Turkish business and commercial law is codified primarily in the Turkish Commercial Code (Türk Ticaret Kanunu, TTK, Law No. 6102), which governs the formation and operation of commercial entities, share transfers, corporate governance, commercial contracts, and commercial enforcement mechanisms — and the Turkish Code of Obligations (Türk Borçlar Kanunu, TBK, Law No. 6098), which governs the general law of contracts applicable to commercial relationships not specifically addressed by the TTK. For foreign investors and international companies operating in Turkey, both statutes create mandatory provisions that cannot be contractually excluded — including mandatory corporate governance requirements for joint stock companies (anonim şirket, AŞ) and limited liability companies (limited şirket, Ltd. Şti.), mandatory general assembly procedures, mandatory auditor appointment thresholds, and mandatory contract law provisions protecting certain categories of counterparty. Understanding which provisions are mandatory versus default (which parties can modify by agreement) is essential for any commercial contract or corporate structure in Turkey, because a Turkish court will apply mandatory provisions regardless of what the contract says, and a structure that violates mandatory provisions is legally invalid to that extent. The Turkish Competition Authority (Rekabet Kurumu) also applies merger control rules that require notification for qualifying transactions — an M&A that closes without required Competition Authority approval creates significant legal risk for both parties. The Turkish Trade Registry Gazette (Türkiye Ticaret Sicili Gazetesi) is available at ticaretsicil.gov.tr. This guide explains how we work across the main categories of Turkish business and commercial law representation.
Company formation and corporate structuring
A lawyer in Turkey advising on the choice between a limited liability company (Ltd. Şti.) and a joint stock company (AŞ) under the TTK must explain that the two entity types differ in ways that are commercially significant for most businesses. The Ltd. Şti. has a minimum capital requirement of 10,000 TRY (as of current legislation, subject to adjustment by Council of Ministers decision), a maximum of 50 shareholders, shares that can only be transferred with the approval of the other shareholders (subject to the articles of association), and a simpler governance structure with fewer mandatory formalities. The AŞ has a minimum capital requirement of 50,000 TRY, no ceiling on shareholder numbers, freely transferable shares (unless restricted in the articles of association), and is subject to the TTK's more extensive governance requirements including mandatory general assembly procedures, auditor appointment for qualifying companies, and financial statement preparation and disclosure obligations. For companies expecting external investment, multiple shareholders, or eventual listing or sale, the AŞ structure is typically preferable. For small and medium businesses with stable ownership and no external financing needs, the Ltd. Şti. provides adequate protection with lower administrative burden. Practice may vary by authority and year — verify current TTK minimum capital requirements and the specific mandatory governance provisions applicable to each entity type before recommending any corporate structure for a Turkish business operation.
An Istanbul Law Firm advising on branch versus subsidiary for foreign companies entering Turkey must explain that a foreign company operating in Turkey through a branch (şube) is taxed in Turkey only on the branch's Turkish-source income — but the foreign parent company is directly liable for all of the branch's obligations without the liability limitation that a separate Turkish subsidiary would provide. A Turkish subsidiary (whether AŞ or Ltd. Şti.) is a separate legal person — its liabilities are generally limited to the subsidiary's own assets, with the foreign parent's liability limited to its share capital contribution (subject to limited piercing-the-veil doctrines for abuse). For foreign companies entering Turkey for a specific project, an individual business, or regulated activities where a branch structure is legally required, branch registration through the Trade Registry (with the parent company's notarized and apostilled corporate documents) is the practical approach. For foreign companies seeking to establish a permanent Turkish presence with commercial operations, a Turkish subsidiary provides the liability separation and the appearance of local establishment that many Turkish counterparties and government authorities prefer. We advise foreign companies on the branch versus subsidiary decision in the context of their specific sector, liability exposure, tax considerations, and local business relationship needs. Practice may vary — verify current Turkish Trade Registry requirements for branch registration and the specific sector regulations applicable to the company's Turkish activities before selecting the branch or subsidiary structure.
A law firm in Istanbul advising on joint venture (ortak girişim) structures in Turkey must explain that Turkish joint ventures are typically structured either as a contractual joint venture (where two or more parties collaborate under a partnership agreement without creating a new legal entity, sharing revenues and obligations under the agreement) or as a joint venture company (where the parties establish a new Turkish legal entity — typically an AŞ with defined shareholdings — to conduct the joint activity). Contractual joint ventures are common in construction, project finance, and public tender contexts where the parties need to demonstrate collective qualifications to bid. Corporate joint ventures are used where the activity is ongoing, where external financing is required, or where the liability separation of a legal entity is commercially important. The TTK's provisions on corporate governance apply fully to joint venture AŞ structures — including the deadlock resolution mechanisms (or lack thereof) in the shareholders' agreement, which must be specifically addressed because the TTK does not provide a statutory deadlock resolution mechanism for closely-held companies. We draft joint venture agreements with specific attention to governance, deadlock, exit, and step-in rights — because these are the provisions that determine whether a joint venture can survive commercial or personal disagreements between the founding parties. Practice may vary — verify current TTK joint venture company governance requirements and the specific Competition Authority notification thresholds applicable to the joint venture's market activity before finalizing any joint venture structure in Turkey.
