Kayseri Bar Association Lawyer Seyit Halil Yüzgeç provided important information on the corporation law, company types and partnership termination.
It is the branch of commercial law addressing the establishment, capital structures, types, partners, management and operation, representation, termination and liquidation of legal entities (company) formed by two or more persons to be engaged in commercial activities.
The type of companies regulated pursuant to the Turkish Obligations Law is unincorporated company, and companies of that type are not legal entities while partnerships regulated according to the Cooperative Law are legal entities. Therefore, cooperatives take place between commercial companies. All of the companies regulated in the Turkish Commercial Law are legal entities and they become legal entities once they are registered in the trade registry and bear the title of merchant as of then.
5 different types of companies may be established pursuant to the Turkish Commercial Law no. 6102, however; the most common types of company across the world are Joint-Stock and Limited Liability companies. Both of these companies may be established with a minimum of one partner. The liability of partners is as much as the capital they undertake to invest. Establishment of a limited liability company requires a minimum of 10 thousand TL while establishment of a joint-stock company requires a minimum of 50 thousand TL. Non-public limited liability companies that have accepted the registered capital system require a minimum of 100 thousand TL as the capital.
There are not any obstacles preventing the entire or some of the partnerships of joint-stock and limited liability companies from being foreign. Even though there are differences in the original capital, the establishment of joint-stock or limited liability companies is nearly the same.
Partnerships may be terminated by courts in case of failure to achieve the purpose in the deed of partnership or the purpose being impossible to be achieved, expiry of the contract, request of one of the partners for justifiable reasons, decision of all partners to terminate the partnership, termination notice even by one partner, dissolution of partnership due to the death of one of the partners.
Nothing else is stipulated in case of failure to achieve the purposes in the deed of partnership or the achievement thereof becoming impossible, the expiry of the contract; and there is an obligation to post a notice at least 6 months earlier in case of an unanimous decision of all partners to terminate and when one of the partners posts a termination notice. If activities continue even though the deed of partnership expires, the partnership then turns into a partnership of indefinite duration.
Joint-Stock and Limited Liability companies terminate when the articles of incorporation expire, in case of presence of any reasons for termination envisaged in the articles of incorporation, failure to achieve the management goal or the achievement thereof becoming impossible, general assembly resolution on the liquidation of the company (in accordance with the article 421(3-4) of the Turkish Commerce Law), decision on the bankruptcy of the company and in other special cases specified in the laws. If the company continues its activities despite the duration determined in the contract, the company then continues its existence for undetermined period of time.
Company termination procedures are performed with or without liquidation. Subsequent to liquidation procedures, legal entity of the company ends, is cancelled from relevant registries and all accounts are closed by terminating the activies of the company. The company ceases to exist entirely in case of bankruptcy.
Attorney Seyit Halil Yüzgeç (SHY) Law Office opened its first office in 2001.
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