Following is the procedure that must be followed in order to
transfer shares in limited liability companies in Turkey:
1- SIGNING A SHARE TRANSFER CONTRACT:
The transferor of the shares and the transferee must first sign
a standard share transfer agreement before a public notary. The
notary certifies the contract after obtaining the signatures of the
parties. Real persons must present their identification
cards/passports and authorized signatories signing on behalf of
legal entities must present their signature circulars along with
their identification cards. Also, the details regarding the company
in which the shares are being sold (tax number, trade registry
number, etc.) and the Trade Registry Gazette showing the current
capital of the said company must be presented to the notary.
Notaries in Turkey use a standard one-page share transfer
contract whereby the transferor sells his/her shares and the
transferee buys such shares with all assets and liabilities (other
than those which are not indicated in official balance sheet). The
transfer is deemed to be completed between and in respect of the
transferor and the transferee upon signing. As an important issue
that should be taken into consideration when signing the contract;
according to the default wording of the contract, the transferor
agrees that he/she has already received the consideration of the
transfer in cash and in full.
Although the parties are allowed by law to make
additions/revisions to the above-mentioned share transfer contract
under the principle of freedom of contract, notaries usually do not
allow so. Therefore, if parties wish to add certain clauses in the
share transfer contract (such as representation and warranties), it
is advised to sign a separate side agreement with such clauses and
have it notarized (although not required). In the said side
contract, a reference must be made to the main share transfer
contract signed before the notary by clearly indicating that the
side agreement will be construed and exercised together with the
share transfer contract.
As a final note, most notaries in Turkey are not familiar with
the concept of selling shares at a price higher than nominal value
and often resist taking any action with regards to such share
transfers. However, it is allowed under Turkish law to sell shares
in a limited liability company at a price higher than their nominal
value and thus to make profit from such sale.
2- ADOPTING A GENERAL ASSEMBLY RESOLUTION:
Subsequent to the conclusion of the share transfer contract, the
General Assembly of the company (in which the shares are being
sold) must convene and adopt a resolution to consent to the share
transfer and have such share transfer recorded in the share ledger
of the company. The transferring shareholder (even if he/she will
no longer be a shareholder in the company after the share transfer)
must also sign the resolution. This resolution can only be valid
with the affirmative votes of the simple majority of the votes
represented in the meeting. The resolution can be signed by proxies
on behalf of the shareholders.
Once the resolution is obtained (and the signatures are affixed
on the resolution), one original copy of the resolution must be
attached to the resolution book of the company and notarized by a
The Trade Registry requires a certain format for the general
assembly resolution; therefore it is advised to review the sample
resolution published on the web site of Istanbul Chamber of
3- APPLICATION TO THE TRADE REGISTRY:
The third stage is applying to the Trade Registry with the
A single page petition (signed by the
authorized representative(s) of the company in which the shares are
Share transfer contract notarized by
the public notary (private additional/side contracts will not be
Two notarized copies of the general
assembly decision (if signed based on a power of attorney, the
power of attorney must also be submitted)
If the transferee is to become a manager in the Company, such
decision must be indicated in the general assembly resolution and
also the required documents for appointing a manager must be
submitted together with the foregoing.
4- UPDATING THE SHARE LEDGER:
As a final step, once the share transfer is successfully
registered by the Trade Registry, the share ledger of the company
(in which the shares are sold) must be updated according to the new
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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