Articles of association drafting and corporate governance
An English speaking lawyer in Turkey advising on articles of association (esas sözleşme) for Turkish companies must explain that the TTK provides a mandatory template for articles of association that covers the minimum required provisions — but for most companies with multiple shareholders or with specific governance needs, the mandatory template is inadequate, and the articles of association should be specifically drafted to address the company's actual ownership, control, and decision-making requirements. Key provisions that differ significantly from the TTK's defaults and that must be specifically drafted include: share transfer restrictions (the TTK's default for Ltd. Şti. requires existing shareholders' approval for any transfer, but the specific approval mechanism, the right of first refusal process, and the deemed consent timeline all need to be defined); supermajority voting requirements for major decisions (the TTK sets default majority requirements for general assembly and board decisions, but the parties may agree higher thresholds for decisions like capital increase, asset sale, or new business lines); and board appointment rights (which specific shareholders hold the right to nominate board members, and the consequences if a nominee is not elected). Practice may vary — verify current TTK mandatory articles of association provisions and the specific default rules that apply if the articles do not address a particular governance question before drafting any Turkish company's constitutional documents.
A Turkish Law Firm advising on shareholders' agreements for Turkish companies must explain that a shareholders' agreement (pay sahipleri sözleşmesi or hissedarlar sözleşmesi) supplements the articles of association by providing detailed governance provisions that the parties prefer to keep confidential (because the articles of association are publicly filed with the Trade Registry while the shareholders' agreement is not). Key provisions typically addressed in a shareholders' agreement include: share transfer restrictions more detailed than the articles (including drag-along and tag-along rights, right of first refusal terms, and transfer valuation mechanisms); anti-dilution protections for minority shareholders; information rights and audit rights beyond the statutory minimum; deadlock resolution mechanisms (including right to buy or sell at defined valuation, or right to put the company up for sale); and exit mechanisms (including a defined timeline for an IPO or trade sale exit if the parties cannot agree on a self-liquidating basis). The shareholders' agreement must be consistent with the articles of association — provisions in the shareholders' agreement that contradict the articles create a legal conflict that the TTK resolves in favor of the articles. We draft Turkish shareholders' agreements that are internally consistent with the articles and that include practical enforcement mechanisms for the main governance provisions. Practice may vary — verify current Turkish court approach to shareholders' agreement enforcement and the specific TTK mandatory provisions that override shareholders' agreement terms before finalizing any shareholders' agreement for a Turkish company.
A lawyer in Turkey advising on mandatory general assembly and board procedures must explain that the TTK imposes specific mandatory procedural requirements for general assembly (genel kurul) and board of directors (yönetim kurulu) meetings of Turkish companies — and failure to comply with these procedures can result in general assembly or board decisions being declared invalid by a Turkish court upon challenge. Key mandatory requirements for AŞ general assemblies include: the obligation to give statutory advance notice of the meeting (at minimum two weeks for ordinary general assemblies); the mandatory agenda requirement (the general assembly can only decide on matters on the notified agenda, with limited exceptions); the mandatory meeting documentation (minutes must be prepared and signed by the presiding officer and inspectors); and the statutory quorum and majority requirements for specific decisions (certain decisions require a qualified majority or qualified quorum that cannot be reduced below the TTK minimum in the articles of association). For Ltd. Şti. companies, the general assembly requirements are somewhat less burdensome but the meeting documentation and agenda requirements still apply. We advise Turkish companies on TTK-compliant general assembly and board procedures, prepare meeting documentation, and represent companies in general assembly decision challenges before Turkish commercial courts. Practice may vary by authority and year — verify current TTK mandatory general assembly and board procedures and the specific notice, quorum, and majority requirements applicable to the decision type before relying on any general assembly or board decision in a Turkish commercial context.
Commercial contract drafting and review
An Istanbul Law Firm advising on Turkish commercial contract drafting must explain that the TBK creates a framework of mandatory provisions that limit the parties' contractual freedom in specific areas — and a commercial contract that violates these mandatory provisions is void to that extent, regardless of the parties' agreement. Key mandatory TBK provisions affecting commercial contracts include: the prohibition on penalty clauses (cezai şart) in certain contexts and the TBK's limitation that courts can reduce disproportionate penalties regardless of the parties' agreement; the TBK's limitation on exclusion of liability for intentional conduct and gross negligence; the TBK's provisions on commercial leases and distribution agreements that impose specific restrictions on termination rights; and the TBK's provisions on agency and commission agency relationships that create statutory indemnification rights. For international commercial contracts that choose Turkish law as the governing law, these mandatory provisions apply and can affect the enforceability of clauses that would be valid under other legal systems. Practice may vary — verify current TBK mandatory contract provisions applicable to the specific contract type and the specific parties' relationship before finalizing any Turkish commercial contract that deviates from TBK default rules.
A law firm in Istanbul advising on specific commercial contract types must explain that distribution agreements, franchise agreements, and agency agreements in Turkey each attract specific legal considerations that go beyond the general TBK contract framework. For distribution agreements, the termination of a long-term distributorship where the distributor has invested in building the market can trigger Turkish court awards of compensation for goodwill contributions that the agreement did not specifically provide for — particularly where the agreement was for an indefinite term or where the distributor's contribution to market development is documentable. For franchise agreements, the TTK's disclosure requirements for certain franchise arrangements must be met before the contract is signed. For agency agreements, the TBK's commercial agent indemnification provisions create mandatory termination compensation rights that cannot be waived in advance. We draft distribution, franchise, and agency agreements with specific attention to the provisions that Turkish courts have found inadequate in disputes — particularly termination provisions, compensation mechanisms, and post-termination restraints. Practice may vary by authority and year — verify current Turkish court approach to distributor goodwill compensation and the specific TTK franchise disclosure requirements applicable to the arrangement before finalizing any distribution, franchise, or agency agreement for the Turkish market.
