LLP is an alternative corporate business form that gives the benefits of limited liability of a company and the flexibility of a partnership. The LLP can continue its existence irrespective of changes in partners. It is capable of entering into contracts and holding property in its own name. The LLP is a separate legal entity, is liable to the full extent of its assets but liability of the partners is limited to their agreed contribution in the LLP. Further, no partner is liable on account of the independent or un-authorized actions of other partners, thus individual partners are shielded from joint liability created by another partner’s wrongful business decisions or misconduct. Mutual rights and duties of the partners within a LLP are governed by an agreement between the partners or between the partners and the LLP as the case may be. The LLP, however, is not relieved of the liability for its other obligations as a separate entity. Since LLP contains elements of both ‘a corporate structure’ as well as ‘a partnership firm structure’ LLP is called a hybrid between a company and a partnership.

Company Registration in Turkey |

Turkish Company Registration: An Overview

Turkey is a transcontinental nation situated between South Western Asia and Europe. This nation is renowned for its rich cultural history. It is very simple to register a company in Turkey, however it is crucial to follow local legal criteria. In Turkey, a business can be created with a minimum of one shareholder and director. A minimum of 10,000 Turkish Liras is needed to register a business in Turkey. In Turkey, a company can be incorporated without being present in person.

Overview

A business can be incorporated in the Turkish free trade zone by an investor seeking company registration in Turkey. There are many advantages to forming a business in this free zone. The government would provide various tax breaks and privileges for a business established in a free trade zone. In addition, an investor can return funds from the Turkish Free Trade Zone to their native country.

The government has liberalized regulations governing foreign investment, and the country is experiencing a boom in foreign investment. Turkey's economy is regarded as one of the world's ones that is rapidly developing. This nation is the second-largest recipient of foreign direct investment in Western Asia. In light of the aforementioned factors, investors may choose to consider company formation in Turkey.

Between Europe and Asia is where Turkey is located. Due to its advantageous position for investors, transportation is made simple. Turkey benefits from many types of tariff exemptions with the European Union even though it is not a member. There are currently fewer customs and duties on goods and products thanks to Turkey and the EU's customs union. An investor would benefit from choosing Turkish company creation for the reasons listed above.

Advantages of Turkish Company Registration

The advantages of registering a company in Turkey are as follows:
Turkish economy- Turkey's economy is regarded as one that is rapidly evolving and is open to global advances. This nation is among the top 30 for shielding investments from businessmen. According to data, Turkey is ranked among the top 60 locations in the world for conducting business. Turkey's GDP is currently $649 billion and is steadily increasing.
Free Trade Zone in Turkey- A business can be incorporated in the Turkish free trade zone by an investor seeking company registration in Turkey. There are many advantages to forming a business in this free zone. The government would provide various tax breaks and privileges for a business established in a free trade zone. In addition, an investor can return funds from the Turkish Free Trade Zone to their native country.
Customs Union- Turkey is a part of the EU's customs union even though it is not a member of the EU. As a result, there are several trade and tariff exemptions for Turkish goods thanks to this union.
Foreign direct investment- Turkey is the country in Western Asia that receives the most foreign investment from nations like the UK, the USA, and India. This demonstrates how Turkey's government has opened up various industries to international business.
Efficiency of Business- A Turkish business can be incorporated with relative ease. One shareholder and one director are required for the incorporation of a company in Turkey. In Turkey, EUR 3300 is the minimal capital requirement for company creation. To incorporate a business, an investor does not have to be present in Turkey. Due to all of these factors, doing business in Turkey is simple.
Transparency- The top 60 business travel destinations worldwide include Turkey. The Transparency Index places Turkey among the top 70 nations for having the least amount of corruption. Therefore, there is no government involvement in the Turkish company registration procedure.

Business Structures acceptable for Turkish Company Registration

The following business structures are acceptable for Turkish company registration:
Joint Stock Company in Turkey- This thing is also referred to as a "JSC." A public limited company and a joint stock corporation are similar in Turkey. The shareholders of the company must be appointed, as well as the board members. Shares of this type of entity may be listed on a publicly traded Turkish stock exchange.
Limited Liability Company in Turkey- This business is also referred to as a "LLC." This kind of entity's liability is constrained to a specific sum. Separate from the company's liabilities are the members' obligations. For the purpose of carrying out their respective obligations, directors and shareholders must be appointed. A manager typically oversees an LLC.
Branch Office- A branch office is only an overseas parent company's extension. Usually, the main firm would be responsible for the branch office's debts. All of the branch office's debts are the responsibility of the international parent business. A branch office can engage in profitable operations. Additionally, a set percentage of corporate tax would be due by this entity.
Representative Office- The representative office is merely an addition to the overseas parent firm, much like a branch office is. The representative office's liabilities would fall under the jurisdiction of the overseas parent firm. Only market research and initiatives that promote the activity of the overseas parent firm would be undertaken by a representative office. The representative office is not permitted to engage in any activity that could be considered profitable.
Company for Turkish Free Zones- Incorporating a Turkish Free Zone Company is simple. The advantages of having this type of business are numerous. Using this type of entity, money can be returned to the country of origin.

