COMPANY ESTABLISHMENT TRANSACTIONS IN TURKEY
In Turkey, the company establishment procedures, if necessary documents submitted the related trade registry offices, can be completed within a few days.Establishing a company in Turkey by foreign real or legal persons is subject to the same rules as domestic investors.
Establishment procedures are performed electronically on the Central Registry System (MERSIS).
Steps of Establishment
· Users can start the company establishment process by creating membership via MERSIS internet address https://mersis.gtb.gov.tr/. In the preparation of the company Article of Association on MERSIS, Turkish citizens can be added with their ID numbers and foreigners with their passport numbers as partner or authorized. However, for this process, foreigners must first obtain a tax number from the tax office and register it to MERSIS by applying to the trade registry office.
· MERSIS directs the user to fill in the legally required elements of the Article of Association and the company Article of Association is prepared by entering the necessary information. The Article of Association is prepared in Turkish. The company’s potential tax number is also automatically assigned by MERSIS. The founders then sign the Article of Association.
· The signatures of the persons authorized to represent the company under the title of the company shall be approved by the competent authority and signature declarations shall be prepared. This process is carried out in any trade registry offices in Turkey.
· 0.04% of the Company’s capital must be deposited in the bank account of the Competition Authority as “Share of the Competition Authority”. There is no need to go to the bank for this transaction. This amount can be paid in trade registry directorate together with other establishment transactions. In addition, at Joint Stock Companies at least 25% of the shares committed in cash must be deposited into a bank account opened on behalf of the company before the registration of the company.
· Upon the application of the founders together with the relevant documents to the registry directorate, the trade registry directorate completes the registration process. In addition, in the establishment of Joint Stock and Limited Liability Companies and the CooperativeCompanies, the commercial books to be kept by these are approved by the trade registry directorate and given to the related party following the registration. It is also possible to carry out the establishment transactions through a representative authorized by Power of Attorney.
Share Transfer in Capital Companies
Foreign investors instead of establishing a company directly can also invest by acquiring shares in a company already established in Turkey. It is also possible for them to leave the company partnership by transferring the shares they have taken over to others.
Joint Stock Companies may issue registered and bearer shares in order to represent the shares. The owner of the bearer shares of a Joint Stock Company is the person who has them in his possession.As a result, it is possible to transfer the bearer share of a Joint Stock Company simply by delivering its possession to the transferee. The transfer of registered shares is carried out with the transfer of turnover and possession. Except in exceptional circumstances Joint Stock Company may be transferred freely without being subject to any restrictions.At the same time, share transfer in joint stock companies is not subject to registration and announcement.
Transfer of shares in limited companies includes the processes required by law. These are;
· Signing the share transfer agreement between the parties and notarizing it,
· Unless otherwise stipulated in the company Article of Association, the approval of general to the transfer of shares,
· Share transfer Article of Association, the decision of general assembly approving the transfer and registration and announcement of the share transfer.
Liquidation
The company terminates in case the realization of any of the reasons for termination stipulated at the law and in line with the decision of the shareholders. The terminated company enters the liquidation process. The issue that the company has ended and entered into the liquidation process shall be registered and announced to the relevant trade registry directorate.
The company in liquidation, including its relations with shareholders, maintains its legal personality until the end of the liquidation and uses the trade title as the expression of “in liquidation” added.
The purpose of the liquidation is to sell the assets of the company and convert them into money, collect their receivables, pay their debts and complete their unfinished business.
The actions to be taken during the liquidation process is carried out by the liquidation officers. At least one of the liquidation officers must be Turkish citizen and resident in Turkey. Liquidation officers can be appointed by Articles of Association or General Assembly resolution. If not appointed in this way, the liquidation is done by the Board of Directors. Liquidation officers must also be registered and announced in the trade registry.
Upon the end of the liquidation, the liquidation officers apply to the trade registry directorate to delete the trade name of the company from the register. Deletion is registered and announced upon request. The legal entity of the company end by deletion.
On the other hand; in case of bankruptcy, the liquidation shall be carried out by the Bankruptcy Administration in accordance with the provisions of the Enforcement and Bankruptcy Law. In the event that the company is deeply in debt in other words, if the assets of the company are not sufficient to cover the receivables of the creditors of the company, the board of directors in joint stock companies and the directors in limited liablity companies request the bankruptcy of the company, not the liquidation of the company.
Branches of Foreign Companies
For the commercial enterprises which their centers are abroad their branches in Turkey are registered as domestic commercial enterprises. A full authorized commercial representative is assigned for these branches whose residential is in Turkey. If the commercial enterprise has more than one branch the branches to be opened after the registration of the first branch are registered as the branches of domestic commercial enterprises.
For the registration of a foreign company’s branch in Turkey, the documents to be submitted to the relevant trade registry directorates are as follows:
· A certified copy of the documents containing the company’s current registry records and the company Article of Association, and one Turkish translated copy for each.
· The original copy of the decision of the company’s authorized body, about opening branch, and the appointment of full authorized Turkish resident represantative to company, and a copy of Turkish translation.
· The original decleration signed by the the company center authoritatives, and a copy of its Turkish translation,
· If the person or persons, who is full-authorized to represent the branch against private and public institutions including the courts in Turkey and powers conferred on them is not specified in the branch opening decision, the original copy of the power of attorney on this issue and a copy of its Turkish translation.
· Signature declarations of the persons who will represent the branch.
· For branches that are subject to the approval or appropriate statement of the Ministry of Trade or other official institutions, the letter of approval or appropriate statement.
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