Foreign Company Entry into Turkey: Subsidiary, Branch or Liaison Office (2026)

Yes. A foreign company can generally own shares in a Turkish company, including a wholly foreign-owned Turkish subsidiary, subject to sector-specific restrictions. When an overseas parent company enters Türkiye, the more important question is which market-entry vehicle fits the planned activity: a Turkish subsidiary, a branch office, or a liaison office.

The three structures solve different problems. A subsidiary is a separate Turkish legal entity whose shareholder can be the foreign parent. A branch is a commercial extension of the foreign parent and is not a separate legal entity. A liaison office is a Ministry-licensed, non-commercial representative presence and cannot conduct commercial activity in Türkiye.

The Republic of Türkiye Investment Office’s current Establishing a Business guide confirms the equal-treatment principle for international investors, the foreign legal-entity shareholder route, the branch framework and the liaison-office licensing rules.

Workon coordinates Turkish market-entry and operational setup for foreign companies.

Foreign Company Entry into Turkey: Quick Decision Table

Annual foreign-investment reporting is not the same for all three structures. Foreign-capital companies and branches within the FDI framework complete the applicable annual EK-1 activity information electronically through E-TUYS by the end of May. Liaison offices instead submit the EK-4 liaison-office activity form and supporting evidence to the Ministry by the end of May. Failure to submit the liaison-office annual form can block an extension request and can expose the office to ex officio cancellation of its operating permit.

1. Turkish Subsidiary Owned by a Foreign Parent Company

A subsidiary is a Turkish company with its own legal personality. The foreign parent holds shares in that Turkish entity rather than operating through the same legal identity. In practice, the most common corporate forms are the limited liability company (LLC) and joint stock company (JSC).

Current official investment guidance states that international investors may establish company forms under the Turkish Commercial Code and that there are generally no nationality restrictions on shareholders or management rights, except in specific regulated sectors.

When a subsidiary is usually the stronger structure

• the group wants a separate Turkish operating company;
• the Turkish business will have its own contracts, assets, employees and banking relationships;
• future investors or additional shareholders may join the Turkish company;
• the local business may need a broader activity framework than the foreign parent’s existing purposes;
• the group wants governance through shareholder rights in a distinct Turkish entity.

Liability: use precise wording

The structural advantage is that the subsidiary has a separate legal personality. That does not mean the foreign parent can never face exposure. Guarantees, contractual commitments, director or manager conduct, tax matters and group arrangements can affect practical liability. The correct comparison is structural separation—not an absolute “firewall” promise.

2. Branch Office of a Foreign Company in Turkey

A branch is the foreign parent company carrying on business in Türkiye through a registered local branch. Official guidance is explicit: the branch has no shareholders, is not an independent legal entity, has no statutory capital requirement, and may operate only for purposes within the scope of the parent company.

This makes a branch materially different from a subsidiary. The parent is not merely a shareholder; it is the legal enterprise behind the Turkish operation.

When a branch is usually worth evaluating

• the foreign parent itself should be the contracting business in Türkiye;
• the Turkish operation closely mirrors the parent’s existing activity;
• the group does not need a separate Turkish shareholder structure;
• direct legal linkage between the parent and Turkish operation is acceptable;
• the branch’s commercial and reporting structure fits the group’s tax and governance plan.

A branch is not automatically faster, cheaper or lower-risk than a subsidiary. Current Istanbul Trade Registry guidance requires the foreign parent to appoint a fully authorised representative resident in Türkiye for the branch. Foreign parent-company documentation, that representative arrangement, banking/KYC, licensed CPA/SMMM and tax-compliance onboarding, and internal group approvals can materially affect the real setup burden.

For the binary decision, see Branch Office vs Subsidiary in Turkey. If the branch route is already chosen, continue with How to Register a Branch Office in Turkey.

3. Liaison Office in Turkey

A liaison office is fundamentally a non-commercial structure. A foreign company may establish one only after obtaining a license from the Ministry of Industry and Technology, and the office may not engage in commercial activity in Türkiye.

Typical liaison-office purposes

• market research and feasibility studies;
• representation of the foreign parent;
• supplier or group-company coordination;
• regional coordination;
• information gathering and other approved non-commercial functions.

If the Turkish presence must sell products or services, invoice customers, collect sales revenue or otherwise operate commercially, the liaison-office route does not fit that objective.

Permit period and official processing target

Current official guidance states that initial liaison-office licenses may be granted for a maximum of three years within the declared activity. Establishment and extension applications are stated to be concluded within 15 working days when the requested information and documents are complete and accurate. This is a government processing target for the liaison-office application—not a guaranteed end-to-end market-entry timeline.

Extensions are activity-dependent. Official guidance specifically states that offices licensed for market research or promotion of the foreign company’s products or services are not extended merely as a continuation of the same activity.

After establishment, the liaison office must also complete time-sensitive Ministry follow-up: current official guidance requires copies of the tax-registration record and office lease to be submitted to the General Directorate within one month. Changes to the office representative, foreign-company title or address are also subject to one-month notification rules with the relevant supporting documents.

