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New regulations are introduced by the 7th paragraph added to Art.
371 concerning the function and scope of the internal directive regu-
lated under Art. 367 TCC. According to the added paragraph, the board
of directors may appoint non-representative members of the board of
directors, or persons bound to the company by a labor contract as com-
mercial representatives with limited authority, or other commercial
assistants. This act of the board of directors and the powers and duties
of the appointed persons shall be explicitly reflected in the internal
directive issued in accordance with Art. 367. Following this addition
made to TCC Art. 371, a new opportunity has arisen for the companies
that would like to impose different kinds of limitations on the repre-
sentative authorities of the company, but which are not able to do so by
a signatory circular. Companies that wish to introduce a limitation or
categorization for its representative authorities are able to do so
through a registered and announced internal directive. The legislator
aims to make the internal directive a means of proof by making its reg-
istration and announcement obligatory.
At this point, the reliability on trade registry records (the con-
structive function of the trade registry) must be analyzed. The addition
of the 7th paragraph to Art. 371, enabling the thematic and pecuniary
representative limitations; and determination of the appointed repre-
sentatives in a registered and announced internal directive are impor-
tant with regards to the fact that the company is bound by the transac-
tions concluded with third parties or its right to recourse to its repre-
sentative that carried out the transaction. In our opinion, with this new
regulation, where transactions concluded with third parties on behalf
of the company by a non-representative member of the board of direc-
tors or persons bound to the company by a labor contract as commer-
cial representatives with limited representative authority or other com-
mercial assistants, that are acting upon the internal directive issued in
accordance with the board of directors resolution; the parties to the
transaction will be bound by the limitations introduced with the inter-
nal directive as a result of the constructive function of the Trade
Registry. However, in any case, in order to prevent any conflict, it is
advised that the board of directors resolution, concerning the distribu-
tion and limitations of authority, and the Trade Registry Gazette issue
in which the internal directive is announced must be shared with the
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