Establishing and managing subsidiaries in exotic jurisdictions

Are you entering new markets and looking for ways to strategically diversify risks outside traditional European and American destinations? This article provides detailed legal and business guidance on establishing a subsidiary in Turkey, Oman, and Nigeria. You will learn what specific steps to take, what risks to face, and what opportunities these dynamic economies offer in 2025.

Need advice on this topic? Contact the ARROWS law firm by email office@arws.cz or phone +420 245 007 740. Your question will be answered by "Mgr. Vojtěch Sucharda", an expert on the subject.

 

Why expand beyond traditional markets? Strategic diversification in practice

In the current global economic situation, marked by uncertainty and saturation of established markets, more and more companies are looking for unconventional destinations for their growth. Expansion into jurisdictions that are not an obvious choice at first glance can bring not only new business opportunities, but above all a key strategic advantage—risk diversification.

Turkey, Oman, and Nigeria represent three different but strategically important alternatives. Turkey serves as an established manufacturing and logistics hub at the crossroads of continents. Oman is emerging as a politically stable and rapidly modernizing gateway to the markets of the Middle East and Africa. Nigeria, as the most populous African country, offers access to a massive consumer market and is the entry point to the Economic Community of West African States (ECOWAS).

However, success in these diverse environments is not a matter of chance. It requires precise legal and strategic preparation that can minimize the risks associated with an unfamiliar regulatory environment and maximize return on investment. ARROWS lawyers specialize in this area and, thanks to our international network, deal with issues related to entering these complex markets on a daily basis.

Turkey: A dynamic gateway between Europe and Asia

Located at the strategic intersection of Europe and Asia, Turkey is an extremely attractive destination for Czech companies. Its economy is undergoing a phase of stabilization and offers a robust industrial base, a skilled workforce, and significant government incentives for foreign investors.

Economic outlook and investment climate 2025

After a period of high inflation and economic volatility, Turkey has embarked on a path of macroeconomic normalization with the aim of restoring investor confidence. The World Bank forecasts stable, albeit modest, GDP growth of around 3.1% for 2025. This development signals a gradual stabilization and creates a more predictable environment for long-term investment.

A key advantage for Turkey is its membership in the customs union with the European Union since 1995, which greatly simplifies trade and eliminates customs duties on most industrial products. The country's strategic location also allows it to serve the markets of Europe, the Middle East, North Africa (MENA), and Central Asia, representing a market of 1.3 billion consumers, within a few hours by air.

Key sectors for investment include the traditionally strong automotive industry, electronics and household appliance manufacturing, as well as the rapidly growing defense industry, information technology, and renewable energy sector. The Turkish government actively supports these strategic areas through a generous system of investment incentives, which include corporate income tax reductions, VAT and customs duty exemptions, and special support for research, development, and green technologies.

Establishing a subsidiary in Turkey – Legal procedure

For foreign investors, the two most relevant forms of commercial companies are the limited liability company (Limited Şirket - LLC) and the joint-stock company (Anonim Şirket - JSC). Both forms allow 100% foreign ownership, and their establishment is relatively efficient thanks to digitalization.

The minimum share capital for an LLC is set at TRY 10,000, while for a JSC it is TRY 50,000. An important advantage of an LLC is that the capital does not have to be paid up before the company is registered; the law allows it to be paid up within 24 months of incorporation. For a JSC, at least 25% of the capital must be paid up before registration.

The entire registration process is centralized through the MERSIS (Central Registry Record System) online platform, which connects the commercial register, tax office, and other institutions.

Basic steps of the establishment process:

• Preparatory phase: Selection of legal form, unique business name, and preparation of a draft articles of association (statutes) in Turkish.

• Obtaining a tax number: Foreign partners and executives must obtain a Turkish tax identification number in advance.

• Notarization: The articles of association and the executives' signature samples must be notarized.

• Bank account and capital deposit: Opening a corporate bank account and depositing the required portion of the share capital (mandatory for JSCs).
• Registration: Submitting the application and all documents via the MERSIS system to the locally competent Commercial Register.

ARROWS can provide clients with complete preparation of all documentation, including articles of association in Turkish, and guide them through the entire registration process via the MERSIS portal. Do you need help registering a company in Turkey? Write to us at office@arws.cz.

FAQ – Legal tips for starting a business in Turkey

1. As a managing director, do I have to travel to Turkey to set up a company?

Not necessarily. The entire process can be carried out remotely on the basis of a notarized and apostilled power of attorney, which authorizes a representative to perform all necessary actions. ARROWS will prepare the power of attorney for you and represent you throughout the process. For more information, contact us at office@arws.cz.

2. How long does it take to register a company?

Thanks to a high degree of digitization, the actual registration with the Commercial Register can be completed within one day of submitting the complete documentation. The entire process, including the preparation of documents, obtaining tax numbers, and notarial acts, usually takes several weeks. Our lawyers are ready to expedite the process as much as possible – write to office@arws.cz.