An English speaking lawyer in Turkey advising on governing law and forum selection in international commercial contracts involving Turkish parties must explain that Turkish courts apply Turkish law as the mandatory governing law for certain categories of Turkish commercial relationship — including employment contracts performed in Turkey, consumer contracts with Turkish consumers, and real estate contracts for Turkish property — regardless of the parties' contractual choice of foreign law. For commercial contracts that do not fall within these mandatory categories, the parties can validly choose foreign law as the governing law of the contract under Turkish Private International Law (MÖHUK), and Turkish courts will apply that chosen law. However, even where foreign law governs the contract, Turkish courts may apply Turkish mandatory rules (emredici normlar) that override the foreign law's position on specific points — including rules protecting Turkish parties in consumer, employment, and competition law contexts. Forum selection clauses choosing foreign courts or international arbitration are generally enforceable in Turkish commercial contracts, and Turkish courts will stay their proceedings in favor of agreed arbitration. We advise international companies on governing law and forum selection in Turkish commercial contracts — identifying which choices are legally permissible, which are subject to Turkish mandatory law override, and which forum provides the most efficient enforcement path given the likely dispute scenario. Practice may vary — verify current MÖHUK governing law choice provisions and the specific Turkish mandatory rules that may override chosen foreign law before finalizing any governing law or forum selection clause in a Turkish commercial contract.
Commercial disputes and mandatory mediation
A Turkish Law Firm advising on Turkish commercial court litigation must explain that since 2019, Turkish commercial court litigation is subject to mandatory commercial mediation (ticari uyuşmazlıklarda arabuluculuk) — which means that a claimant cannot file a commercial lawsuit before first applying for mediation and obtaining either a successful settlement or a mediation failure certificate (son tutanak). A commercial court filing that is made without the prior mediation application will be rejected by the court as procedurally deficient. The mediation application is made to the court-annexed mediation center (arabuluculuk bürosu) in the court district where the lawsuit would be filed, and the mediation session must take place within three weeks of the mediator's appointment. If mediation fails, the claimant can file the lawsuit immediately after receiving the failure certificate. The mandatory mediation step — while primarily a pre-litigation requirement — is also an opportunity for settlement at lower cost and earlier than full litigation, and the quality of the legal position presented in mediation affects both the settlement prospects and the strategic positioning for subsequent litigation if mediation fails. We advise clients on mediation strategy — specifically on how much to reveal in mediation about the legal and evidentiary position — before each mediation session. Practice may vary — verify current mandatory commercial mediation scope and the specific mediation procedural requirements applicable to the claim type and value before initiating any commercial dispute resolution process in Turkey.
An Istanbul Law Firm advising on commercial court proceedings in Turkey must explain that Turkish commercial courts (Asliye Ticaret Mahkemesi) apply the Civil Procedure Code (HMK) with specific adaptations for commercial matters — including the shorter response deadlines and the requirement for the parties to file their evidence simultaneously with their initial pleadings (the dilekçeler aşaması, petition stage), after which introducing new evidence requires the court's permission. This evidence simultaneity requirement means that a Turkish commercial court claimant must have its complete evidence package assembled before filing — not just the contract and the invoice, but the full documentary record supporting every element of the claim. A claimant who files without complete evidence and then attempts to add critical documents later faces significant procedural obstacles. Turkish commercial courts also appoint bilirkişi (court experts) for technical and financial disputes — and the bilirkişi's report is frequently determinative of the court's judgment, making the quality of the technical evidence and expert analysis submitted to the bilirkişi as important as the legal arguments in the pleadings. We prepare commercial court claims with the complete evidence package assembled before filing and with specific attention to the questions that the court will refer to the bilirkişi. Practice may vary by authority and year — verify current HMK evidence simultaneity requirements and the specific commercial court bilirkişi appointment procedures applicable to the claim type before filing any Turkish commercial court lawsuit.
A lawyer in Turkey advising on precautionary injunctions and attachments in Turkish commercial disputes must explain that Turkish civil procedure provides two key interim measures for commercial claimants: precautionary attachment (ihtiyati haciz) — which secures a monetary claim by attaching the defendant's assets before judgment; and precautionary injunction (ihtiyati tedbir) — which preserves the status quo by prohibiting a specific act (for example, preventing the defendant from disposing of assets, from performing a specific action, or from continuing a specific infringement). Both measures require a caution bond from the applicant and a showing of probable success on the merits and urgency (that the right cannot be protected by the eventual judgment without the interim measure). Applications for both are typically decided ex parte within days of filing. For commercial claimants who have reason to believe the defendant will dissipate assets or close the business before a judgment can be obtained, precautionary attachment provides effective leverage — particularly for attaching bank accounts, which Turkish enforcement offices can execute rapidly. We prepare precautionary attachment and injunction applications simultaneously with or before the main lawsuit filing in cases where asset dissipation risk is present. Practice may vary — verify current Turkish court caution bond calculation standards and the specific urgency showing required for precautionary attachment and injunction applications in commercial cases before applying for any precautionary measure.
