Importing and Exporting Business in Turkey
This article explains importing and exporting business in Turkey in detail. If you have any further questions after reading the article, feel free to contact us.
The Turkish market has seen a spectacular rebound in the import and export business in recent years, encouraging investors and traders around the globe to establish businesses in Turkey to participate in this market with a strong potential for profit and returns. Many major nations, including Germany, Russia, Italy, France, and China, see Turkey as a major import destination.
Turkey’s main export destinations include Germany, the United Kingdom, Iraq, Italy, and France, where many various goods are sent each year, including; refined oil, vehicles, iron ore, car components, and trucks. In October 2018, Turkey’s exports achieved their greatest monthly level in the country’s history. Turkish exports totaled $15 billion, up 13.1 percent over the same period last year.
In the same sense, the Turkish Statistics Agency and the Ministry of Commerce both said that Turkish exports grew by 22.4 percent in September 2018 compared to the same month last year. Turkey’s exports in September 2018 were valued at $15 billion. These numbers reflect a significant improvement over the position Turkey was in 15 years ago, and they are important in attaining the Turkish government’s objective of being one of the top ten economies in the world by 2023. Examples of some goods exported from Turkey include:
- Metals: Iron, mercury, copper, manganese.
- Agriculture and Food: Grapes, olives, cotton, figs, wheat flour, apples, vegetables, barley, tomatoes.
- Industry: Animal and vegetable oils, textile industry, plastic materials, raw wood and its products, sugar, cement, tires, auto parts, household tools, and accessories of all kinds.
Customs Union for Industrial Goods: Customs Union Agreement with European Union Countries
Turkey has been a signatory to the Customs Union Agreement with European Union members since 1995. Turkish products must comply with the criteria of their joint products with the European Union, according to the agreement. This agreement covers industrial items and agricultural products that have been manufactured.
• Turkey is currently the EU’s seventh-largest importer. Turkey has a high possibility of becoming a member of the European Union in the future.
• Cars, gold, refined petroleum, chemicals, machinery, and other items are mostly imported by Turkey.
• Turkey is also a member of the Euro-Mediterranean Partnership (Euromed), an initiative aimed at promoting economic cooperation among Sixteen Mediterranean nations. To protect foreign investors from double taxes, the Turkish government has signed many double taxation treaties.
Even though Turkey is not yet an EU member, the member sides have built a strong economic connection. Turkey signed a Customs Union agreement with the EU to boost trade and commercial cooperation. In recent years, the EU has placed first in Turkey’s imports and exports, while Turkey ranks seventh in imports and fifth in exports in the EU. Entrepreneurs seeking advice and direction in forming a trading business in Turkey can speak with one of our Turkish company formation professionals.
Trading Between Turkey and EU
Turkey exports a wide range of items to the EU, including; transportation equipment, textiles, agricultural products, automobiles, and so on, and imported materials include; chemical products, machinery, and transportation materials. Because it guarantees free movement of products, the Customs Union agreement has aided commerce between the two entities. Products with an ATR certificate that are shipped to Turkey are given special consideration.
Industrial commodities, not agricultural products (excluding processed agricultural products), services, and public procurement, are covered by the Customs Union. Because the trade industry is one of the most important contributors to the Turkish economy, international entrepreneurs find establishing a trading firm in this country highly tempting.
Customs Regimes in Turkey
There are eight customs regimes in Turkey, according to the Turkish legislation:
• Release for Free Circulation,
• Customs Warehousing,
• Inward Processing,
• Processing Under Customs Control,
• Temporary Admission,
• Outward Processing,
If you wish to start a business in Turkey and import or export various items, you’ll need a valid tax number. For exports, you must also be a member of a trade union in this area. Turkey mainly exports to the EU, Iraq, Russia, the United States, and the United Arab Emirates, and imports from the EU, Russia, China, the United States, and Iran.
The Most Imported and Exported Products in Turkey
Turkey, because of its location at the crossroads of Europe and Asia, is one of the most important trade partners for nations on both continents, giving it a significant edge in both importing and exporting commodities. Furthermore, certain raw materials imported by Turkish businesses are processed before being re-exported as completed items.
When it comes to imports and exports, Turkey is a world leader, with one of the greatest trade industries in the world. Turkey’s most popular exports include:
• Given the large number of foreign car manufacturers operating in the country, automobiles, spare parts, and automotive equipment are in high demand.
