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Registration of a Branch of a Foreign Company in the TRNC

Registration of a Branch of a Foreign Company in the TRNC

Do you want to increase your company’s flexibility and do business in the TRNC in a fast, flexible and easy way? A foreign branch registered in the TRNC can enjoy all the advantages extended to all TRNC legal entities. The procedure is easy, straight forward and shall contribute towards the growth and development of your company. The corporate environment is ideal and you shall take advantage of the tax advantages it provides. The many benefits your company shall gain are briefly developed hereunder.

In recent years, the number of foreign companies registered on the island has increased considerably and serious attempts have been made by foreign investors to establish new companies or to open branches of existing overseas companies. Foreign companies are companies established outside the TRNC but operating in the TRNC by opening branches in the TRNC. Anonymous or limited companies established in foreign countries may open a business or branch in the TRNC. For this purpose, if the share of the foreign shareholders exceeds 49%, the permission from the Ministry of Economy as well as the Council of Ministers is required. Once these permits have been obtained, the company can be registered by applying to the TRNC official Registrar of Companies. The minimum capital share of the company must be Turkish Lira corresponding to 100,000 Dollars.

Documents to be submitted for registration of foreign companies in the TRNC official Registrar of Companies;

The documents to be obtained from the country where the overseas company is established must have the approval of relevant authorities, notarised by the TRNC representative in that country (if any) or from the Turkish Embassy. Otherwise, ​​they must be approved by an apostille stamp. Overseas companies are required to submit the following documents to the TRNC official Registrar of Companies. within 1 month of their establishment in the TRNC.

  1. A company declaration of incorporation,

  2. Articles of Association

  3. Rules and Regulations

  4. A document indicating the name and address of a natural or legal person residing in the TRNC (with a residence or work permit) authorized by the company's board of directors for the notification of any official documents or legal proceedings in the TRNC

  5. Character document and criminal record taken from the foreign company shareholder’s country of origin,

  6. A decision of the Board of Directors showing that the company aims to open a branch in the TRNC and how much Capital it has allocated for this purpose,

  7. Shareholders’ address, number of shares, type and value.

  8. A valid document taken from the Chamber of Commerce of the country of origin showing that the company is registered and operational,

  9. If the Director of the Company is a real person, the details regarding his/her first name, surname, residence, workplace address, nationality are all required. If he/she is a director in another company, the details of this legal entity, the name of the company and its registered address are required.

  10. The name, surname, the residence of the secretary if he/she is a real person; if the secretary is a legal entity, the name of the company and the registered address are required by the TRNC official Registrar of Companies.

Additionally, an overseas company that has completed the registration procedures and submitted all the necessary documents to the TRNC official Registrar of Companies has the right to own immovable property in the TRNC.

Overseas company terminating its activities in the TRNC

If a foreign company with a workplace or a branch in the TRNC ceases its activities on the island, it has to notify the TRNC official Registrar of Companies within one month at the latest. As of the date of this notification, the company is no longer obliged to report its activity reports, balance sheets and other documents to the TRNC official Registrar of Companies. However, if the company does not make this notification in a timely manner, and the TRNC official Registrar of Companies considers that the company has terminated its activities in the TRNC, it may remove the registration of the company from the registrar’s list of companies.
 

Overseas company submitting a balance sheet report

Overseas businesses must present their balance sheets and annual reports in each calendar year, together with a profit and loss statement.
 

Obligation to report where the company is established

It is necessary for an overseas company to state where it is established in its prospectus for its shares and deeds, the name of the company and where it is established in the TRNC in its invoices, official announcements and letters and other official documents. Equally, if it is a limited company, it must also state the name of the company and where it is established on a signboard where it conducts business. In the TRNC, foreign investors are provided with significant incentives for the development of the economy. Foreign investors who register a company in the TRNC or complete their branch opening procedures may complete the feasibility studies required to obtain investment incentives and submit them to the State Planning Organization. The investment applications are finalised within approximately a period of 3 months.

Attr. Berke Ada
  • Attr. Berke Ada
  • January 2019