Mergers, acquisitions, and corporate transactions
An English speaking lawyer in Turkey advising on Turkish M&A must explain that a Turkish company acquisition can be structured either as a share purchase (where the buyer acquires shares in the target company, taking on all existing liabilities) or an asset purchase (where the buyer acquires specific assets and liabilities of the target business, avoiding unwanted liabilities). Share purchases are more common in Turkish M&A because they are simpler to execute (requiring registration of the share transfer with the Trade Registry rather than transfer of each individual asset) and more tax-efficient in many cases — but asset purchases are preferable where the target has significant undisclosed or contingent liabilities, pending litigation, or regulatory violations that the buyer wants to leave behind. For a share purchase, the key legal document is the Share Purchase Agreement (SPA), which will include representations and warranties by the seller about the company's condition, indemnification provisions, and purchase price adjustment mechanisms. For asset purchases, the key documents include the Asset Transfer Agreement and the specific transfer instruments for each category of asset (real estate, IP, contracts, licenses). Practice may vary — verify current Turkish Trade Registry share transfer registration procedures and the specific tax treatment applicable to share versus asset acquisitions in Turkey before recommending any transaction structure.
A Turkish Law Firm advising on M&A due diligence in Turkey must explain that Turkish M&A due diligence covers the same broad categories as international M&A due diligence — corporate legal status, financial statements, material contracts, employment and social security compliance, intellectual property, real estate, environmental, tax, and litigation — but with specific Turkish law considerations in each category that differ from the due diligence findings in other jurisdictions. Key Turkish-specific due diligence risks include: SGK premium arrears (which are attached to the employing entity and are the buyer's problem in a share deal); undisclosed liens and encumbrances on assets registered in the Turkish Land Registry, trade registry, or vehicle registry; labor law contingent liabilities from collective redundancies, wrongful termination claims, or unpaid overtime that are common in Turkish labor disputes; and tax authority audit risks for companies that have taken aggressive positions on deductible expenses, transfer pricing, or VAT. For targets with regulatory licenses, due diligence must also confirm the license's transferability in the contemplated transaction structure. Practice may vary — verify current Turkish labor law contingent liability calculation standards and the specific Turkish tax audit risk profile applicable to the target's industry and transaction history before assessing any Turkish M&A due diligence finding.
A lawyer in Turkey advising on Turkish Competition Authority (Rekabet Kurumu) merger control must explain that the Turkish Competition Authority applies merger control rules that require notification for acquisitions and mergers above defined financial thresholds — and a transaction that exceeds the thresholds must be notified to and approved by the Competition Authority before closing. The notification thresholds under the Law on the Protection of Competition (Law No. 4054) are defined in terms of combined Turkish turnover of the parties and, for certain sectors, world turnover of the target. A transaction that closes without the required Competition Authority approval (a "gun-jumping" violation) is subject to significant administrative fines and — in principle — the transaction itself may be declared legally ineffective. The Competition Authority's review process takes a minimum of 15 calendar days for Phase 1 clearance (for non-problematic transactions) and up to several months for Phase 2 investigations (for transactions that raise competition concerns). We assess Competition Authority notification requirements as part of every Turkish M&A transaction, because the review timeline directly affects the deal's closing schedule. Practice may vary by authority and year — verify current Turkish Competition Authority notification thresholds and the specific sectors subject to lower thresholds or sector-specific review before assessing any Turkish M&A's Competition Authority notification obligation.
Debt collection and commercial enforcement
An Istanbul Law Firm advising on debt collection in Turkey must explain that Turkish debt collection proceeds through a specific legal framework — the Enforcement and Bankruptcy Law (İcra ve İflas Kanunu, İİK) — that provides several distinct collection pathways depending on the nature of the debt and the documents available to the creditor. For claims based on documents bearing the debtor's signature that create an undisputed obligation (such as negotiable instruments, promissory notes, or cheques), the creditor can use the İİK's faster "enforcement without judgment" (ilamlı veya ilamsız icra) procedure — which allows the creditor to directly order the enforcement office to initiate execution proceedings against the debtor without first obtaining a court judgment. For commercial contract debts not evidenced by a negotiable instrument, the creditor typically uses the ordinary enforcement procedure — the enforcement office sends a payment order to the debtor, and if the debtor objects, the creditor must then obtain a court judgment confirming the debt before execution can proceed. Practice may vary — verify current İİK enforcement procedure requirements and the specific document authentication requirements for negotiable instrument enforcement before selecting the appropriate collection pathway for a Turkish commercial debt.
A law firm in Istanbul advising on asset attachment and enforcement in Turkey must explain that Turkish enforcement proceedings allow creditors to attach and execute against a broad range of debtor assets — including bank accounts (the most effective and fastest tool in Turkish commercial enforcement, because Turkish banks execute attachment orders on the day of service), real estate (through the Land Registry), vehicles (through the traffic registry), and receivables from third parties. The effectiveness of enforcement depends heavily on having accurate intelligence about where the debtor's assets are located — a Turkish enforcement proceeding that is directed at assets the debtor has already transferred or concealed before the proceeding is initiated will not produce recovery. For creditors who have reason to believe the debtor is taking steps to dissipate assets, a precautionary attachment application (ihtiyati haciz) filed before or simultaneously with the enforcement proceeding can freeze assets immediately. Turkish enforcement offices operate efficiently for bank account attachments — providing rapid security for creditors who move promptly after a debt becomes due. Practice may vary by authority and year — verify current İİK asset attachment procedures and the specific execution timeline for bank account versus real estate attachments in the relevant enforcement office district before planning any Turkish commercial debt collection strategy.
