Turkey Desk

Turkey desk: deep business ties and a special legal relationship

Our Turkey desk works in a relationship shaped by history: Turkey and Germany are linked by close trade relations, a large Turkish-origin community in Germany and a special legal relationship with the EU that dates back to the Ankara Association Agreement of 1963. Turkish companies are active in Germany in textiles and fashion, automotive components, white goods and electronics, food, construction, logistics, retail and, increasingly, technology and defence.

Industrial goods circulate between Turkey and the EU without customs duties under the customs union, while services, investment and the movement of people are governed by a mixture of association law, national rules and bilateral agreements. Turkish investors in Germany therefore need a clear view of which rules apply to their goods, their companies and their staff.

This page summarises the German law issues that Turkish companies and investors typically face. It is part of our international clients practice and describes the legal framework and how we work, without claims about individual team members' backgrounds or languages.

Entry and acquisition structures for Turkish investors

Turkish companies usually enter the German market through a GmbH, which requires share capital of at least EUR 25,000, notarised articles of association and registration in the commercial register, or initially through a sales office or branch. A branch of a Turkish company is registered in the commercial register (§ 13d HGB) but leaves the Turkish parent fully liable and creates a German permanent establishment for tax.

The German entity must report its beneficial owners to the transparency register, and banks will examine the ownership chain carefully when opening accounts. Corporate documents from Turkey need an apostille and certified translation, and the notary will check the authority of the persons signing on behalf of the Turkish parent. See our GmbH formation checklist.

Acquisitions of German companies by Turkish buyers follow German M&A practice, with independent guarantees in the share purchase agreement and notarisation of GmbH share transfers. Turkish investors are non-EU acquirers for German investment screening purposes: acquisitions of 10%, 20% or 25% of the voting rights in companies in sensitive sectors can be reviewed, and in listed sectors must be notified and may not close before clearance (§ 56 AWV).

This is particularly relevant for targets in defence, critical infrastructure and technology, where Turkish industrial groups are increasingly active. Merger control applies above the turnover thresholds of the GWB and the EU Merger Regulation. See our pages on mergers and acquisitions and foreign investment control.

Tax structure

The double tax treaty between Germany and Turkey reduces withholding taxes on dividends, interest and royalties and allocates taxing rights. Relief from German withholding tax depends on German anti-treaty-shopping rules, so intermediate holding companies need substance. Transfer pricing documentation is required for supplies and services between Turkish group companies and the German subsidiary, which is common in textile, automotive and white goods supply chains. German corporate income tax of 15% falls gradually to 10% from 2032, and trade tax applies at municipal rates.

Joint ventures and family businesses

Many Turkish groups are family-controlled holdings, and their investments in Germany often take the form of joint ventures with German partners or acquisitions of German family companies. Joint venture agreements should address capital contributions, management and veto rights, technology and brand licences, deadlock and exit, and the treatment of related-party supplies from the Turkish group. Shareholder agreements and articles of association of the German company should be aligned, because only the articles bind future shareholders and the company itself. Our Turkey desk helps structure these arrangements so that they work under German company law and are consistent with the partners' governance at home.

The EU-Turkey customs union

The customs union between the EU and Turkey was established by Decision No 1/95 of the EC-Turkey Association Council of 22 December 1995 (Decision No 1/95). It covers industrial goods and processed agricultural products, which can circulate between the EU and Turkey without customs duties if they are in free circulation in the EU or in Turkey, regardless of where they originate.

Turkey applies the EU's common customs tariff to imports from third countries and has aligned large parts of its technical legislation with EU rules. Basic agricultural products, coal and steel products are not covered by the customs union and are traded under separate preferential arrangements requiring proof of origin.

Goods traded under the customs union are accompanied by an A.TR movement certificate, which proves that they are in free circulation. Because the customs union does not extend to Turkey's free trade agreements with third countries in the same way, products from those countries may face different treatment. Trade defence measures, such as EU anti-dumping duties, can apply to Turkish products in specific cases, and the EU can impose safeguard measures on steel imports. German importers and Turkish exporters should manage A.TR certificates, origin documentation for agricultural products and product compliance carefully. See our insights on customs and import VAT and anti-dumping and trade defence.

Product compliance

Products imported from Turkey into the EU must meet EU product legislation, including CE marking where required, and an economic operator established in the EU must be responsible for many product categories, often the importer or an authorised representative. Textile and toy products, electrical appliances and machinery are frequent subjects of market surveillance. Packaging, electrical equipment and batteries sold in Germany require registration with the German producer responsibility schemes. See our page on product liability and product compliance.

Sustainability rules affecting Turkish exporters

EU sustainability legislation increasingly affects Turkish exporters. The Carbon Border Adjustment Mechanism, whose definitive period began on 1 January 2026, covers imports of iron and steel, aluminium, cement, fertilisers, hydrogen and electricity, and EU importers need verified emissions data from producers. The EU Deforestation Regulation applies to certain commodities from 30 December 2026 for larger operators, and the Forced Labour Regulation will prohibit products made with forced labour from 14 December 2027. Textile exporters face ecodesign requirements and extended producer responsibility for textiles. Our Turkey desk helps Turkish suppliers and their German customers allocate these obligations in contracts. See our insight on CBAM.

