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COMMERCIAL LAW
111
Squeeze-Out in Group Companies
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Att. Leyla Orak
Introduction
The Turkish Commercial Code No. 6102
1
(“TCC”) enables squeeze-
out and exit rights of shareholders from joint stock companies in certain
circumstances.
These rights are important in ensuring a balance of interest within
the company. The legislative policy aims on the one hand to audit and
control competition, and to control companies in a given market, but on
the other hand encourages strong companies with a strong presence in
the international arena (for example facilitated mergers and acquisition
processes and tax incentives)
2
. The right to squeeze-out a minority with a
material dissent of opinion also serves to establish a peaceful environment
within a corporation and serves to establish a strong, concentrated
company.
The TCC regulates the right to squeeze-out in company mergers and
within group companies. Moreover, in the event the minority requests
dissolution of a company for just cause, the TCC enables the courts to
rule on squeezing out the claimant minority. One of the squeeze-out rights
regulated under the TCC is specific to group companies. This newsletter
article is in relation to the squeeze-out right regulated under Art. 208
granted to controlling companies.
In General
Apart from the annulment of shares in the event shareholders failed
to fulfill the obligation to fully pay up the share capital subscription, the
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Article of November 2013
1
Official Gazette, 14 February 2011, No. 27846. TCC entered into force on 1 July 2012.
2
Assit. Prof.
Akın
, TTK m. 208 Kapsamında Anonim Şirketlerde Azlığın Ortaklıktan
Çıkarılması (Squeeze-Out of Minority from Joint Stock Companies under TTK Art.. 208),
Gazi Üniversitesi Hukuk Fakültesi Dergisi (Gazi University Journal of the Faculty of Law) V.
XVII, Year 2013, No. 1-2, p. 2.