Minimum Requirements for Turkish Company Registration

When registering a business in Turkey, the following qualifying requirements are taken into account:
Minimum shareholders- Turkey's minimum capital requirement to establish a joint stock corporation is 50,000 Turkish Liras (TL). However, TL 100,000 is required as capital for non-public joint stock companies. A limited corporation or limited liability company must have TL 10,000 in capital as a minimum.
Shareholders at a minimum- Both a Joint Stock Company and a Limited Liability Company may have any number of shareholders. To start this kind of corporation, however, a minimum of one shareholder is needed, according to the general rule of thumb.
Minimum Directors- For the Turkish business registration process, a minimum of one director is needed. In Turkey, there is no maximum amount needed for company registration. The management or partner would have the authority to speak on behalf of the Limited Liability Company.
Requirements for residency- This would not be a need for Turkish company registration. The only branch offices with a local representation would be those with particular needs.

Turkey's Company Registration Process

For the registration of a corporation in Turkey, the following steps must be taken:

Sign up with MERSIS- The applicant would need to register for MERSIS in the first phase of company registration. The online method would be accessible to all candidates. For overseas applicants, registration with MERSIS would first require a tax number.
Web-based System- Contracts, which can be generated by entering specific application-related information, are linked to the online system for MERSIS. The aforementioned technology would also generate the Company's Tax Number. It would be necessary for authorized representatives to sign contracts. Some businesses would be required to follow Trade Registry Directorate requirements.
Notary- If the approval process is aimed at the Notary, then the necessary steps must be taken in the appropriate notary. The signatures would be confirmed when the notary completed the necessary steps. Following this, people would likewise prepare declarations.
The deposit of money- The bank account must contain 0.04% of the company's authorized capital. The "share competition authority" would be the owner of this bank account. This sum can be paid along with all other transactions in the relevant trade registration. 25% of the sum in cash for joint stock businesses must be deposited in the bank account. This would be for the company's registration process.
Trade Registry Request- The applicant must submit an application to the trade registry as the following step. A trade registry directorate application would need to be submitted in this case. The trade register would confirm after reviewing the application.

Requirements for Turkish Company Registration

For the registration of a corporation in Turkey, the following requirements must be met:

Shareholders' Meeting- At the conclusion of the accounting year, shareholders meetings must be held within three months.
A special general meeting- When necessary, the Shareholders would summon an extra-ordinary general meeting.
Board of Directors Meeting- Board meetings must be conducted in accordance with the company's articles of organization.
Corporate Tax- The Company is required to submit tax returns to the appropriate tax authorities. In Turkey, businesses would pay a 20% tax.
Business registration- Companies registered in Turkey are required to complete both the initial registration process and annual filings.

Documents Needed

The following papers are necessary for Turkish company registration:

Company's articles of association, signed by the promoters
Knowledge that the bank has contributed 25% of the capital
Proof of payment to the competition authorities or any supporting documentation
Company Valuation Reports to Ascertain Cash Assets and Non-Cash Assets
Document showing that there are no restrictions on other types of capital is required.
A statement or other evidence demonstrating the ownership of the relevant intellectual property rights
All agreements made before and after incorporation
Ministry-specific approvals in accordance
Information about the responsibilities of the Board of Directors
Details about the directors (notarised copy that the board is taking rightful of competent body for registration)
Signatures that have been authorized by those who can bind the company
Whatever agreements of any kind that the business enters into.
Declarations of the Company's Directors are signed, and the Trade Registry of the Company approves signatures.

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FAQs

Concept of LLP

LLP is an alternative corporate business form that gives the benefits of limited liability of a company and the flexibility of a partnership.
The LLP can continue its existence irrespective of changes in partners. It is capable of entering into contracts and holding property in its own name.
The LLP is a separate legal entity, is liable to the full extent of its assets but liability of the partners is limited to their agreed contribution in the LLP.
Further, no partner is liable on account of the independent or un-authorized actions of other partners, thus individual partners are shielded from joint liability created by another partner’s wrongful business decisions or misconduct.
Mutual rights and duties of the partners within a LLP are governed by an agreement between the partners or between the partners and the LLP as the case may be. The LLP, however, is not relieved of the liability for its other obligations as a separate entity.

Since LLP contains elements of both ‘a corporate structure’ as well as ‘a partnership firm structure’ LLP is called a hybrid between a company and a partnership.

Structure of LLP

LLP shall be a body corporate and a legal entity separate from its partners. It will have perpetual succession.

Advantages of LLP

LLP form is a form of business model which:

(i) is organized and operates on the basis of an agreement.

(ii) provides flexibility without imposing detailed legal and procedural requirements

(iii) enables professional/technical expertise and initiative to combine with financial risk-taking capacity in an innovative and efficient manner

Other Countries where this form is available

The LLP structure is available in countries like United Kingdom, United States of America, various Gulf countries, Australia and Singapore. On the advice of experts who have studied LLP legislations in various countries, the LLP Act is broadly based on UK LLP Act 2000 and Singapore LLP Act 2005. Both these Acts allow creation of LLPs in a body corporate form i.e. as a separate legal entity, separate from its partners/members.

Difference between LLP & ‘Traditional Partnership’

Under “traditional partnership firm”, every partner is liable, jointly with all the other partners and also severally for all acts of the firm done while he is a partner.
Under LLP structure, liability of the partner is limited to his agreed contribution. Further, no partner is liable on account of the independent or un-authorized acts of other partners, thus allowing individual partners to be shielded from joint liability created by another partner’s wrongful acts or misconduct

Difference between LLP & Company

A basic difference between an LLP and a joint stock company lies in that the internal governance structure of a company is regulated by statute (i.e. Companies Act, 1956) whereas for an LLP it would be by a contractual agreement between partners.
The management-ownership divide inherent in a company is not there in a limited liability partnership.
LLP will have more flexibility as compared to a company.
LLP will have lesser compliance requirements as compared to a company.

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