Quick answer: Türkiye’s Foreign Direct Investment Law (Law No. 4875) is built around freedom to invest and national treatment: foreign investors are generally free to make direct investments in Türkiye and are generally treated on the same basis as domestic investors, subject to international agreements and special/sector-specific laws. For the practical business case, compare the benefits and trade-offs of registering a company in Turkey against the intended activity.
This guide covers foreign-investor legal-rights and FDI framework. It does not repeat the full company-formation process. For foreign-founder eligibility and documents, use Setting Up a Company in Turkey as a Foreigner. For the complete incorporation workflow, use Company Formation in Turkey: Complete 2026 Guide.
What the Foreign Direct Investment Law Actually Does
| FDI principle |
What it means in practice |
What it does not mean |
| Freedom to invest |
Foreign investors may generally make direct investments in Türkiye |
Every sector is automatically open without licences or special rules |
| National treatment |
Foreign investors are generally treated on the same basis as domestic investors |
Immigration, work permits or regulated-sector rules disappear |
| Protection against expropriation/nationalisation |
FDI Law protects investments from expropriation/nationalisation except for public interest and compensation under due process |
Commercial loss or regulatory change is guaranteed against |
| Transfer of proceeds |
Net profits, dividends and certain investment proceeds may generally be transferred abroad through banks/financial institutions |
Bank KYC, tax, sanctions or documentation requirements are waived |
| Dispute mechanisms |
Local courts and, where conditions/agreements permit, arbitration or other mechanisms can be available |
Every dispute automatically qualifies for international arbitration |
| Foreign personnel |
The FDI framework recognises employment of foreign personnel as part of investment policy |
Company ownership itself gives an automatic work permit |
FDI rule: Equal treatment is the starting principle, not an exemption from Turkish company, tax, banking, immigration or sector regulation.
Türkiye’s FDI framework is based on investment freedom and general equal treatment, subject to special laws and sector rules.
Who Counts as a Foreign Investor?
Law No. 4875 defines foreign investors broadly to include foreign-national individuals, Turkish nationals resident abroad, foreign legal entities established under foreign law and international institutions making direct investment in Türkiye.
Foreign direct investment can include establishing a new company or branch, or acquiring shares in an existing Turkish company, subject to the law’s definitions and applicable sector-specific rules.
Can a Foreign Investor Own 100% of a Turkish Company?
In general, yes. Current Invest in Türkiye guidance states that companies with foreign shareholding established under the Turkish Commercial Code are generally treated on the same basis as locally owned companies, and 100% foreign shareholding is possible.
However, this is not a universal statement for every regulated or strategic sector. Broadcasting, aviation, maritime, finance and other regulated activities can have specific ownership, licensing, capital or approval rules.
Which Structures Can a Foreign Investor Use?
Foreign investors can generally use the company forms available under the Turkish Commercial Code. In practice, the most common market-entry choices are:
- Turkish LLC;
- Turkish JSC;
- Turkish subsidiary owned by a foreign parent;
- branch of a foreign company;
- liaison office for a non-commercial representative presence, subject to Ministry permission.
For structure choice, see Subsidiary, Branch or Liaison Office in Turkey.
FDI Reporting Continues After Registration
Law No. 4875 is an investment-freedom framework, but the current implementing Regulation also creates information-reporting duties. Companies and branches within the Foreign Direct Investment Law framework must use E-TUYS for the applicable foreign-investment records and, among other required updates, submit the EK-1 Direct Investment Activity Information electronically each year by the end of May.
The same framework also requires specified event-based E-TUYS updates. For example, capital increases or decreases require the shareholder-list data to be updated within one month; payments made in connection with a capital increase or share transfer can require the EK-2 capital-information fields within one month; and shareholder-list information must be updated within one month after a covered share transfer. Apply the current rule to the actual transaction rather than treating the annual EK-1 filing as the only FDI-reporting obligation.
Liaison offices use a separate reporting route. They submit the EK-4 Liaison Office Activities Information Form and required attachments to the Ministry by the end of May each year. Under the current Regulation, failure to submit that annual liaison-office package can prevent an extension request from being evaluated and the activity permit may be revoked ex officio.
E-TUYS — Ministry of Industry and Technology · Liaison-office procedures — Ministry of Industry and Technology.
National Treatment Does Not Mean “No Extra Documents”
A foreign corporate shareholder can have the same general investment rights while still needing a heavier document file than a local shareholder.
Typical foreign-company evidence can include:
- current-status/activity records;
- constitutional documents;
- signatory/authority evidence;
- board/shareholder resolutions approving the Turkish investment;
- representative appointment and power of attorney;
- apostille or Turkish consular legalisation depending on country/document;
- sworn Turkish translation and notarial formalities where required.
Equal treatment concerns investment rights; it does not remove the need to prove the existence and authority of a foreign legal entity.
Can Profits and Dividends Be Transferred Abroad?
The FDI Law provides for transfer abroad of categories including net profits, dividends and proceeds from the sale or liquidation of investments through banks or special financial institutions.
