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COMMERCIAL LAW

The registration of the resolution of division has many effects and

consequences. Firstly, the division becomes valid by being registered.

On the other hand, universal succession is realized at the moment of

registration and the assets and liabilities registered at the inventory are

acquired by the transferring company. Finally, with regards to complete

division, the transferred company is dissolved by registration.

Article 179 of the New TCC which regulates the finalization of

the division provides the registration, however, does not mention the

publication of the resolution. On the other hand, the provisions with

regards to mergers regulate both registration and publication. At this

point, Article 35/3 of the New TCC shall be taken into consideration.

Pursuant to the said article, registered matters are also published, unless

the law or by-law provides the contrary. As a result, in my opinion, the

resolution pertaining to division shall also be published.

Authorization by the Competition Board

Regarding mergers, the provisions of the Act on Protection of

Competition (the “Act”) are

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regulates the mergers and acquisitions, and a communiqué issued in order

to implement this article foresees the obligation to obtain the authorization

of the Competition Board in order for mergers and acquisitions, exceeding

certain determined thresholds, to become valid. Shall the provisions of the

Act governing mergers be applicable to divisions? There are no express

provisions in the New TCC which foresee that the provisions of the Act

shall be reserved regarding divisions. The Justification of the New TCC

does not include any explanation with regards to the applicability of the

competition rules. I am of the opinion that the provisions of the Act shall

be applicable on divisions as well, since the division transaction essentially

includes a merger; either a newly incorporated company or a currently

existing company shall acquire. Furthermore, in order to refer to a merger

transaction on the terms of competition law, the determining factor is not

the transfer of shares and assets. The important factor is the change of

control of the merging companies. So long as the shareholder structure in

an asymmetrical division transaction can be structured in a way resulting

in a change of control, the authorization system stipulated under the Act

shall be applicable in case of divisions as well.