An English speaking lawyer in Turkey advising on cheque and promissory note enforcement in Turkey must explain that cheques (çek) and promissory notes (bono/senet) are among the most powerful debt collection instruments in Turkish commercial practice — because the holder of a dishonored cheque or a matured promissory note can file directly in the enforcement office for "enforcement without judgment" (ilamsız icra) without first obtaining a court judgment, and the debtor has a limited 5-day window to object to the payment order before the enforcement office can proceed with asset attachment. Cheque fraud is also a criminal offense under the Cheque Law — a dishonored cheque issued by a representative of a Turkish company can trigger criminal liability for the individual representative alongside the civil enforcement proceedings. For creditors who have accepted cheques or promissory notes as security for a Turkish commercial transaction, understanding the Turkish negotiable instrument enforcement process is commercially important — because the enforcement is significantly faster than contract-based debt collection. We advise creditors on cheque and promissory note security mechanics and manage enforcement proceedings in Turkish enforcement offices. Practice may vary — verify current Turkish Cheque Law enforcement procedures and the specific İİK response deadline applicable to payment orders based on negotiable instruments before initiating any cheque or promissory note enforcement action in Turkey.
Commercial arbitration — Turkish domestic and international
A Turkish Law Firm advising on Turkish domestic arbitration must explain that Turkish domestic arbitration is governed by the Turkish Code of Civil Procedure's arbitration chapter (HMK Articles 407–444) for domestic disputes — where both parties are Turkish nationals or both have their place of business in Turkey — and by the Turkish International Arbitration Law (Milletlerarası Tahkim Kanunu, Law No. 4686) for international disputes. Domestic arbitration under the HMK is available for any commercial dispute that the parties can freely dispose of — most commercial contract disputes qualify, with the exception of disputes involving mandatory Turkish law provisions that cannot be derogated from by the parties. Turkish domestic arbitration awards are enforced through Turkish enforcement offices without a separate recognition procedure (unlike foreign arbitral awards which require tenfiz recognition). For Turkish commercial parties who want the benefits of arbitration (confidentiality, party autonomy in arbitrator selection, procedural flexibility) without the cost of international arbitration, ISTAC's domestic arbitration rules provide a structured institutional framework that is increasingly used. Practice may vary — verify current HMK domestic arbitration eligibility criteria and the specific ISTAC domestic arbitration procedural rules before selecting domestic arbitration as the dispute resolution mechanism for a Turkish commercial contract.
An Istanbul Law Firm advising on the Istanbul Arbitration Centre (ISTAC) as a venue for Turkey-related international disputes must explain that ISTAC, established in 2015 under Turkish law, provides a neutral, internationally recognized arbitral institution based in Istanbul — combining the geographic proximity advantage for Turkish parties with the New York Convention enforcement advantage of a properly conducted international arbitral award. ISTAC's rules are modeled on international best practice (comparable to ICC and LCIA rules), providing for tribunal constitution, documentary exchange, hearing procedures, and emergency arbitrator mechanisms that meet the expectations of sophisticated international commercial parties. An ISTAC award made in proceedings where international arbitration rules apply (rather than domestic arbitration rules) is a foreign arbitral award for enforcement purposes in non-Turkish jurisdictions, giving it the New York Convention enforcement network that a Turkish court judgment would not automatically provide. We draft ISTAC arbitration clauses for Turkish commercial contracts and represent parties in ISTAC proceedings — from initial filing and arbitrator challenges through the final award and enforcement. Practice may vary — verify current ISTAC procedural rules and the specific enforcement status of ISTAC awards under the New York Convention in the relevant enforcement jurisdiction before recommending ISTAC as the arbitral institution for any Turkish commercial contract.
A lawyer in Turkey advising on ICC arbitration for Turkish commercial disputes must explain that ICC arbitration (under the International Chamber of Commerce Rules) is the most commonly chosen international arbitration framework for high-value commercial contracts with Turkish parties — particularly in the energy, construction, and M&A sectors. The ICC's Terms of Reference procedure, the ICC Court's active case management, and the scrutiny of draft awards by the ICC Court before their issue provide procedural quality assurance that makes ICC awards more resistant to enforcement challenges. ICC arbitrations seated in Turkey are governed by Turkish arbitration law for procedural matters (annulment standards, interim measures from Turkish courts) while the substantive law governing the dispute is the chosen governing law. ICC arbitrations seated abroad (Paris, Geneva, London) with Turkish parties are more insulated from Turkish court interference during the proceedings but require a tenfiz recognition proceeding in Turkey for enforcement against Turkish-domiciled assets. We represent Turkish and international parties in ICC arbitrations involving Turkish commercial disputes, from seat selection and governing law strategy through the proceedings to award enforcement. Practice may vary — verify current ICC arbitration rules and procedures and the specific Turkish court stance on ICC award enforcement through tenfiz before recommending ICC arbitration for any Turkish commercial contract. The Istanbul Bar Association at istanbulbarosu.org.tr provides resources for identifying qualified practitioners.
