AMENDMENTS TO THE TURKISH COMMERCIAL CODE
This Newsletter outlines the amendments made to certain articles of the Turkish Commercial Code numbered 6102 and dated 13 January 2011 (in Turkish, “6102 sayılı Türk Ticaret Kanunu”) (the “TCC”), with the Law Amending the Turkish Commercial Code and Other Laws numbered 7511 (in Turkish, “7511 sayılı Türk Ticaret Kanunu ile Bazı Kanunlarda Değişiklik Yapılmasına Dair Kanun”) (the “Amending Law”) published in the Official Gazette numbered 32560 and dated 30 May 2024.
The main amendments to the TCC consist of (i) modification to the board of directors’ obligation to appoint the chairman and vice chairman among its members annually by way of allocation of duties, (ii) the removal of the authority to appoint and dismiss branch managers and authorized signatories from the scope of the powers of the board of directors that cannot be transferred or delegated, (iii) the introduction of new procedures for convening the meetings of the board of directors in cases where its members request a meeting, and (iv) none award of the judicial expenses and attorney fees against the relevant registry in revival lawsuits filed due to the debts of the companies de-registered from the trade registry.
Article 366 of the TCC regulates the allocation of duties of the board of directors. Additionally, the chairman and vice chairman of the board of directors may be elected in accordance with the term of the board of directors. However, the requirement to elect the chairman and vice chairman annually has been abolished and this abolishment enables the chairman and deputy chairman of the board to be elected concurrently with their respective terms of service, i.e. for a maximum term of 3 years.
The power to elect and dismiss branch managers and authorized signatories has been removed from the scope of the duties and powers of the board of directors that cannot be transferred or delegated. Accordingly, article 375 of the TCC provides the irrevocable responsibilities and powers of the board members and clause (d) of the first paragraph of the said article regulates the appointment and removal of managers and individuals with equivalent roles, along with those possessing signature authority, within these powers.
Article 392 of the TCC envisages the right of each member of the board of directors to request the chairman to call the board of directors for a meeting. However, the said article has been modified in line with the right to information and inspection. With the amendments, in the case of meeting requests made by the majority of the board of directors, the obligation to call the board of directors to a meeting shall be made by the chairman of the board of directors within thirty days (30) as from the date of receipt of such request. If the board of directors is not called to a meeting by the chairman, or if the chairman/deputy chairman cannot be reached, the call can be made directly by the requesting members. Hence, it should be kindly noted that, with the amendment, it is aimed to establish an alternative procedure for convening the meetings of the board of directors.
For meetings convened upon request, the first paragraph of article 390 of the TCC regarding meeting and decision quorums shall apply:
“Unless a heavier provision is stipulated in the articles of association, the board of directors shall convene with the majority of the total number of members and shall make decisions with the majority of the members present at the meeting. This rule also applies if the board of directors meets electronically.”
The Amending Law introduces a new regulation that the judicial expenses and attorney fees will not be granted to the relevant trade registry directorates in revival lawsuit of companies and co-operatives (in Turkish, “şirketin/ kooperatifin ihyası davası”). As from the effective date of the Amending Law, it will no longer be possible to grant judicial expenses and attorney fees against the trade registry directorates obliged to participate in revival lawsuits filed by the creditors and those who claim to have legal interests because of the debts of the companies de-registered from the trade registry.
These regulations entered into force on 29 May 2024, as from the date of publication in the Official Gazette.
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