The different forms of establishment in Türkiye: commercial representation, Joint-Venture or subsidiary

November 4, 2024

The different forms of establishment in Türkiye: commercial representation, Joint-Venture or subsidiary

Expanding into Türkiye is a strategic step for companies looking to access new markets. However, selecting the right form of establishment is a crucial decision that depends on your objectives, industry, and resources. Here is an overview of the main options: commercial representation, joint venture, or subsidiary, along with their respective advantages and disadvantages.


1. Commercial representation: a light solution to explore the market


Commercial representation is often the first step for companies seeking to test the Turkish market without committing significant resources. This usually involves setting up a liaison office or working with a local agent or distributor.


Advantages:

  • Lower costs: no need to establish a legal entity in Türkiye, which limits initial investments.
  • Flexibility: allows you to understand the market and develop local relationships before making a larger commitment.
  • Simplified administration: a liaison office is tax-exempt as it does not conduct direct commercial transaction.


Disadvantages:

  • Limited scope: you cannot issue invoices or sign commercial contracts directly from the liaison office.
  • Dependence on the local partner: if working with an agent or distributor, your success will largely depend on their performance.



2. Joint venture: a strategic partnership with a local player


A joint venture involves partnering with a Turkish company to share resources, expertise, and risks. This option is particularly suited for industries requiring local know-how or for entering highly competitive markets.


Advantages:

  • Access to local networks: benefit from your Turkish partner’s experience and business relationships.
  • Risk-sharing: costs and responsibilities are divided between both parties.
  • Enhanced credibility: partnering with a local player can facilitate market entry.


Disadvantages:

  • Management complexity: requires effective coordination and alignment with your partner.
  • Potential conflicts: disagreements on management or strategic objectives may arise if expectations are not clearly defined from the outset.
  • Due diligence required: choosing the wrong partner can jeopardize your expansion efforts.



3. Subsidiary: full control for long-term market presence


Establishing a subsidiary in Türkiye is the most structured and committed approach. It involves creating a local legal entity, either as a limited liability company (Limited Şirketi) or a joint-stock company (Anonim Şirketi).


Advantages:

  • Full control: you manage operations directly and make all strategic decisions.
  • Independence: a subsidiary allows you to establish your own identity in the Turkish market.
  • Access to tax incentives: foreign investors can benefit from specific advantages, particularly in free zones or for strategic projects.


Disadvantages:

  • High initial costs: setting up and operating a subsidiary requires significant financial resources.
  • Increased responsibilities: you bear full responsibility for risks and legal obligations.
  • Complex administrative processes: establishing a local entity requires thorough knowledge of Turkish regulations.



4. How to choose the right option?


To determine the best establishment model, it is essential to clarify your priorities:


  1. Testing the market: a commercial representation is ideal for starting with minimal risks.
  2. Partnering with a local player: a joint venture is relevant if you need a partner for market access or complex projects.
  3. Long-term investment: a subsidiary is the best choice if you seek full control and a lasting presence in Türkiye.



Conclusion: a key decision for success in Türkiye


Each form of establishment in Türkiye offers unique advantages but also comes with challenges. A thorough analysis of your objectives, industry, and available resources is essential to making the right choice.




---

Related keywords : establishment in Turkey, investing in Turkey, commercial representation in Turkey, liaison office in Turkey, joint venture in Turkey, business partnership in Turkey, subsidiary creation in Turkey, limited liability company in Turkey, joint stock company in Turkey, international expansion in Turkey, business regulations in Turkey, tax incentives in Turkey, foreign investment in Turkey, exporting to Turkey, business in Turkey, business opportunities in Turkey, market entry strategy in Turkey.

Prefer listening? Enjoy this article as a podcast here!
June 25, 2025
Créé par la Loi 3238 du 7 novembre 1985 modifiée, le Comité exécutif de l’industrie de défense (Savunma Sanayii İcra Komitesi – SSİK) a vu son rôle et sa composition redéfinis dans le cadre des mesures prises à l’issue de la tentative de coup d’État du 15 juillet 2016.
June 25, 2025
Established by Law No. 3238 of November 7, 1985 (as amended), the Defense Industry Executive Committee (Savunma Sanayii İcra Komitesi – SSİK) saw its role and composition redefined as part of the measures taken following the attempted coup of July 15, 2016.
June 5, 2025
La semaine suivant les élections américaines de novembre dernier, la toute nouvelle plateforme American Turkish Business Roundtable (ATBR) s’est réunie à Istanbul ...
June 5, 2025
The week following last November’s US elections, the newly formed American Turkish Business Roundtable (ATBR) gathered in Istanbul ...
April 28, 2025
When Stanford University released its Artificial Intelligence Index 2025 Report earlier this month, it sparked headlines on the growth and success of the Silicon Valley ...
April 28, 2025
Lorsque l'Université de Stanford a dévoilé début avril son rapport Artificial Intelligence Index 2025, l’attention s’est d’abord portée sur les réussites de la Silicon Valley ...
April 3, 2025
France 2030 est un programme ambitieux porté par le gouvernement français, visant à accélérer la transformation des secteurs stratégiques ...
April 3, 2025
France 2030 is an ambitious program led by the French government, aiming to accelerate the transformation of strategic sectors through ...
March 18, 2025
Le marché du travail en Turquie est en constante évolution, influencé par des dynamiques économiques, technologiques et politiques. Alors que le pays cherche à renforcer ...
March 18, 2025
The Turkish labor market is constantly evolving, influenced by economic, technological, and political dynamics. As the country seeks to enhance ...
More Posts