Posting and immigration of staff

Turkish nationals generally need a residence title permitting employment to work in Germany. The EU Blue Card, the residence permit for skilled workers, the intra-corporate transfer card and the opportunity card are available on the same terms as for other third-country nationals, and the accelerated skilled worker procedure can shorten visa processing.

Turkish workers and their family members who have been legally employed in Germany for certain periods can derive additional residence and employment rights from Association Council Decision No 1/80, and the association agreement's standstill clauses have been relevant to visa and residence conditions in some cases before the CJEU. These rights are specific and fact-dependent and should be checked individually. See our page on immigration and global mobility.

Turkish companies posting employees to Germany, for example for construction, installation or service projects, must comply with German minimum working conditions under the Posted Workers Act, including the minimum wage, and must register postings with customs authorities in certain sectors. The social security agreement between Germany and Turkey can allow posted employees to remain in the Turkish system for a limited period. Construction and installation projects can create a German permanent establishment for tax after a period defined in the tax treaty. See our insight on posting workers to and from Germany.

Employment of local staff

Employees hired in Germany by a Turkish-owned company are protected by German employment law: written terms, the minimum wage, working time limits, statutory holiday, dismissal protection after six months in establishments with more than ten employees and works council rights where a works council exists. Employment contracts should be drafted under German law, because a Turkish choice of law cannot remove mandatory German protection. Our Turkey desk prepares contract templates and policies for German subsidiaries that fit both German requirements and group standards.

Trade and distribution contracts

Turkish manufacturers sell in Germany through importers, distributors, commercial agents, retail chains and online marketplaces. German law gives commercial agents a mandatory goodwill indemnity on termination of up to one average annual commission, and courts extend this to integrated distributors, so the choice of sales model has financial consequences. Standard terms used with German customers are reviewed for fairness under § 307 BGB, even between businesses.

Supply contracts with German retailers and brands often impose codes of conduct and audit rights, because German buyers with at least 1,000 employees in Germany are subject to the Supply Chain Due Diligence Act and pass due diligence expectations on to suppliers in Turkey. See our pages on distribution, agency and franchise and supply chain due diligence.

The UN Convention on Contracts for the International Sale of Goods applies to sales between German and Turkish companies unless excluded, since both countries are contracting states. Contracts should regulate governing law, Incoterms, payment security such as letters of credit or credit insurance, retention of title and quality inspection, as well as currency risk where prices are agreed in euros but costs arise in Turkish lira, taking account of the merchant's duty to inspect goods and notify defects without undue delay under § 377 HGB when German law applies.

Data protection and digital business

Turkish companies processing personal data of customers or employees in Germany must comply with the GDPR, and transfers of personal data from Germany to Turkey require a transfer mechanism, usually standard contractual clauses with a transfer impact assessment, because there is no EU adequacy decision for Turkey. Turkey's own data protection law, which was amended in 2024 to provide new transfer mechanisms, governs transfers in the other direction. E-commerce businesses selling from Turkey to German consumers must also observe German consumer law, including withdrawal rights and the order button rules, and EU platform regulation where they operate marketplaces. See our page on GDPR and German data protection law.

Disputes between Turkish and German parties

Arbitration is frequently chosen for contracts between Turkish and German parties, because both countries are parties to the New York Convention, so arbitral awards can be enforced in both. Institutions such as the ICC, the DIS and the Istanbul Arbitration Centre are used. Recognition of Turkish court judgments in Germany depends on the conditions of § 328 ZPO, including jurisdiction, proper service, public policy and reciprocity (§ 328 ZPO).

German courts also offer efficient interim relief, including attachments of assets in Germany and preliminary injunctions in competition and IP matters, which can be obtained within days where the urgency is shown. Since 1 April 2025, Commercial Courts can hear business disputes from EUR 500,000 in English where the states have provided for this. See our page on international arbitration.

Construction and infrastructure projects

Turkish construction and engineering companies participate in German and European infrastructure projects as contractors or subcontractors. Public contracts above the EU thresholds are awarded under German procurement law, which is open to bidders from Turkey under applicable international commitments in many cases, but some defence and security tenders can be restricted to European bidders. Construction contracts usually incorporate the VOB/B, and disputes over variations and delays are common. Posting rules, minimum wages in the construction sector and the social fund contributions of the construction industry apply to posted staff. Our Turkey desk works with our construction practice; see our page on construction law.

How our Turkey desk helps

Our Turkey desk advises Turkish companies and investors on entering and growing in the German market: formation of subsidiaries, acquisitions and joint ventures including investment screening, customs union and product compliance questions, posting and immigration of staff, and trade, distribution and supply contracts. We advise on employment, data protection and compliance, coordinate with tax advisers on treaty questions, and represent clients in German courts and arbitration. We also advise German companies on business with Turkish partners from the German law side, including supply chain due diligence for suppliers in Turkey and joint ventures. To discuss your plans, please contact us. This page provides general information, not legal advice.