That principle should not be marketed as “money can always be sent abroad without conditions.” In practice, transfers remain subject to:
- Turkish tax treatment and withholding where applicable;
- bank KYC/AML controls;
- supporting corporate/accounting documents;
- sanctions and correspondent-bank controls;
- payment purpose and currency/transaction documentation.
For corporate transfer mechanics, see How Companies Send Money Abroad from Turkey.
Does Foreign Investment Automatically Create Tax Incentives?
No. Foreign ownership by itself does not create a universal tax discount, grant or incentive.
Incentives depend on the investment, sector, location, export/service-export model, R&D/technology status, investment certificate or other specific programme conditions. A company should evaluate incentives separately from its right to invest.
Do not describe every foreign-owned company as eligible for tax benefits simply because it falls under the FDI framework.
Does FDI Status Give the Founder a Residence or Work Permit?
No. Company ownership, foreign-investor status, residence permission and work authorisation are separate legal matters.
A foreign founder who will actively work in Türkiye must evaluate the applicable work-permit route and current criteria. A residence permit is not a substitute for work authorisation.
See Work Permit for Company Owners in Turkey.
Workon coordinates foreign-investor company setup and connected operational steps according to the agreed scope.
Sector-Specific Rules Still Matter
The FDI Law itself recognises that special laws can create exceptions to the general investment-freedom and national-treatment principles.
Before formation, check whether the planned business requires:
- a specific legal form;
- minimum capital above the general company-law threshold;
- regulatory approval;
- foreign ownership limits;
- licenced managers/directors or qualified personnel;
- activity-specific premises;
- product or operating licences.
This is particularly important in regulated financial services, media, aviation, maritime, healthcare, education, telecom and other controlled activities.
What the FDI Framework Means for a Foreign Parent Company
An overseas company can generally choose between establishing a separate Turkish subsidiary or operating through a registered branch, subject to the actual activity and sector rules.
| Route |
Core FDI implication |
| Turkish subsidiary |
Foreign parent owns shares in a separate Turkish legal entity |
| Branch |
Foreign parent operates in Türkiye through a registered extension of the same legal entity |
| Acquisition |
Foreign investor acquires shares in an existing Turkish company, subject to sector/transaction rules |
| Liaison office |
Non-commercial representative presence subject to Ministry authorization; not a vehicle for ordinary commercial activity |
Foreign Investor Due-Diligence Checklist Before Entry
- Is the sector open to the planned level of foreign ownership?
- Does the activity require a JSC, special capital or regulator approval?
- Subsidiary, branch or acquisition?
- What foreign parent documents are required?
- How will profits/dividends be distributed and documented?
- Which tax treaty or investment treaty may be relevant?
- Will foreign personnel work in Türkiye?
- What banking/KYC evidence will the transaction flow require?
- Does the business need a specific premises or licence?
- Which incentive programmes are actually relevant to the investment—not merely to foreign ownership?
How Workon Supports Foreign-Investor Market Entry
Workon is an Istanbul-based business setup, workspace and operational coordination platform supporting foreign founders, investors and overseas companies entering Türkiye. Depending on the agreed scope, Workon coordinates company/subsidiary/branch setup, registered address and workspace, foreign-document and PoA workflows, bank-account application preparation, licensed CPA onboarding coordination, work/residence-permit coordination and related operating requirements.
Regulated legal, tax, accounting, customs and other professional work is handled by appropriately licensed professionals. Banks, regulators and public authorities retain their own approval powers.
Review Workon’s company registration and operational coordination service.
Official Reference Points
Last reviewed: September 2026. This guide provides general information on Türkiye’s foreign-investment framework and does not replace case-specific legal, tax, treaty or regulatory advice.
Frequently Asked Questions
Generally yes. A foreign individual or foreign company can generally own 100% of a Turkish capital company without a Turkish shareholder solely because of nationality, but regulated or strategic sectors can impose special ownership, capital, licence or approval rules.
No. Equal investment rights do not remove the need to prove a foreign legal entity's existence, authority and corporate approval. Foreign corporate shareholders can require current-status records, constitutional documents, resolutions, apostille or consular legalisation, Turkish translation and powers of attorney depending on the case.
The FDI framework generally allows transfer abroad of net profits, dividends and certain investment proceeds through banks or financial institutions, but tax treatment, withholding, KYC and AML, sanctions, accounting evidence and payment-purpose documentation still apply.
No. Incentives depend on the specific programme, activity, project, location and conditions. Residence and work authorisation are also separate from company ownership or FDI status and must be assessed under their own rules.
Check sector restrictions, legal form and capital, subsidiary versus branch or acquisition, foreign-document requirements, tax and treaty issues, banking and KYC, foreign personnel, premises and licences, and only the incentive programmes that actually fit the investment. Also assign ownership for the recurring FDI reporting that applies after entry, including the annual E-TUYS EK-1 activity filing by the end of May for covered companies and branches and the separate annual EK-4 route for liaison offices.
