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COMMERCIAL LAW
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company is abroad, with the registry where the headquarters of the
subsidiary company is located. If the agreement is in a foreign language, a
notarized Turkish translation must be submitted to the registry. Registries
have the right to request other documents within this scope.
Obligations of Notification, Registration and Announcement
Pursuant to Article 198 of the TCC, in the event that an undertaking
directly or indirectly holds 5, 10, 20, 25, 33, 50, 67 or 100 percent of
the shares of a company, or its shares fall under such percentages, the
undertaking should inform the said company and the relevant authorities
of the situation within ten days as of the completion of the relevant
transactions. The acquisition or disposal of shares at the percentages
stated above should be indicated in the annual activity and audit reports
under a separate title and should be announced on the company’s web site.
Additionally, there are specific obligations of provision of information set
forth for the members of the board of directors and other executives of both
the undertaking and the company. Pursuant to Article 198 of the TCC, all
rights, including any voting rights arising from the acquisition of shares,
shall be suspended unless and until the registration and announcement
obligation is satisfied.
TRR Article 107/2 requires the obligation to notify only if the
undertaking, or the company acquiring or disposing of the shares, is part
of a group company. Such a provision highly restricts the notification
requirement set forth under the TCC. When considering the limitation of
the TRR’s definition of group companies, the scope of this notification
obligation provided by the law is further restricted. In other words,
pursuant to the TCC, notification to the relevant registry is required for
share transfer transactions exceeding the designated thresholds, whereas
pursuant to the TRR, the presence of a group company (a structure
comprising three companies) will be confirmed first and serving a
notification shall be brought into the agenda accordingly.
Pursuant to the TRR, where there is an indirect affiliate relationship,
notification with respect to all of the undertakings or companies exceeding
the threshold or dropping below the threshold may be conducted by one
of them. If the notification is not served, the rights arising out of the