Share Transfers in Turkey
Share transfers in capital companies in Turkey can be a complex subject due to the numerous rules and procedures governing transfer transactions. Joint Stock Companies, noted as “Anonim Şirket” in Turkish (JSC), are a type of capital company provided for by the Turkish Commercial Code, similar to ‘Corporations’ in the U.S. and ‘Société Anonyme’ in Europe.
These JSCs have certain differences with other types of capital companies (such as Limited Liability Companies) and are generally the preferred vehicle for capital investments in Turkey due to their advantages. please refer to our article regarding company formations for more details here (also available via Mondaq). Since it is one of the most common company types in Turkey, it is important to know the rules and procedures governing share transfers.
Procedures for Share Transfers
There are numerous different provisions governing share transfers in capital companies. The foremost principle, the principle of free transfer, shall be applicable to shares of JSCs, meaning that as a rule, JSC shares can be transferred freely to third parties.
Due to this principle, one might assume that a simple transfer of a share in a JSC (as per the rules and procedures outlined in Part-I) shall be sufficient to claim the shareholder status in any JSC. Unfortunately, this is not the case, as the Turkish Commercial Code includes several other provisions that sets forth additional procedures to be followed in order to be deemed as a shareholder before a JSC.
LLC share transfer are even more complex as the law requires registration for LLC shares. Please refer to our 3-part publication covering issues regarding JSC share transfers here: Part–I, Part-II and Part-III.