A range of legislative changes have been made in Turkey
following the attempted coup on 15 July 2016, as well as changes to
the structures and compositions of government, military and
judicial bodies. Notable aspects for companies include bankruptcy
suspension requests being deemed invalid during the national three
month State of Emergency, as well as increased powers for guardians
appointed to companies under investigation.
Bankruptcy postponement requests suspended
According to the Bankruptcy and Enforcement Law No 2004,
companies with share capital, as well as cooperative associations,
can request bankruptcy if their liabilities exceed their assets. If
the company or cooperative's financial status can improve, it
can request bankruptcy be suspended by submitting an improvement
plan. However, the Law states that postponement applications cannot
be made and will be declined by the Courts in any case during the
State of Emergency.
There have recent also been drastic changes to the Turkish
bankruptcy postponement regime, which will come into effect once
the State of Emergency is lifted.
Council of State memberships terminated
Turkey's Council of State is the Superior Court for
administrative justice and, as such, is the Court of last instance.
It reviews all rulings rendered by Administrative Courts, unless
laws specifically refer them to other judicial authorities.
Legislative amendments terminated the memberships of all members
of the Council of State, except the President, Deputy President,
Chief Prosecutor and Department Head of Council of State. New
members of the Council of the State were elected on 25 July
Powers of guardians assigned to companies are
Under the Law of Criminal Procedure, companies can be appointed
a guardian if there is a strong suspicion that the crime under
investigation was committed by the company. According to the
changes, these guardians also now receive powers over:
Compensation claims against guardians will be able to be made
from the State. The State will have one year to recoup such
compensation from malicious guardians.
Please see these links for the full text of relevant legislation
(only available in Turkish).
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