Step-by-Step Guide for Liaison Office Operation Period Extension
Step-by-Step Guide for Liaison Office Operation Period Extension
Step-by-Step Guide for Liaison Office Operation Period Extension
Step 1: Assessing Eligibility for Extension
The initial permit period must have expired. Liaison offices are granted an initial permit for a maximum of 3 years.
The initial three-year operating period must have been completed before applying.
The operating periods of offices that received permission for market research or the promotion of the foreign company's products or services will not be extended.
Step 2: Application Timing
- Offices wishing to extend their operating period must apply to the General Directorate of Incentive Implementation and Foreign Capital (General Directorate) before the expiry of the operating period.
Step 3: Application Authority
- Extension applications are made to the General Directorate of Incentive Implementation and Foreign Capital (General Directorate). Prior to the 2012 amendment, this authority resided with the Undersecretariat of Treasury. However, with the relevant regulation change, the authorized body became the Ministry of Economy (Ministry) and its affiliated General Directorate. Currently, applications are processed by the Ministry of Industry and Technology.
Step 4: Evaluation Criteria
The General Directorate considers the following elements when evaluating extension requests:
The office's past year activities. In this context, the "Information Form Regarding the Activities of Liaison Offices" (EK-4) and accompanying documents, which must be submitted by the end of May each year, are examined. Failure to submit this form and its attachments will result in the extension request not being evaluated and the operating permit being revoked ex officio. Documents proving that the past year's expenditures were covered by foreign currency sent from abroad must be submitted. Foreign Currency Purchase Certificates (DAB) are important evidence.
The foreign company's future business plan and targets in Turkey. A detailed report on future projects may be requested.
Current and projected expenditure amount.
Number of personnel employed.
Nature of the activity to be conducted. The Ministry expects liaison offices to contribute to the Turkish economy and markets. Acting as an intermediary in export activities can also be evaluated positively, provided that these transactions are properly documented and submitted in the annual activity report.
Step 5: Extension Period
As a result of the evaluation, an extension period of up to 5 or 10 years may be granted depending on the nature of the activity to be carried out.
A 5-year extension may be granted for activities such as representation and hospitality, quality control and inspection of suppliers in Turkey, technical support, and communication/information transfer. Documenting representation and hospitality activities such as participation in seminars and exhibitions is important.
A 10-year extension may be granted for regional management center activities.
Step 6: Important Considerations
Fulfillment of Notification Obligations: It is important that all past notification obligations (tax office registration certificate, lease agreement, address/authorized person/title changes, annual activity reports, etc.) have been fulfilled completely and on time. Extension requests from offices that have not fulfilled their notification obligations will not be evaluated.
Prohibition of Commercial Activity: It is essential that liaison offices do not engage in commercial activities in Turkey. If commercial activity is detected, the operating permit will be revoked.
Documentation: All activities and foreign currency transfers must be proven with documents such as bank statements and Foreign Currency Purchase Certificates (DAB).
Application Form and Undertaking: The application form (EK-6) and the undertaking stating that no commercial activity will be carried out (EK-7) must be fully completed and signed by the foreign company's authorized representative. A document showing the signatory's authority must also be attached.
Step 7: Finalization of the Application
- Applications are finalized within fifteen business days from the date of application, provided that the requested information and documents are complete and accurate.
By following these steps and taking the necessary care, you can carry out the extension application for your liaison office's operating period.
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