Foreign registered companies planning to invest in Turkey should
establish liaison offices that are regulated by the Regulation for
Implementation of Foreign Direct Investment Code ("the
Regulation") before they investment to promote their
commercial activities, analyze the market and follow the
Turkey's business opportunities.
Liaison offices are different from branch offices. Unlike branch
offices, liaison offices do not engage in income-generating
commercial activities, according to foreign capital regulations.
Additionally, all expenses should be covered by foreign currency.
As a result of such conditions, the economic structure of the
liaison office is closely monitored. The activities of the liaison
office is usually controlled ex officio by the Ministry or upon
written notification from relevant institutions and
A permit for establishing the liaison office should be obtained
from the Ministry of Economy. The opening permit applications
should be submitted with the documents requested in the Regulation.
The complete application package is usually processed within 15
There are certain requirements for foreign companies
establishing liaison offices in Turkey:
The company must be established in accordance with the laws and
regulations of its country of origin;
The liaison office must not conduct any commercial activities
in Turkey; and
The Ministry should provide a waiting period of at least one
(1) year to evaluate the area of activity, working capital, and
number of personnel employed for the company's liaison office
Upon fulfilling the aforementioned conditions, the application
should be submitted to the Ministry of Economy. The required
documents are as follows:
Application Form (Annex-6 of the Regulation);
Written statement that includes the liaison office's scope
of activity, as well as a document stating that the liaison office
will not engage in any commercial activities (Annex-7 of the
Regulation) and the authorization document from the foreign company
The Certificate of Activity of the foreign company, which
should be approved by the relevant Turkish Consulate or in
accordance with the provisions of the Convention Abolishing the
Requirement of Legalization for Foreign Public Documents, prepared
on the basis of the Hague Conference on Private International
Activity report or balance sheet and income statement of the
Authorization document of the person who is appointed to
conduct the operations of liaison office; and
Power of attorney in the event that another person operates the
establishment transactions of the liaison office.
The Ministry permits are valid for three (3) years after the
initial application process. For the extension of permits, the
offices should apply to the General Directorate of Incentive
Practices and Foreign Capital. The permit period of liaison offices
that operate in market research or promote the activities of
foreign companies is not extended. Additionally, the wages of
people working at liaison offices are exempt from income tax,
according to the Article 23 paragraph 14 of the Income Tax
A termination notification and examination of business note,
which is received from the relevant tax office, should be submitted
to the General Directorate in the event of the termination of the
liaison office's activities. Liaison offices must not claim any
money transfer apart from the balance due to termination and
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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