Joint Venture Formation in Türkiye

Joint Venture Formation Process

1. 01

   Determining the Structure

   It is decided whether the joint venture will be set up as a company or under a partnership agreement. The parties’ contributions are subject to different rules depending on the structure chosen:

   • In an ordinary partnership: Each partner makes a contribution in the form of money, receivables, other assets or labour. Labour contributions are possible in this structure. (Code of Obligations, Art. 621)
   • In a joint stock or limited liability company: The partners contribute capital in cash or in kind. Services, personal labour, commercial reputation and receivables that are not yet due cannot be contributed as capital. (Commercial Code, Art. 342, 581)

   At this stage, shareholding ratios, the management and decision-making structure, profit sharing and exit rules are also clarified.

2. 02

   Preparing the Partnership Agreement

   • In an ordinary partnership: The agreement sets out the partners’ contributions (Code of Obligations, Art. 621) and the persons who will manage and represent the partnership (Code of Obligations, Art. 637).
   • In a business partnership: The partnership is formed by a written agreement to complete a specific job. (Corporate Tax General Communiqué Serial No. 1, Section 2.5.2)
   • In a joint venture company: In addition to the articles of association, rules among the partners on management, capital increases and share transfers are set out. In a limited liability company, a share transfer is made in writing with notarised signatures; unless the articles of association provide otherwise, approval of the general assembly (genel kurul) is required. (Commercial Code, Art. 595)
3. 03

   Assessing Whether Competition Board Approval Is Required

   Two elements are assessed together to determine whether a joint venture counts as an acquisition: the parent undertakings must have joint control over the joint venture, and the joint venture must perform all the functions of an autonomous economic entity on a lasting basis. In such a transaction, each of the parties is deemed an acquirer. (Communiqué No. 2010/4 on Mergers and Acquisitions Requiring the Approval of the Competition Board (Rekabet Kurulu), Art. 5/2 and 5/3)

   Under the thresholds updated by Communiqué No. 2026/2 dated 11 February 2026, Competition Board approval is mandatory for the transaction to become legally valid if either of the following applies (Communiqué 2010/4, Art. 7):

   • The total Türkiye turnover of the transaction parties exceeds TL 3 billion, and the Türkiye turnover of at least two of them each exceeds TL 1 billion
   • The Türkiye turnover of the asset or activity being acquired exceeds TL 1 billion, and the worldwide turnover of at least one of the other transaction parties exceeds TL 9 billion

   If at least one of the parties to a merger or, in an acquisition, the acquired undertaking is a technology undertaking established in Türkiye, the TL 1 billion thresholds are applied as TL 250 million in respect of the transaction party being acquired; the TL 3 billion and TL 9 billion thresholds do not change. (Communiqué 2010/4, Art. 4/1-e, 7/2) In a joint venture, each parent undertaking acquiring joint control is taken into account with its turnover as an acquirer; the turnover of jointly controlled units is divided equally by the number of undertakings concerned. (Communiqué 2010/4, Art. 5/3, 8/3, 8/4) According to the turnover guidelines of the Competition Authority (Rekabet Kurumu), in a new joint venture to which the parent undertakings do not transfer a line of business, there is no asset or activity being acquired to which turnover can be attributed, so the threshold in the second item cannot be exceeded; the assessment is made on the turnover of the parent undertakings under the TL 3 billion and TL 1 billion each criterion, and the new joint venture itself is not counted as an undertaking concerned. If a parent undertaking contributes its subsidiary or business line to the joint venture, that unit counts as the asset or activity being acquired; if joint control of an operating company is acquired, the subject of the transfer is that company. When the TL 250 million threshold for technology undertakings is assessed, only turnover from activities in technology fields is taken into account. (Competition Authority Turnover Guidelines (Rekabet Kurumu Ciro Kılavuzu), paras. 12, 27, 29, 31, 32)

   Joint ventures between the parent undertakings that have as their object or effect the restriction of competition and that will perform all the functions of an autonomous economic entity on a lasting basis are also assessed under Articles 4 and 5 of Law No. 4054 on the Protection of Competition. (Communiqué 2010/4, Art. 13/3)

4. 04

   Formation and Tax Registration

   • Joint venture company: Registered with the Trade Registry; the Trade Registry Directorate (ticaret sicili müdürlüğü) forwards the notification of commencement of business (işe başlama bildirimi) to the tax office (vergi dairesi). (Tax Procedure Law No. 213, Art. 153)
   • Business partnership: A partnership that meets the conditions files a notification of commencement of business with the tax office, together with its request for corporate tax liability. The competent tax office is the tax office of the place where the head office stated in the formation agreement is located. (Corporate Tax Law, Art. 2/7; Corporate Tax General Communiqué Serial No. 1, Section 2.5.2; Tax Procedure Law, Art. 153)
   • Other ordinary partnerships: VAT, withholding tax, documentation and bookkeeping obligations are assessed separately according to the nature of the activity.
5. 05

   Accounting and Reporting

   Profit sharing and taxation differ across the three structures; no single contractual rule applies to all of them:

   • Ordinary partnership: Profits and losses are shared among the partners according to the agreement. Unless the agreement provides otherwise, each partner has an equal share in profits and losses, regardless of the value of its contribution. (Code of Obligations, Art. 623)
   • Business partnership: Corporate tax is calculated in the name of the business partnership; profit is shared among the partners when the job is completed. (Corporate Tax Law, Art. 2/7; Corporate Tax General Communiqué Serial No. 1, Section 2.5.2)
   • Joint stock or limited liability company: Dividends are distributed only out of net profit for the period and reserves set aside for that purpose, by resolution of the general assembly, in accordance with the law and the articles of association. (Commercial Code, Art. 507, 608)

   Transactions with partners that qualify as related parties are subject to the arm’s length principle (emsallere uygunluk ilkesi). (Corporate Tax Law, Art. 13) For details, see our Accounting and Bookkeeping and Transfer Pricing pages.