Tax system and regulatory specifics

The Turkish tax system is relatively straightforward for companies. The standard corporate income tax (CIT) rate for 2025 is 25%. Companies in the financial sector are subject to a higher rate of 30%.

The standard value added tax (VAT) rate is 20%. Selected goods and services, such as basic foodstuffs and educational services, are subject to reduced rates of 10% and 1%.

For Czech investors, it is crucial that a double taxation agreement (No. 19/2004 Coll. m. s.) is in force between the Czech Republic and Turkey. This treaty effectively addresses issues such as tax residence and reduces withholding taxes on dividends, interest, and royalties, which is essential for tax optimization when repatriating profits.

Doing business in Turkey

Risks and sanctions	How ARROWS can help
Currency volatility (TRY) and financial risks: The risk of depreciation of investments and profits when transferring abroad, which can significantly affect economic results.	Preparation or revision of contracts with hedging clauses and advice on payment structuring. Do you need to revise contracts for the Turkish market? Contact us at office@arws.cz.
Unstable and complex regulatory environment: Sudden changes in legislation can affect business and lead to penalties for non-compliance with new obligations.	Bureaucratic obstacles and lengthy processes: Delays in obtaining specific licenses and permits can jeopardize the start of a project and cause financial losses.
Representation before authorities and regulators to expedite processes and efficiently obtain the necessary permits. Do you need representation before Turkish authorities? Contact us at office@arws.cz.	Representation before authorities and regulators to expedite processes and efficiently obtain the necessary permits. Do you need representation before Turkish authorities? Contact us at office@arws.cz.
Intellectual property protection: The risk of trademark and patent abuse in a highly competitive environment can damage your brand and market position.	Trademark and patent registration with the Turkish Patent and Trademark Office (TÜRKPATENT). Want to protect your brand in Turkey? Write to us at office@arws.cz.

 

Oman: A stable and diversifying hub in the Persian Gulf

In recent years, the Sultanate of Oman has established itself as one of the most attractive and stable investment destinations in the Persian Gulf region. Thanks to its strategic vision, political stability, and proactive reforms, it offers a secure and predictable environment for foreign companies.

Oman's Oman Vision 2040 and investment climate

Unlike some of its neighbors, Oman enjoys a reputation as a politically stable and secure country with a neutral and open foreign policy. Its strategic location on the Strait of Hormuz makes it a key logistics hub connecting the markets of the Middle East, East Africa, and South Asia.

The basis for current development is the national strategy "Oman Vision 2040," which aims to massively diversify the economy and reduce dependence on oil and gas revenues. The government is investing heavily in sectors of the future, such as renewable energy, where it has the ambition to become the world's sixth-largest exporter of green hydrogen. Other priority areas include logistics (with the flagship project of the port and free zone in Sohar), technology, tourism, and manufacturing.

For foreign investors, the implementation of the new Foreign Capital Investment Law (FCIL) was a landmark change. This law allows 100% foreign ownership of companies in most sectors and at the same time abolishes the previously valid requirement for minimum share capital, which significantly simplifies and reduces the cost of market entry. Confidence in the Omani economy and its reform course was also confirmed by the World Bank's recent decision to establish a permanent office in the country.

Legal steps to establish a company in Oman

The most common and flexible legal form for foreign investors is a limited liability company (LLC). Thanks to the government portal "Invest Easy," the establishment process is largely digitized and transparent.

Steps to establish an LLC in Oman:

1. Selecting an activity and reserving a name: The process begins with defining business activities and reserving a unique business name online with the Ministry of Commerce, Industry, and Investment Promotion (MOCIIP).
2. Preparing the founding documents: It is necessary to draw up a Memorandum of Association, which defines the structure and purpose of the company.
3. Bank account and capital: Opening a corporate bank account and depositing the initial capital, if required for the activity (requirements vary, for many activities capital is no longer required).
4. Registration: Submitting all documents online via the MOCIIP portal and subsequent registration with the Oman Chamber of Commerce and Industry (OCCI).
5. Obtaining licenses: After basic registration, it is necessary to obtain specific licenses and permits from the relevant ministries or regulators depending on the field of business (e.g., for healthcare, education, tourism)

ARROWS handles the entire process of setting up a company for its clients, including communication with MOCIIP and assistance in obtaining specific licenses and permits for regulated sectors. For an immediate solution to your situation, please write to us at office@arws.cz.

Challenges and solutions: Omanization policy and labor law

The biggest operational challenge for foreign companies in Oman is the government's Omanization policy. This term refers to a set of measures and quotas aimed at increasing the employment of Omani citizens in the private sector. Quotas vary by sector—for example, Omanis must make up 60% of employees in banking, 35% in industry, and 30% in hospitality.