Regulatory compliance and sector-specific licensing
An English speaking lawyer in Turkey advising on sector-specific regulatory licensing must explain that many Turkish commercial activities require sector-specific permits or licenses in addition to the general Trade Registry registration — and operating without the required license creates both administrative liability and, in some sectors, criminal liability for the company's directors. Key regulated sectors include: financial services (banking and payment institutions regulated by BDDK); insurance (regulated by SEDDK); energy (regulated by EPDK); media and broadcasting (regulated by RTÜK); telecommunications (regulated by BTK); healthcare and pharmaceuticals (regulated by the Ministry of Health and TİTCK); and food and beverage (regulated by the Ministry of Agriculture). Each regulator has its own application requirements, capital thresholds, personnel qualification requirements, and ongoing compliance obligations. A company that structures its Turkish operations without confirming which sector-specific licenses apply — and obtaining them before commencing operations — faces the risk of enforcement action that forces it to cease operations while retroactively seeking licenses. Practice may vary by authority and year — verify current sector-specific regulatory licensing requirements applicable to the company's Turkish activities with the relevant sector regulator before commencing any regulated commercial activity in Turkey.
A Turkish Law Firm advising on KVKK (Personal Data Protection Law) compliance for Turkish businesses must explain that Turkish businesses — including foreign companies processing the personal data of Turkish individuals — are subject to the Law on Protection of Personal Data (Kişisel Verilerin Korunması Kanunu, KVKK, Law No. 6698) and the oversight of the Personal Data Protection Authority (Kişisel Verileri Koruma Kurumu, KVKK/KVK Kurumu). Key KVKK compliance obligations for Turkish businesses include: the obligation to register with the VERBİS (Veri Sorumluları Sicil Bilgi Sistemi) data controllers registry for qualifying companies; the obligation to prepare and publish privacy notices informing data subjects about processing; explicit consent requirements for certain sensitive data categories; data transfer restrictions for cross-border transfers outside Turkey; and mandatory data breach notification to the KVK Kurumu within 72 hours of discovery. Businesses that fail to implement KVKK compliance face administrative fines calculated per violation category, which have been enforced with increasing frequency. We advise Turkish businesses and foreign companies with Turkish data processing operations on KVKK compliance — including VERBİS registration, privacy notice preparation, data transfer mechanisms, and data breach response procedures. Practice may vary — verify current KVK Kurumu VERBİS registration requirements and the specific KVKK obligations applicable to the company's Turkish data processing activities before designing any data protection compliance program.
A lawyer in Turkey advising on e-commerce regulatory compliance in Turkey must explain that the Turkish e-commerce market is governed by the Law on Regulation of Electronic Commerce (Elektronik Ticaretin Düzenlenmesi Hakkında Kanun, Law No. 6563) and its implementing regulation, which impose specific obligations on e-commerce service providers and electronic marketplaces operating in Turkey. Key obligations include: mandatory pre-contract disclosure to consumers including the provider's identity, the goods/services description, the total price, and the right of withdrawal; a 14-day right of withdrawal for consumers on distance contracts (with specific exceptions for digital content, customized goods, and perishables); specific invoicing and delivery documentation requirements; and — for electronic marketplace operators above defined annual transaction thresholds — registration with the Ministry of Trade's electronic commerce information system (ETBİS). The Turkish Consumer Protection Law (TKHK) also applies to e-commerce transactions and creates mandatory consumer protection provisions that cannot be contractually excluded. We advise Turkish and international e-commerce businesses on the complete Turkish regulatory framework applicable to their Turkish operations, including consumer protection, data privacy, and tax compliance. Practice may vary by authority and year — verify current Law No. 6563 disclosure requirements and the specific ETBİS registration threshold applicable to the company's Turkish e-commerce transaction volume before finalizing any Turkish e-commerce compliance framework. Practice may vary — check current guidance before acting on any information on this page.
Foreign investment and bilateral investment treaty protection
An Istanbul Law Firm advising on foreign direct investment (FDI) in Turkey must explain that Turkey has liberalized its foreign investment framework significantly since 2003 — foreign investors generally receive national treatment and can invest in most sectors on the same terms as Turkish investors, with specific exceptions in regulated sectors (banking, broadcasting, aviation) where foreign ownership caps or licensing requirements apply. Foreign investors are not required to obtain prior approval for their investment in most sectors — the company formation process through the Trade Registry is sufficient. However, sector-specific regulatory approvals (from BDDK, EPDK, SEDDK, etc.) may be required before the company begins operations, and certain land acquisitions by foreign nationals or foreign-owned companies may require reciprocity confirmation or military zone clearance. The investment legislation is codified in the Foreign Direct Investment Law (Doğrudan Yabancı Yatırımlar Kanunu, Law No. 4875), which provides the basic framework of national treatment and guarantees. Practice may vary — verify current sector-specific foreign ownership restrictions and the specific regulatory approval requirements applicable to the investment sector before structuring any foreign direct investment in Turkey.
A law firm in Istanbul advising on bilateral investment treaty (BIT) protection for foreign investors in Turkey must explain that Turkey has signed bilateral investment treaties with over 90 countries, providing foreign investors with substantive protections including fair and equitable treatment, protection against expropriation without compensation, national treatment, and — most importantly for dispute resolution — the right to submit investment disputes to international arbitration (ICSID, UNCITRAL, or ICC) rather than being required to litigate in Turkish courts. BIT arbitration has been used by foreign investors against Turkey in cases involving regulatory changes affecting the investment's profitability (particularly in the energy sector), expropriation of investments through regulatory or administrative action, and denial of justice in Turkish court proceedings. The availability of BIT arbitration means that foreign investors in Turkey have a dispute resolution option that bypasses the Turkish court system entirely for qualifying investment disputes — a significant commercial consideration for high-value investments in regulated sectors. We advise foreign investors on BIT availability, the scope of BIT protections, and the strategic use of BIT arbitration as an alternative to Turkish court litigation for qualifying investment disputes. Practice may vary — verify the current BIT between Turkey and the investor's home country, the specific protections available under that BIT, and the exhaustion of local remedies requirements (if any) before initiating any BIT arbitration proceeding against Turkey.
