Legal Guide for Startups: Choosing the Right Company Type in Türkiye

Setting up a startup in Türkiye requires more than just a strong business idea — it demands a clear understanding of the legal framework, especially when choosing the right company type in Türkiye. For entrepreneurs planning to operate in the Turkish market, selecting between a limited liability company (Ltd. Şti.) and a joint stock company (A.Ş.) can impact taxation, liability, and investment flexibility. This guide walks you through the key legal considerations every founder should be aware of.

1. Why Company Type Matters for Startups

The legal form you choose will directly affect your company’s structure, tax obligations, liability exposure, and access to investors. For startups, especially those targeting growth and funding, this decision should be strategic.

• Limited Liability Company (Ltd. Şti.) is the most common type among startups in Türkiye. It offers ease of formation, limited shareholder liability, and straightforward corporate governance. It is ideal for small to medium-sized ventures.

• Joint Stock Company (A.Ş.), on the other hand, allows for issuing shares to the public and is often preferred by larger enterprises or startups planning future public offerings or major VC investments.

  
  

Choosing the wrong company type can result in operational inefficiencies, increased costs, or even legal risks. Consulting with a qualified lawyer early in the process ensures compliance and flexibility.

2. Key Differences Between Ltd. Şti. and A.Ş.

Feature	Ltd. Şti.	A.Ş.
Minimum Capital	10,000 TRY	50,000 TRY
Share Transfer	Notarized & restricted	Freely transferable
Public Offering	Not allowed	Permitted
Board Requirement	Optional	Mandatory
Investor Preference	Small/medium ventures	Institutional/VC-backed

Understanding the differences between each company type in Türkiye will help startups structure their operations in a way that meets legal requirements and supports long-term growth.

Also note: foreign entrepreneurs can fully own a company in Türkiye, and the process can often be completed remotely with a power of attorney.

3. Final Thoughts and Legal Support

Establishing the right legal foundation is a critical first step in building a successful business. While many founders focus on product development and funding, the legal structure plays a long-term role in governance, investor relations, and liability management.

Working with a law firm that understands both Turkish corporate law and startup dynamics can save you time and future legal issues. At Bosphorus Law Firm, we support local and foreign entrepreneurs throughout the company formation process and provide ongoing legal consultancy tailored to startup needs.

At Bosphorus Law Firm, we understand the unique legal challenges startups face in Türkiye. Whether you're navigating incorporation, investor structuring, or compliance requirements, our team provides tailored legal solutions that align with your growth goals.

Ready to launch your startup with the right legal foundation?Schedule a personalized consultation with our corporate law experts today — and take the first step with confidence.