Should a Foreign Company Open a Branch or a Liaison Office in Turkey?

Company Formation and Articles of Association

Prepared by: Constantinople

A branch and a liaison office are not merely different names for structures serving the same purpose. A liaison office may be opened with the necessary authorisation and on condition that it does not carry on commercial activities in Turkey. If sales, commercial contracts with customers or income generation in Turkey are planned, the operating model must be assessed accordingly. The choice should not be based solely on formation costs.

Prepare the parent company's formation documents and current evidence of activity, representation records, a description of the work to be carried out in Turkey and the authorisation document for the person to be appointed. Certification and Turkish translation requirements for foreign documents are checked according to the issuing country and intended procedure. Authority to lease offices, employ staff and sign contracts is not automatically unlimited within the same power of attorney; responsibilities must be clearly distinguished.

A branch, a separate company in Turkey and a liaison office have different liability, representation and administrative obligations. Regulated sectors may require additional authorisation. Completing formation does not automatically resolve a foreign director's work or residence status. Accounting and tax obligations must also be planned with the relevant specialists. This allows the chosen structure to be compared with the actual intended activity from the outset.

Explain the activity to be carried out in Turkey and who will invoice the customer. With the parent company's current representation documents, the branch, company and liaison office options can be compared.

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