An English speaking lawyer in Turkey advising on investment incentive certificates (yatırım teşvik belgesi) must explain that Turkish investment law provides a system of investment incentives for qualifying investments — including corporate tax rate reductions, VAT exemptions on machinery and equipment, import customs duty exemptions, and land allocation — administered through the Ministry of Industry and Technology's incentive certificate system. Investment incentive certificates are issued for qualifying investments in designated investment regions and sectors, and the specific incentives available depend on the investment's region, sector, minimum investment amount, and employment creation commitment. For foreign investors making significant capital investments in Turkish manufacturing, energy, technology, or other prioritized sectors, the incentive certificate framework can provide substantial cost savings that affect the investment's return economics. The incentive certificate application is submitted to the Ministry of Industry and Technology, and the certificate must be obtained before the investment begins — retroactive certification is not available. We advise foreign investors on incentive certificate eligibility, application procedures, and compliance with the certificate's conditions (which typically require maintaining minimum employment levels and completing the investment within the committed timeframe). Practice may vary by authority and year — verify current Ministry of Industry and Technology incentive certificate eligibility conditions and the specific incentive package applicable to the investment's region and sector classification before committing to any investment structure designed around Turkish investment incentives.
How we work in business and commercial law mandates
A best lawyer in Turkey managing a business and commercial law mandate begins by identifying the legal framework applicable to the client's specific situation — the TTK's mandatory corporate governance provisions for a structuring mandate, the TBK's mandatory contract provisions for a commercial contract mandate, the Competition Authority's merger control thresholds for an M&A mandate, or the mandatory commercial mediation requirement for a dispute mandate. The practical starting point for any Turkish commercial engagement is the mandatory law inventory — because the client's commercial objectives can only be achieved within the constraints of the Turkish mandatory law framework, and a structure or contract that violates mandatory provisions creates legal risk that the client's commercial team may not have anticipated. For international clients, the additional dimension is identifying which Turkish mandatory law provisions apply despite the client's home jurisdiction framework — because international companies operating in Turkey cannot simply apply their home country's legal concepts and expect them to produce the same results in Turkey. We prepare a mandatory law briefing for new international clients at the outset of each engagement, to ensure that Turkish legal constraints are factored into commercial planning before any commitment is made.
ER&GUN&ER represents Turkish and international businesses in commercial law mandates — including company formation, articles of association drafting, shareholders' agreement negotiation, commercial contract drafting and review, M&A due diligence and transaction documentation, commercial disputes (mediation, commercial court litigation, and arbitration), debt collection and asset enforcement, regulatory licensing, and investment incentive certificate applications. We work in English throughout all international mandates and maintain current working knowledge of the TTK, TBK, Competition Authority merger control practice, and commercial court procedure across Istanbul, Ankara, İzmir, and other major Turkish commercial centers. For Turkish company formation and trade structure questions, see the resource on establishing a company in Turkey. For Turkish labor law questions relevant to employment compliance in Turkish commercial operations, see the resource on labor law Turkey. Practice may vary — check current guidance before acting on any information on this page.
Frequently Asked Questions
- What is the difference between a Limited Liability Company (Ltd. Şti.) and a Joint Stock Company (AŞ) in Turkey? The Ltd. Şti. has a lower minimum capital (10,000 TRY), maximum 50 shareholders, shares that require existing shareholder approval to transfer, and simpler governance formalities. The AŞ has a higher minimum capital (50,000 TRY), no shareholder ceiling, freely transferable shares, and is subject to more extensive mandatory governance requirements. Practice may vary — verify current TTK minimum capital requirements, as these are subject to Council of Ministers adjustment.
- Can foreign nationals own 100% of a Turkish company? Yes — in most sectors, foreign nationals can own 100% of a Turkish Ltd. Şti. or AŞ and receive national treatment under the Foreign Direct Investment Law (Law No. 4875). Sector-specific restrictions apply in banking, broadcasting, aviation, and certain other regulated sectors. Practice may vary — verify current sector-specific foreign ownership restrictions for the intended Turkish activity.
- What is mandatory commercial mediation in Turkey? Since 2019, a claimant in a commercial court case must first apply for commercial mediation before filing the lawsuit. The court will reject a direct filing without prior mediation. The mediation session must take place within three weeks of mediator appointment. If mediation fails, the claimant can file the lawsuit immediately after receiving the failure certificate.
- What documents are required for Turkish company formation? At minimum: the articles of association (executed before a notary or at the Trade Registry); shareholder and director identity documents; a Turkish tax identification number for foreign shareholders; proof of minimum capital deposit at a Turkish bank; and a potential location lease or ownership document. The Trade Registry also requires a Chamber of Commerce registration and sector-specific licenses for regulated activities. Practice may vary — verify current Trade Registry requirements for the specific entity type.
