1-What is the first step to be taken in order to set up a Limited Liability Company (LLC)?
First step to be taken when embarked on forming a Limited Liability Company in Turkey is to prepare a Company Contract that contains information as to basic features of the company, the seat address, the amount of capital and the rules governing the sharing of profit. A Company Contract is deemed to be the constitution of a company. Articles of Association is the term often used for the Company Contract of Joint Stock Companies.
2-How can the founder/founders prepare a Company Contract?
The Company Contract may be drawn via MERSİS (Central Registry Number System). Under the section of “Company Formation”, the interface directs the users to fill in the legally required elements in the Company Contract. Once the whole necessary information are filled by the user, the system will put all the provided information together and the Contract will be automatically formed at the end.
3-How can a foreigner be added to the Company Contract as a partner despite the absence of a Turkish ID number?
Whereas the Turkish citizens can be added as partners to the Contract by their Turkish ID number, foreigners can only be added through their passport number provided that they obtained a tax number from the tax office and registered that number to the Trade Registry Office.
4-What does the founder/founders of an LLC (yet to be formed) have to do once the initial application to MERSİS is completed?
Once the application has been submitted for approval through MERSİS, the system assigns a Tracking Number to that single application. Afterwards, the partners shall date an appointment with the Trade Registry Office of the city where the company seat is located via the website thereof. At the date of appointment, the partners of the company (yet to-be formed) shall go to the Trade Registry Office with the Tracking Number assigned to them and sign the Company Contract. The signatures of the partners shall be authenticated by the authorized official at the Trade Registry Office afterwards.
5-What are the key differences between the formation procedures of a Joint Stock Company (JSC) and a Limited Liability Company (LLC) in Turkey?
Despite the differences at some aspects, the procedural steps to be followed for the formation of both type of company are in fact the same. Thresholds for the minimum amount of capital required by the law for each type of company and the legal requirement to deposit a quarter of cash capital in the bank account opened on behalf of the company prior to registration for forming a JSC constitute the main differences. Additionally, whereas the Turkish Commercial Code requires the appointment of a manager for setting up an LLC, there is no such requirement for forming a JSC.
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