• Turkey is one of the most major gold producers in Europe and Asia, thus jewelry and precious stones are popular.
• Metals, with scrap iron being the most prevalent in terms of European exports.
• Agricultural goods — the majority of the fruit and vegetables grown locally are shipped to Europe.
• Fabrics and textiles are exported not just to the European Union, but also to Asian countries.
Germany, Italy, and the United Kingdom are the most representative European nations among the countries to which Turkey exports the majority of its products. Also, Turkey sends the majority of its goods to Iraq and the United Arab Emirates in the Middle East. Turkey imports raw resources such as; gold, textile fabrics, spare car components, and refined petroleum, among other things. According to current statistics, Turkey imports the majority of its raw materials from China, Germany, Italy, Russia, and the United States.
Documents Required When Importing Goods into Turkey
Turkish firms and foreign subsidiaries operating in the nation can import products under one of the above mentioned customs regimes. Specific documentation is required depending on the items entering the nation. When importing products into Turkey, in general, one of some of the following documentation must be provided to the Customs Offices:
• The nation from which the items are being sent provides customs entry paperwork.
• The Turkish firm importing the goods must first get an import license.
• The government-issued insurance certificate that must be shown with the items.
• There are several certifications, including the certificate of origin, the certificate of analysis, and the certificate of free sale.
• The purchase order, letter of credit, or invoice from the consulate (where required).
A business invoice and a packing list must also be included with the imported goods. Health certifications, ingredient certificates, phytosanitary certificates, and other particular documentation are required for unique goods such as; fish, fresh fruit and vegetables, meat, and other food products.
The list of documentation that must be submitted with items imported by Turkish firms is lengthy. In some circumstances, specific permissions are also necessary, which is why we encourage you to speak with one of our company registration agents in Turkey for more information on the requirements for starting an import business in this nation.
Documents Required for Exporting Goods from Turkey: The paperwork that must be presented when exporting goods from Turkey to another nation are identical to those that must be shown when importing items. The customs entrance paperwork, commercial invoice, and packaging list, as well as a weight certificate, must be submitted among them. The exporting firm must also have a valid export license, which will be checked by the customs officials in the destination country.
Importing and Exporting Goods in Turkish Free Zones: Turkey has several free zones where unique import and export rules apply. These processes generally include less paperwork, but they often come with perks like VAT exemptions. Turkish free zones also provide warehousing and storage services.
Related Article: Corporate Taxation in Turkey.
Turkey is a member of Euromed
Turkey is a member of the Euro-Mediterranean Partnership (Euromed), which aims to foster economic cooperation among the 16 nations bordering the Mediterranean Sea. These nations have signed free trade agreements to strengthen their economic ties. Euromed brings together countries from Europe, Africa, and the Middle East, and this cooperation has helped Turkey expand its exports to Africa and Asia while also growing its economy.
Clothing, automobiles, agricultural goods, and other items are among the primary exports of Turkey. Following the economic difficulties that afflicted most European nations in recent years, Turkey expanded its exports to African and Asian countries, as well as governments that are members of the Organization of Islamic Cooperation.
How Can You Register an Import-Export Company in Turkey?
International entrepreneurs who wish to open an import-export firm in Turkey must comply with the country’s business regulations and legislation. For most of these operations, a limited liability corporation is the best solution because the registration processes and structure are easy. While private LTDs are favored in Turkey for small and medium businesses, public LTDs are used for larger enterprises and associated businesses.
• In Turkey, an LTD must have at least one shareholder, but no more than 50.
• A Turkish bank account is required to deposit the minimum share capital.
• The Articles of Association are the most important documents in a firm, containing information about the owners, operations, business address, rules, and more.
• A power of attorney can be used to represent the Turkish LTD.
• Some import and export operations need the acquisition of specific licenses and permissions. They must be acquired at the registration stage.
If everything checks out, the Turkish Trade Register verifies the documents and makes the necessary approvals.
Although the requirements of forming a business in Turkey are not difficult, it’s indeed advisable to seek legal advice when drafting paperwork and applying for licenses and permissions. The limited liability company (LLC) is the best business form for foreigners who wish to start a business in Turkey.