- What are the Competition Authority notification thresholds for Turkish M&A? The thresholds are defined in terms of combined Turkish turnover of the parties and in some sectors, world turnover of the target. The specific threshold amounts are set by Rekabet Kurumu regulation and have been adjusted multiple times. Practice may vary by authority and year — verify the current threshold amounts with the Rekabet Kurumu before assessing any Turkish M&A's notification obligation, as the thresholds change periodically.
- What is the bilirkişi and how does it affect Turkish commercial litigation? The bilirkişi (court expert) is appointed by the commercial court in disputes requiring technical or financial expertise — including contract interpretation questions, construction defect assessments, accounting disputes, and IP valuation. The bilirkişi's report is typically determinative of the court's judgment. Building the litigation strategy around the bilirkişi appointment — with supporting expert reports and specific framing of technical questions — is as important as the legal pleadings.
- Can a shareholders' agreement override the articles of association in Turkey? No — where a shareholders' agreement conflicts with the articles of association, Turkish law resolves the conflict in favor of the articles (which are the public document). A shareholders' agreement must be consistent with the articles of association. Provisions in the shareholders' agreement that the parties want to be enforceable in corporate governance terms must be reflected in (or at least not contradicted by) the articles.
- What is the mandatory mediation step for Turkish commercial court claims? Before any commercial court lawsuit is filed, the claimant must apply for mediation at the court-annexed mediation center and participate in the mediation session. Only after a mediation failure certificate is issued can the lawsuit be filed. The court will dismiss a lawsuit filed without a prior mediation application. The mediation step typically adds 3-6 weeks to the timeline before court filing is possible.
- Can foreign court judgments be enforced in Turkey? Yes — through the tanıma ve tenfiz (recognition and enforcement) procedure before Turkish civil courts, subject to MÖHUK conditions including reciprocity with the judgment country, finality of the judgment, and compliance with Turkish public order. Foreign arbitral awards benefit from New York Convention enforcement, which is generally more straightforward. Practice may vary — verify current Turkish court tenfiz requirements for the specific origin country.
- What is the right of first refusal in a Turkish Ltd. Şti.? Under the TTK, shares in a Turkish Ltd. Şti. cannot be transferred to a third party without the approval of the existing shareholders — and the articles of association can implement this through a right of first refusal (ön alım hakkı), requiring the transferring shareholder to first offer the shares to the existing shareholders at the proposed transfer price. The specific mechanics, notice period, and valuation methodology for the right of first refusal must be specifically defined in the articles, because the TTK's default provisions are not always workable in practice.
- What is KVKK and when does it apply to Turkish companies? KVKK (Kişisel Verilerin Korunması Kanunu, Law No. 6698) is Turkey's personal data protection law, applicable to any data controller processing personal data of Turkish individuals — including foreign companies with Turkish operations. Key obligations include VERBİS registry registration for qualifying companies, privacy notices, explicit consent for sensitive data, cross-border transfer restrictions, and 72-hour data breach notification. Fines are assessed per violation category by the KVK Kurumu.
- What are the termination indemnification rights of Turkish commercial agents? The TBK provides mandatory termination indemnification rights for commercial agents (acenteler) — the right to compensation for the commercial benefit the agent has created for the principal upon termination of the agency relationship. This right cannot be waived in advance and applies regardless of the contract's termination provisions. International companies terminating Turkish agent relationships must account for this mandatory obligation regardless of the contractual framework.
- What is the Turkish mandatory mediation requirement's scope? Mandatory commercial mediation applies to disputes subject to Turkish commercial court jurisdiction — which includes most commercial contract disputes, shareholder disputes, company law claims, negotiable instrument claims, and commercial tort claims. Consumer disputes in certain categories are subject to separate mandatory consumer arbitration. Employment disputes are subject to a separate mandatory mediation requirement under labor law. Practice may vary — verify current mandatory mediation scope for the specific claim type.
- Do you handle M&A due diligence for Turkish target companies? Yes — we conduct legal due diligence covering corporate legal status, material contracts, employment and SGK compliance, intellectual property, real estate and Land Registry records, pending litigation, tax audit risk, sector-specific licensing, and regulatory compliance. We prepare due diligence reports in English for international buyers and coordinate with the target's Turkish counsel and management on document provision.
- What are bilateral investment treaty (BIT) protections available to foreign investors in Turkey? Turkey has signed BITs with over 90 countries, providing foreign investors with fair and equitable treatment, expropriation protection, national treatment, and international arbitration rights (ICSID, UNCITRAL, ICC) for qualifying investment disputes. BIT arbitration allows foreign investors to bypass Turkish court litigation for qualified investment disputes. Practice may vary — verify the current BIT between Turkey and the investor's home country and the specific protections and dispute resolution provisions available under that BIT.
Author: Mirkan Topcu is an attorney registered with the Istanbul Bar Association (Istanbul 1st Bar), Bar Registration No: 67874. His practice focuses on cross-border and high-stakes matters where evidence discipline, procedural accuracy, and risk control are decisive.
He advises Turkish and international companies across Commercial Law, Corporate Law, M&A, Commercial Disputes, Regulatory Compliance, and Foreign Investment matters where Turkish mandatory law compliance and commercial enforceability are decisive.
Education: Istanbul University Faculty of Law (2018); Galatasaray University, LL.M. (2022). LinkedIn: Profile. Istanbul Bar Association: Official website.