The annual reporting duty is separate. Under the current foreign-investment framework, the liaison office submits its annual activity information and supporting documents by the end of May. Failure to submit the required annual package can prevent an extension request from being evaluated and can expose the activity permit to ex officio revocation under the applicable rules.

For the direct non-commercial-versus-commercial comparison, see Liaison Office vs Branch in Turkey.

Can a Foreign Company Be the Shareholder of a Turkish LLC or JSC?

Generally, yes. The foreign parent can be a legal-entity shareholder in the new Turkish company. The official registration guidance has a specific document lane for a foreign legal entity designated as shareholder.

The core issue is not whether a foreign company can own the shares, but whether the Turkish registration file proves the foreign company’s current legal status, authorized signatories and valid corporate approval to establish or invest in the Turkish entity.

Foreign Corporate Shareholder Documents: What the Turkish File Needs to Prove

The exact document names vary by jurisdiction, but the Turkish file generally needs evidence covering four questions:

The Investment Office’s current guidance specifically says that a foreign legal-entity shareholder’s certificate of activity should show the company’s current status and signatories, and that the competent corporate body must authorize the establishment.

A “Certificate of Good Standing” is therefore not automatically sufficient by itself if it does not contain the information required for the Turkish filing or if additional corporate approval/signatory evidence is needed.

Apostille, Consular Legalization and Turkish Translation

Foreign corporate documents must be prepared for valid official use in Türkiye, but the authentication sequence should follow the exact document and receiving authority rather than one universal formula. For example, current Istanbul Trade Registry guidance for a foreign company branch requires foreign-law documents in the branch file to be authenticated through the relevant Turkish consulate or the Apostille Convention, with a notarised Turkish translation. Foreign corporate-shareholder and liaison-office files should likewise be checked against their own current document list before execution.

Before ordering documents, confirm exactly which authority issues each record, whether the document itself or an official/notarial certification is the item to be authenticated, whether the Apostille Convention applies or Turkish-consular legalisation is required, and what Turkish translation/notarial treatment the receiving authority expects. This prevents paying for the wrong document or completing an unnecessary authentication step.

For deeper document questions, use the Apostille for Turkey Documents guide and the relevant sworn-translation guidance rather than turning this market-entry page into a document-legalization manual.

Branch Documents vs Subsidiary Documents vs Liaison Documents

Tax and Statutory Compliance: Do Not Choose the Structure from One Tax Rate

A Turkish subsidiary and a Turkish branch both create Turkish tax and statutory-compliance obligations, but their legal and profit-repatriation mechanics differ. A liaison office is non-commercial but still has local administrative, payroll, lease, social-security and Ministry-reporting requirements.

The correct tax comparison depends on the parent jurisdiction, Turkish activity, applicable double-tax treaty, profit-flow plan and sector. Do not choose a structure from a generic statement that one option is always “tax-free,” “simpler” or “cheaper.”

Registration Is Not Operational Readiness

Whichever structure is selected, establishment is only the legal starting point. Depending on the model and activity, operational readiness can also require:

• registered address and premises suitability;
• tax registration/follow-up and licensed CPA/SMMM and tax-compliance onboarding;
• corporate bank-account and KYC preparation;
• SGK/employer setup and payroll processes;
• work permits for foreign staff;
• KEP, e-signature and other digital compliance tools;
• sector licenses, municipal permits or customs registrations;
• local contracts, invoicing and internal group approvals.

A Trade Registry certificate or liaison-office license does not automatically mean the Turkish operation is ready to bank, hire, invoice, import or move foreign staff.

Which Structure Should a Foreign Parent Choose?

Evaluate a subsidiary when you want a separate Turkish operating company with its own legal identity, governance and future shareholder flexibility.

Evaluate a branch when the foreign parent itself should conduct commercial activity in Türkiye and the parent accepts the direct structural link to branch obligations.

Evaluate a liaison office when the Turkish presence is strictly non-commercial and exists for approved research, representation or coordination.

How Workon Supports Foreign-Company Market Entry

Workon coordinates market-entry and operational setup for foreign parent companies entering Türkiye, including Turkish subsidiary or branch setup, liaison-office preparation workflows, registered address and workspace, document sequencing, bank-account application support, licensed CPA/SMMM onboarding coordination and other post-establishment steps. Where legal, tax, CPA/SMMM or another regulated professional scope is required, Workon can coordinate the appropriately authorised professional and keep that work aligned with the wider market-entry and operating plan.

For a Turkish subsidiary, see Workon company registration support. If you are still deciding between structures, first identify whether the Turkish operation will be commercial and whether it needs a separate Turkish legal identity; those two questions eliminate most of the wrong options immediately.

Official Reference Points

• Invest in Türkiye — subsidiary, branch and liaison-office framework
• Istanbul Chamber of Commerce — foreign-company branch registration
• Ministry of Industry and Technology — E-TUYS
• Ministry of Industry and Technology — liaison-office procedures

Current-rule note: Last reviewed 17 September 2026. Subsidiary, branch and liaison-office suitability depends on the parent company, planned Turkish activity, sector, reporting obligations and current authority requirements; Workon can coordinate the relevant setup, licensed-professional and authority-facing workstreams around the selected entry model.