Corporate and Commercial Law

Both types of company may be formed with one or more shareholders; in a limited liability company the number of shareholders may not exceed fifty (Turkish Commercial Code (Türk Ticaret Kanunu – TTK, Law No. 6102) art. 574 (Official text, opens in a new tab)). The statutory minimum capital is higher for a joint stock company than for a limited liability company; these amounts may be increased by Presidential decision (TTK art. 332 (Official text, opens in a new tab)) TTK art. 580 (Official text, opens in a new tab). In a joint stock company, share transfers are in principle unrestricted; the articles of association may impose restrictions (TTK art. 490 (Official text, opens in a new tab)). In a limited liability company, a written agreement certified by a notary and, as a rule, the approval of the general meeting are required (TTK art. 595 (Official text, opens in a new tab)). Please refer to the official text for the current position.

The application for incorporation is initiated through MERSİS, the Central Registry System of the Ministry of Trade. In a limited liability company, the articles of association are signed by the founders in the presence of authorised staff at the trade registry office (Turkish Commercial Code (Türk Ticaret Kanunu – TTK, Law No. 6102) art. 575 (Official text, opens in a new tab)). In a joint stock company, at least one quarter of the shares subscribed for cash must be paid before registration and the remainder within twenty-four months after registration (TTK art. 344 (Official text, opens in a new tab)). In a limited liability company, there is no requirement to pay one quarter before registration; the provisions on joint stock companies apply to the remaining payments (TTK art. 585 (Official text, opens in a new tab)). Please refer to the official text for the current position.

A joint stock company is liable for its debts only with its own assets; shareholders are liable only to the company and only up to the capital they have subscribed (Turkish Commercial Code (Türk Ticaret Kanunu – TTK, Law No. 6102) art. 329 (Official text, opens in a new tab)). Shareholders of a limited liability company are likewise not liable for the company's debts; they are obliged to pay the capital they have subscribed and to fulfil any additional contribution and ancillary obligations under the articles of association (TTK art. 573 (Official text, opens in a new tab)). For public receivables such as tax and social security debts, liability provisions in specific laws may also apply.

A share transfer is made by written agreement, and the parties' signatures are certified by a notary (Turkish Commercial Code (Türk Ticaret Kanunu – TTK, Law No. 6102) art. 595 (Official text, opens in a new tab)). Unless the articles of association provide otherwise, the transfer becomes valid upon approval by the shareholders' general meeting; if the general meeting does not refuse within three months of the application, approval is deemed to have been given. The managers apply for registration of the transfer with the trade registry (TTK art. 598 (Official text, opens in a new tab)). If the application is not made within thirty days, the departing shareholder may apply to the registry directly for the deletion of their name. Please refer to the official text for the current position.

General meeting resolutions that breach the law, the articles of association or the principle of good faith may be challenged by an action for annulment within three months of the date of the resolution (Turkish Commercial Code (Türk Ticaret Kanunu – TTK, Law No. 6102) art. 445 (Official text, opens in a new tab)). The action is brought before the commercial court of first instance (asliye ticaret mahkemesi) at the place of the company's registered office. As a rule, a shareholder who attended the meeting may bring the action only if they voted against the resolution and had their objection recorded in the minutes (TTK art. 446 (Official text, opens in a new tab)). These provisions also apply by analogy to limited liability companies (TTK art. 622 (Official text, opens in a new tab)). Please refer to the official text for the current position.

In a joint stock company, the ordinary general meeting is held within three months of the end of each financial year (Turkish Commercial Code (Türk Ticaret Kanunu – TTK, Law No. 6102) art. 409 (Official text, opens in a new tab)). At this meeting, the financial statements, the annual report, the use of profit and the release of the board members are discussed. In a limited liability company, the ordinary general meeting is likewise held within three months of the end of the financial year (TTK art. 617 (Official text, opens in a new tab)). In a limited liability company, the general meeting is convened at least fifteen days before the meeting date; the articles of association may shorten this period to ten days.

Yes. Applying to a mediator is a precondition for bringing commercial actions for receivables or compensation, actions for the annulment of an objection, negative declaratory actions and actions for restitution where the subject matter is a sum of money (Turkish Commercial Code (Türk Ticaret Kanunu – TTK, Law No. 6102) art. 5/A (Official text, opens in a new tab)). The mediator concludes the matter within six weeks; this period may be extended by no more than two weeks. An action brought without first going to mediation is dismissed on procedural grounds (Mediation in Civil Disputes Act (Hukuk Uyuşmazlıklarında Arabuluculuk Kanunu – HUAK, Law No. 6325) art. 18/A (Official text, opens in a new tab)). Please refer to the official text for the current position.

If the recipient of an invoice does not object to its content within eight days of receipt, the content is deemed accepted (Turkish Commercial Code (Türk Ticaret Kanunu – TTK, Law No. 6102) art. 21 (Official text, opens in a new tab)). The same period applies to a letter of confirmation confirming a contract concluded orally or at a distance. It is important to make the objection in a way that can be proven later. Please refer to the official text for the current position.

Between merchants, notices placing the other party in default, notices of termination and notices of rescission must be given by specific means (Turkish Commercial Code (Türk Ticaret Kanunu – TTK, Law No. 6102) art. 18 (Official text, opens in a new tab)). These means are listed as a notary, registered letter, telegram and registered electronic mail (KEP) bearing a secure electronic signature. The Code also requires every merchant to act as a prudent businessperson in their commercial activities.

The articles of association may grant shareholders a right to withdraw and make it subject to certain conditions (Turkish Commercial Code (Türk Ticaret Kanunu – TTK, Law No. 6102) art. 638 (Official text, opens in a new tab)). If the articles provide no such right, any shareholder may, on just cause, bring an action for a court ruling permitting withdrawal from the company. Even where share transfers are prohibited or the general meeting has refused to approve a transfer, the right to withdraw on just cause is preserved (TTK art. 595 (Official text, opens in a new tab)).