COMPANY ESTABLISHMENT AND REGISTRATION PROCEDURES

FOREIGN DIRECT INVESTMENT LAW

The main elements of the new “Foreign Direct Investment Law” are the following;

All former FDI related screening and approval procedures have been abandoned for business set ups and share transfers. Foreign investors will no longer be required to obtain pre approval for these transactions, except for some designated sectors. The conditions for business set ups and share transfers will be the same as for comparable local investors.

Pre approval requirements for certain transactions of foreign investment companies have also been eliminated. Foreign capital companies will follow the same procedures as local companies to realise these transactions.

The minimum capital requirement of USD 50,000 per each foreign shareholder has been abolished.

Foreign investors will be able to form a partnership in Turkey. In the old regime, foreign investors were only allowed to form a joint stock company or a limited company. Now, any form of company included in the Turkish Commercial Code is acceptable for foreign investment.

Valuations of international credit agencies as well as courts or competent authorities of the investor’s country will be accepted as valid in the determination of the share value for marketable securities that are contributed as capital in-kind.

The new “Foreign Direct Investment Law” has also reassured the foreign investors’ existing rights on a stable document;

The foreign investment legislation is based on the principle of equal treatment for the domestic and foreign investors. Generally foreign investors have the same privileges and obligations as the domestic capital.

Foreign capital companies established in Turkey have the same rights to acquire a real estate as domestic investors. Foreign real persons may own a real estate according to the principle of reciprocity.

In terms of this new law, Turkish nationals who verify with work or resident permit, domiciled abroad are deemed as foreign investors.

Limited Company: It is the company established with participation of minimum 2 and maximum 50 real person or legal entities. The liability of the shareholders is restricted only to the capital subscribed by the shareholder. Minimum capital of 5000 NTL is mandatory. Unlike Joint stock companies no stock certificate is issued.

COMPANY ESTABLISHMENT PROCEDURES

All the documents and statements described here below should be submitted to the Trade Registry Offices located at the province where the company or partnership will be established .

The documents delivered to Trade Registry Offices should get the official approval after their examination of whether all given and described conditions on the documents and statements are in compliance with legislation and clear that all the rights of third person is covered.

The company can start to operate its business activity after the approval and registration of Trade Registry Offices by receiving registration number which is unique for every established company.

In Istanbul Trade Registry Office, all registered documents and statements are being computerised and also filed in company dossiers as well.

The related copies of this official newspaper which is published only in Turkish are also computerised and filed in the related companies’ dossiers.

All registrations formalities are liable to charges annually declared by Ministry of Finance and the fees for publicity on Turkish Commercial

ESTABLISHING A COMPANY IN TURKEY

The forms of Chamber Registration Statement, Establishment Statement and Letter of Commitment which are mentioned among the requested documents are available on our web site and can be also provided from our Chamber and its branches.

Ýn application of Ýstanbul Trade registry office for foreign nationals, the induvidual tax identity number taken from tax offices is not for company.

DOCUMENTS REQUIRED FOR MERCHANT REGISTRATION:

1. Petition (must be signed by the merchant),

2. Company name certified by a notary public (contains the information of home address, business address, business subject, commencement date of operation, nationality, company name and the 3 specimen signatures of the merchant under the company name),

3. A copy of the passport (translated and certified by notary public),

4. Chamber Registration Statement (must bear the photo of the merchant),

5. Letter of Commitment (signed by the merchant),

DOCUMENTS REQUIRED FOR FORMING LIMITED COMPANIES

1. Petition (The Tax Office registered must be indicated, signed by person authorised or by proxy, and the original or notarised copy of the power of attorney must be attached).

2. Establishment Statement (the related gaps must be filled in and signed by an authorised person) – (5 copies).

3. Notary public certified Articles of Incorporation (3 copies).

In case the foreign national partner is a natural person the documents required are:

Two copies of the passport (translated and certified by notary public),

In case the foreign national partner is a legal entity the documents required are:

The foreign investor should have Activity Certificate of his or her company prepared by the relevant authority in the investor’s country. This certificate should contain the information about the current active status of the company and its signature executives.

Power of Attorney should show the authority or the natural person who will run the establishment procedure in Turkey on behalf of the company in origin. This attorney should mention company title which will be either established or participated in Turkey and the name of authorised person for presentation.

The above mentioned certificates (Activity Certificate, Power of Attorney) should be undersigned either by Apostle or Turkish Consulates in Foreign investors’ country.

The approved certificates should be notarised and translated into Turkish before their delivery to Trade Registry Office.

1. Signature Declarations of the authorised persons under the company name (2 copies),

2. Original of Bank receipt (receipt from Ziraat Bank Bilkent Plaza Branch indicating that the 4/10000 of the capital is deposited to the Arbitration Court, or the EFT receipt signed and stamped “collected” (Account No: 5383761-5016),

3. Chamber Registration Statement (must bear the photos of natural partners),

4. Letter of Commitment (must be signed by authorised persons).

For the foreign nationals residing in Turkey, notarised Residence Permit must be submitted.