If you are considering establishing a liaison office or branch in Turkey, here you can find the answers you're looking for.
Check back frequently on this page as we add new questions from time to time.
If the paperwork is complete, the processing times are 15-20 days for Liaison Office applications and 20-30 days for Branch applications.
In Turkey, employing foreign staff is subject to a few restrictions. In general, the foreign labor quota system - the rule of five Turkish employees for every foreign worker employed - is sought in work permit applications. One of the exceptions to this rule is the key personnel, as described in the Foreign Direct Investment Law.
The Regulation concerning foreign work permits within the scope of the Foreign Direct Investment Law defines key personnel as meeting at least one of the below-mentioned criteria.
- Being involved in senior management or executive positions
- Playing an active role in the management of the organization
- Supervising and checking the company's auditors, administrative or technical personnel
- Employing and/or dismissing personnel; or playing a role in the decision-making process
- Carrying a title such as company shareholder, chairman or member of the board of directors, general manager, associate general manager, company manager and similar positions
- Having the necessary knowledge on company products, services, technical know-how or management
- For Liaison Offices: one person who has been issued a letter of authorization by the principal company abroad, provided that USD 200,000 (or equivalence of foreign currency) has been brought from abroad within the last year of its activities.
Therefore, the maximum number of foreign personnel that may be employed by a Liaison Office under the regulation is 1.
No. The application for the extension and the relevant paperwork must be signed by the principal company abroad and supporting documents must be up to date.
As Liaison Offices must entirely be financed from abroad, the Ministry requires bank documents that show proof of transaction. In this context, the Ministry accepts 'DAB' (currency exchange receipts) and a letter which indicates:
- The cumulative funds sent from abroad
- The name and the country of incorporation of the principal company
- Transaction dates
We would be delighted to help your bank prepare this document in the required format.
Liaison Offices are not exempt from VAT. They have to pay VAT in their B2B (business to business) transactions. However, unlike other company types, they do not have to declare VAT transactions to the Tax Office.
The funds for Liaison Office operations must be transferred from abroad and must be in foreign currency. The parent company is not allowed to send TRY currency to its Liaison Office in Turkey. However, certain local expenses (such as food, gas, and rent) and the SSI premiums of employees must be paid in TRY currency. Therefore, in practice, Liaison Offices should have two separate bank accounts in Turkey: One for foreign currency and must be used for receiving fund transfers from abroad - and the other one should be in TRY currency which should be reserved for converting funds to TRY and making local payments. On the other hand, due to the law amended on 26/11/2019, Liaison Offices must have a public bank account for social security premiums and other tax payments if needed.
Please click here for the details of the relevant decision.