Branch

A branch is a unit of a commercial business that is attached to its head office but operates with a degree of independence in external dealings. A branch has no legal personality of its own; the head office company is liable for its transactions.

Key Features

• Legal personality: A branch is not a separate legal entity; its assets and debts belong to the head office company.
• Registration: A branch is registered with the trade registry where it is located. The branch’s trade name includes the head office’s name and states that it is a branch.
• Representation: A branch manager is appointed to run the branch; the power of representation is registered and published. See Power of Representation.
• Accounting: A branch is included in the head office’s accounts but may give rise to separate tax obligations.

Branch of a Foreign Company

Foreign companies can conduct commercial activity in Turkey by opening a branch. The branch is the foreign company’s extension in Turkey; the foreign company is directly liable for its debts. On registration, the foreign company’s registry records, articles and resolution to open the branch are submitted with apostille and translation, and a representative with full authority over the branch is appointed.

For a foreign company, the choice between a branch and setting up a joint stock company or limited liability company depends on limitation of liability, tax and the nature of the business. For companies that will not conduct commercial activity, a liaison office is also an option. See Foreign Direct Investment and our guide Setting Up a Company in Turkey.