A limited liability company can be registered in Turkey for minimum share capital of around 3,000 Euros, followed by other important formalities such as preparing the Articles of Association, a letter of undertaking showing the business activities, power of attorney for company representatives, and copies of the owners’ identification documents.
Import and Export Procedures in Turkey
Turkey is one of the world’s major trade economies, with firms importing and exporting a wide range of goods, particularly in the agricultural sector. This is why the country has a well-developed land, sea, and air transportation network.
The majority of Turkish firms’ exports are destined towards Europe and Asia. In addition, both imported and exported items must be declared with the Turkish Customs Authorities and must be accompanied by forwarder declarations as well as other papers, such as:
– conformity certificates,
– proof of payment of the import/export duties and other taxes,
Additional documentation will be required for the import or export of certain specific items. Antiquities are also prohibited from being exported from Turkey. Turkey has signed many international agreements to make import and export procedures easier and is currently a member of the World Trade Organization, the Economic Cooperation Organization, and the Black Sea Economic Cooperation. Companies in this country also utilize the Harmonized System to classify products that are imported or exported. Thus, importing and exporting business in Turkey is a great investment.
Trading Between EU and Turkey in 2020
Germany accounted for about €12,633 million in EU imports of products from Turkey in 2020, followed by Italy with €7,456 million and France with €6,667 million. Germany also came in first for EU goods exports to Turkey, with about €21,798 million, followed by Italy with almost €7,700 million and France with over €6,300 million. Furthermore, Turkey has strong commercial ties with nations such as; the Netherlands, Spain, Belgium, Hungary, Poland, Sweden, Denmark, Ireland, Croatia, and many others.
New FTA agreements signed by Turkey in 2021
Turkey has 21 FTAs in place with nations all around the world. Turkey’s most recent Free Trade Agreement (FTA) with the United Kingdom was signed in 2021, while others with Sudan, Qatar, Lebanon, Japan, Indonesia, Ukraine, and Thailand are being renegotiated or are about to enter into force. We would like to remind you that a free trade agreement is a significant treaty built on particular policies to support commerce between nations with fewer formalities and bureaucracy. In other words, in Turkey, import and export verification is made quick, easy, and efficient, with no limitations. Importing and exporting business in Turkey is a pretty good opportunity for foreign investors looking to invest in Turkey.
Turkey, a Growing Economy in The Recent Years
Turkey’s economy has expanded and become more diverse in recent years, owing to exports to European and Asian nations. Clothing, automobiles, electronics, agricultural products, iron, oil, tobacco, and other items were all exported. Following the onset of the economic crisis, Turkey expanded its exports to African and Asian nations, as well as the Organization of Islamic Countries.
Shipments to OIC nations grew by 50% in 2008, and exports to Iraq increased by 75% in the first quarter of 2009. According to the International Monetary Fund, Turkey is an emerging market and one of the newly industrialized countries, ranking first in agricultural products and transportation equipment. Although the private sector is significant in this nation, the public sector is highly represented in manufacturing, transportation, and finance. According to the latest data and information for Turkey, about 200 significant products worth around USD 140.4 billion were exported in 2018.
Valuable Tips and Information About Imports From Turkey
It may appear that working in the sector of import and export necessitates a considerable amount of cash, but you can really start your firm with enough equity and then grow your operations after gaining a better grasp of the market via experience and accumulating information. As a result, you may obtain import proposals from Turkey at the lowest possible cost.
There are some things to consider when importing from Turkey
To ensure a decent presence in the target market, you must adhere to product quality standards and their adherence to particular requirements, as well as be free of quality manipulation by some firms and factories. If you don’t have enough experience with inspecting imported products, you may use one of the firms that specialize in inspecting imported items.
Importers may also forget important details such as not declaring the nation of origin or source of origin. This results in the rejection of your goods at customs and the imposition of a penalty, therefore you must pay close attention to this subject. If your items were made in Turkey, a statement; “MADE IN TURKEY” must be included to avoid any complications or fines.
This article was published on 02.12.2020 and last edited on 27.07.2021. Images used in this article have been taken from free image-sharing services on the internet. Also, in this article, which is called; “Importing and Exporting Business in Turkey,” information freely shared on the internet was used, and necessary references were given in the article. We make every effort to offer accurate and current information. However, please do let us know if you find any errors in this article.