedom of establishment: Guaranteed
Acquisition of holdings: Possible
Obligation to declare: Foreign investors only have to inform the General Directorate of Foreign Investment (GDFI) through the under-secretariat of State to the Treasury.
Competent organization for the declaration: Turkish Treasury
Requests for specific authorizations: In some sectors considered to be strategic such as petroleum, the media (radio and TV) and tourism, acquisitions are limited to a certain amount (law n° 6326 of 1954).

Finding assistance for further information

Investment aid agency: Invest in Turkey
DEIK
Other useful resources: IGEME

COUNTRY TRADING PROFILES