Law No. 7511 on the Amendment of the Turkish Commercial Code and Other Certain Codes Has Been Published

Law No. 7511 on the Amendment of the Turkish Commercial Code and Certain Other Laws ("Law No. 7511") was published in the Official Gazette No. 32560 on May 23, 2024.

While this Law No. 7511 primarily aims to amend the Turkish Commercial Code numbered 6102 ("Turkish Commercial Code"), it also includes changes to various other laws such as the Law on the Protection of Competition, the Law on the Protection of Consumers, the Law on the Union of Chambers and Commodity Exchanges of Turkey, the Law on Cooperatives, and the Law on the Regulation of Retail Trade.

Specifically, in relation to the Law on the Protection of Consumers and the Law on the Regulation of Retail Trade, administrative sanctions have been introduced against actions such as excessive pricing and refusal to sell. Additionally, amendments to the Law on the Protection of Competition impose a notification obligation on the Competition Board during investigations. Beyond these changes, significant amendments to the Turkish Commercial Code under Law No. 7511 are examined below.

Previously, in joint stock companies, board members were elected for three years, while the chairman and vice-chairman were elected annually. Law No. 7511 removes the requirement for annual elections for the chairman and vice-chairman, thereby aligning their terms with those of the board members.

The authority to appoint and dismiss branch managers in joint stock companies is no longer an inalienable duty and authority of the board of directors. However, there are no changes regarding the inalienability of the board's authority to appoint and dismiss other managers, and this practice will continue.

Under the current practice, the authority to convene the board of directors is solely granted to the chairman. Law No. 7511 extends this authority to all board members. With this change, any board member can request a meeting in writing, and the chairman must call the meeting within thirty days of receiving the request if a majority of the board members submit a written request.

Lastly, Article 17 of Law No. 7511 adds a temporary article to the Turkish Commercial Code. The added temporary article states:

"Joint stock companies and limited liability companies with capital below the minimum required capital must increase their capital to the amounts specified in Articles 332 and 580 by 31/12/2026; otherwise, they will be deemed to have dissolved. Non-public joint stock companies that have adopted the registered capital system with a minimum issued capital of two hundred and fifty thousand Turkish Liras must increase their initial capital and issued capital to five hundred thousand Turkish Liras by the specified date, or they will be deemed to have exited this system. No quorum is required for general assembly meetings held to increase the capital to the amounts specified in Articles 332 and 580, decisions will be made by the majority of votes present at the meeting, and no privileges can be used against these decisions. The Ministry of Trade may extend the deadline specified in the first paragraph by one year at most, twice."

Included Thus, with the provisional article added, it is stated that joint stock and limited liability companies whose capital is below the new minimum capital amount must adapt to the new capital order until 31.12.2026, otherwise they will be deemed to have dissolved. Additionally, no quorum will be required for general assembly meetings to increase the capital to the specified amounts, decisions will be made by the majority of votes present, and no privileges can be exercised against these decisions.

The amendments made under the Turkish Commercial Code in accordance with Law No. 7511 will come into effect on the date of their publication.

You can access the Law No. 7511 here. (In Turkish)

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