From April 1, 2025, there will also be a new obligation for all foreign-owned companies to employ at least one Omani citizen during their first year of operation and to register them with the social security system. Failure to comply with these rules may result in penalties, including a ban on issuing work permits for other foreigners.

Omani labor law is generally very pro-employee. It sets a minimum wage (OMR 325 per month), maximum working hours (45 hours per week), entitlement to 30 days of paid leave, and other benefits.

ARROWS provides professional training for management and employees on the specifics of Omani labor law and assists in the preparation of internal guidelines and employment contracts that are in line with the "Omanization" policy. Please do not hesitate to contact our office – office@arws.cz.

Specifics of the Omani market

Risks and penalties	How ARROWS can help
Mandatory employment quotas (Omanization): Failure to comply may result in a ban on hiring foreigners, fines, and restrictions on activities on the Oman Business Platform.	Legal consultation and preparation of HR strategy in accordance with Omanization policy and labor law. Do you need legal assistance with labor law in Oman? Contact us at office@arws.cz.
Bureaucratic processes and lengthy approvals: Despite digitization, the processes for obtaining specific licenses in regulated sectors can be time-consuming.	Representation before registries and regulators for efficient and fast processing of all permits and licenses. Want to speed up your entry into the Omani market? Write to office@arws.cz.
In-Country Value (ICV) policy: Preference for local suppliers and services in government contracts can disadvantage new foreign companies without local ties.	Legal opinions and advice on structuring bids for public tenders and setting up a local supply chain. Want to know what your legal options are? Write to office@arws.cz.
Restrictions in certain sectors ("negative list"): In certain strategic areas (e.g., defense, mineral exploration), restrictions or bans on 100% foreign ownership still apply.	Legal analysis and advice on choosing the right business activity and company structure to avoid regulatory barriers. Need a legal analysis? Contact us at office@arws.cz.

Nigeria: Gateway to the dynamic market of West Africa (ECOWAS)

Nigeria is the archetype of a high-risk market with enormous potential. For bold investors who can navigate its complex environment, it offers access to the largest consumer market on the African continent and a strategic position for expansion throughout the region.

The potential and risks of Africa's largest economy

With a population of over 227 million, Nigeria is a demographic giant, and its young and growing population represents enormous consumer potential. The country's economy is the largest in West Africa, and Nigeria plays a dominant role in the Economic Community of West African States (ECOWAS), making it a natural gateway to this regional market of more than 400 million people.

The new government that took office in 2023 has launched a series of bold economic reforms, including floating the currency and removing fuel subsidies, with the aim of stabilizing public finances and attracting foreign capital. In response to these measures, the World Bank forecasts GDP growth to accelerate to 4.2% in 2025.

However, investors must be prepared for significant challenges. Among the biggest are inadequate infrastructure, particularly chronic power shortages, which force companies to invest in their own expensive generators. Other risks include the security situation in some parts of the country, high levels of bureaucracy, and currency instability.

Establishing a subsidiary in Nigeria: Procedure and requirements

Foreign companies cannot operate in Nigeria through a mere branch office; the law requires the establishment and registration of a full-fledged local subsidiary. The most common legal form is a private limited company (Ltd).

The registration process takes place at the federal Corporate Affairs Commission (CAC) and is now largely digitized through an online portal. Foreign investors are subject to a specific requirement for a minimum authorized share capital of 100 million Nigerian naira (NGN), which is significantly more than for local companies.

The employment of foreigners is strictly regulated by a quota system known as the Expatriate Quota (EQ). To obtain a work permit for a foreigner, a company must prove that there is no qualified Nigerian expert available for the position. The system also includes an obligation to train a local representative (known as an understudy), who should replace the expatriate in the future.

Thanks to its international network, ARROWS International, which has been built up over ten years, ARROWS ensures a smooth registration process with the CAC and provides comprehensive assistance with the demanding process of applying for an Expatriate Quota. Contact us at office@arws.cz for a tailor-made legal solution.

FAQ – Legal tips for entering the Nigerian market

1. Is it necessary to have a local partner?

The law for establishing a Ltd. does not require a local partner, but it is mandatory to appoint a local company secretary. However, as practice confirms, having a reliable and proven local partner is often a key factor for successful operation in the market, navigating bureaucracy, and establishing business relationships. ARROWS can assist you with due diligence on potential local partners. For more information, please contact office@arws.cz.

2. How complex is intellectual property protection?

Nigeria is a member of the World Intellectual Property Organization (WIPO) and has an established system for registering trademarks and patents. However, the process is formalistic, and it is practically essential for foreign entities to proceed through an accredited local representative. We will ensure the protection of your brand and innovations in Nigeria. Contact us at office@arws.cz.

