Turkey offers a dynamic environment for international business partnerships, particularly through joint ventures. Setting up a joint venture (JV) in Turkey is a strategic way for foreign investors to enter the market, share resources, and mitigate risks while complying with Turkish Commercial Law.
What is a Joint Venture in Turkey?
A joint venture is a business collaboration between two or more parties, often formalized through a separate legal entity or a contractual agreement. In Turkey, joint ventures typically take the form of Limited Liability Companies (LLCs) or Joint Stock Companies (JSCs).
Legal Framework and Company Structures
- Limited Liability Company (LLC): Popular for small-to-medium ventures. Requires at least one shareholder and one director.
- Joint Stock Company (JSC): Preferred for large-scale investments. Allows share transfers and public offerings.
- Contractual JV: A less formal structure governed by the Turkish Code of Obligations, ideal for project-based collaborations.
Key Legal Considerations
- Shareholder Agreement: Crucial for defining profit sharing, decision-making authority, exit strategies, and dispute resolution mechanisms.
- Due Diligence: Ensure your prospective partner complies with tax, labor, and regulatory obligations.
- Capital Requirements: Minimum capital requirements apply depending on the type of company formed.
- Foreign Ownership: Turkey allows 100% foreign ownership, but sector-specific restrictions may apply (e.g. energy, media).
Benefits of Forming a Joint Venture in Turkey
- Shared financial and operational risks
- Access to local market knowledge and networks
- Resource pooling for technology and infrastructure
- Compliance with local ownership requirements in regulated industries
How ER&GUN&ER Law Firm Can Help
Our firm provides expert legal counsel on forming and managing joint ventures in Turkey. From drafting shareholder agreements to registering your company and ensuring compliance with Turkish law, our team of experienced Turkish business lawyers is here to support your strategic growth.
To explore joint venture opportunities in Turkey, contact our legal team today.
Read our previous article: Buying Commercial Property in Turkey