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the registries in which they are registered will also be submitted to the
trade registry. The goal is that the commercial enterprise and its assets are
transferred as a whole to the newly established commercial company and
that its unity and continuity are ensured.
Conversion of Commercial Companies into Commercial
Enterprises
The TCC also enables a commercial company, bearing a legal
personality, to convert to a commercial enterprise not having a personality.
The legal personality will cease to exist as a result of this conversion.
Both the TCC and the Trade Registry Regulation provisions hold that the
commercial enterprise to be registered as a result of the conversion shall
be the continuity of the commercial company.
The TCC introduces a short provision regarding this transaction (Art.
194/3). It states that all shares of the commercial company should be owned
by the person or persons who will operate the commercial enterprise,
and the commercial enterprise to be registered will be registered to the
trade registry and announced in the name of such person(s). Thus, the
shareholders of the converted commercial enterprise will be registered
as the owners of the commercial enterprise. The relevant provision also
specifically regulates the obligations of collective and commandite
companies which will convert.
The TCC does not foresee any provisions on the liquidation of the
converted company, nor on how the legal personality will cease to exist.
The derived conclusion is that a new dissolution without liquidation is
therefore foreseen (such as merger and demerger transactions).
The lack of provisions on liquidation is of significance, especially
with regards to the protection of the creditors’ rights. As there is no
provision stating otherwise, the acquirers of the commercial enterprise
will be personally liable for the debts of the converted company. Pursuant
to the conversion of types authorized by the TCC (Art. 181), a commercial
company may in principle be converted to another commercial company
or a cooperative, but not to an unlimited partnership company. Nonetheless
pursuant to Art. 194, regardless of their liability regime, all commercial
companies (including equity companies) may convert to a commercial
enterprise.