Tax Revolution 2025: What does the new tax law bring?

Nigeria is on the verge of a major tax reform. From January 2026, the new Unified Nigeria Tax Act will come into force, which aims to simplify and unify the previously fragmented system and bring it closer to international standards.

A key change is the introduction of a 15% minimum effective tax rate (ETR) for multinational corporations and large domestic companies with annual revenues exceeding NGN 20 billion. This measure is in line with the OECD's global BEPS Pillar 2 initiative and introduces a so-called top-up tax – a supplementary tax that will ensure that effective taxation does not fall below the specified minimum threshold.

The standard corporate income tax (CIT) rate remains at 30% (a 0% rate applies to small businesses with a turnover of up to NGN 50 million). The VAT rate is 7.5%, but the reform has significantly expanded the list of basic items to which the zero rate applies, which should mitigate the impact on the population.

This reform fundamentally changes the rules for tax planning and requires a review of existing structures. ARROWS provides legal advice to protect you from penalties and help you optimize your tax structure under the new rules. Our lawyers are ready to help you – write to office@arws.cz.

International expansion with confidence: How ARROWS protects your investments

Successful expansion into such legally, culturally, and economically diverse jurisdictions requires more than just local knowledge. It requires a globally coordinated partner who understands the needs of an international corporation and can ensure consistent quality of service across borders.

Our ARROWS International network, built over ten years, is just such a partner. It ensures that you have access to proven local experts in Turkey, Oman, Nigeria, and elsewhere in the world, who work according to our high standards of quality, speed, and client service. This enables us to effectively manage even the most complex cross-border projects.

Our portfolio of more than 150 joint-stock companies, 250 limited liability companies, and 51 municipalities and counties gives us a deep understanding of the needs and challenges faced by both large corporations and dynamic medium-sized companies. We pride ourselves on the speed and high quality of our services.

At ARROWS, we also believe in the power of networking. We actively connect our clients when we see interesting business or investment synergies. And we are happy to hear your business ideas – we understand that law and business are inextricably linked.

Conclusion: Your partner for global growth

Turkey, Oman, and Nigeria represent significant, albeit challenging, opportunities for strategic diversification and growth. Each of these countries requires a unique strategy based on a deep understanding of local legal, regulatory, and cultural specifics. With an expert legal partner such as ARROWS, complex challenges become manageable steps on the path to international success.

Whether you are considering your first step or already dealing with a specific issue in one of these countries, we are here for you. Our team is ready to provide comprehensive services, from preparing and reviewing contracts, to representing you in court and before administrative authorities, to obtaining the necessary licenses and permits. Contact us at office@arws.cz to arrange an initial consultation, where we will discuss your plans and propose a tailor-made solution.

FAQ – Frequently asked legal questions about establishing subsidiaries abroad

1. How can I effectively repatriate profits from my subsidiary? The repatriation of profits, typically in the form of dividends, is influenced by local legislation and international treaties. For example, the double taxation agreement between the Czech Republic and Turkey reduces withholding tax on dividends. In Oman and Nigeria, it is important to set up the corporate structure correctly and comply with administrative procedures for currency conversion. For tax-efficient profit repatriation, contact our specialists at office@arws.cz.
2. How are my investments protected in the event of political instability or expropriation? Protection is provided by bilateral investment treaties (BITs). These treaties guarantee fair and equal treatment, protection against discrimination, and compensation in the event of expropriation. It is crucial to verify the existence and content of such a treaty between the Czech Republic/EU and the target country. ARROWS performs an analysis of international legal protection for each investment. For more information, contact us at office@arws.cz.
3. What to do in case of a commercial dispute with a local partner? It is essential to have a high-quality arbitration clause in the contract that allows disputes to be resolved through international arbitration (e.g., ICC, LCIA) instead of lengthy and often unpredictable local courts. Both Nigeria and Turkey are signatories to the New York Convention, which facilitates the recognition and enforcement of foreign arbitral awards. We will ensure that your contracts contain robust dispute resolution mechanisms. If you are facing a similar problem, please contact us at office@arws.cz.
4. What are the main differences in corporate governance to watch out for? Requirements for directors, general meetings, approval processes, and management responsibility vary from country to country. For example, in Nigeria, a local company secretary is mandatory. In Turkey, strict rules apply to joint-stock companies. In Oman, emphasis is placed on formal documentation of meetings. We provide comprehensive advice on corporate governance to ensure that your subsidiary operates in accordance with local laws. For a consultation, please email us at office@arws.cz.
5. Can ARROWS also help with connecting to other services, such as accounting or office search? Yes. Thanks to our ARROWS International network and many years of experience in the market, we can connect you with proven partners in accounting, taxes, real estate, and other support services that are essential for starting a business in a foreign country. For comprehensive support for your expansion, please contact office@arws.cz.