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Liability of Board Members
The legal liability of the board of directors, as regulated within the
TCC, is fault based and may result from non-compliance with the
obligations arising from the law or the articles of association of the rel-
evant company, as per Art. 553; non-compliance of the representations
and documents with the law, as per Art. 549; misleading declarations
regarding the share capital or knowledge of insolvency, as per Art. 550;
or from value evaluation, as per Art. 551.
Liability Related to Tax Debts
As a rule, a tax claim is first collected from the original tax debtor.
Therefore, tax debts and all related liability of a joint stock company
belongs primarily to the company as a legal entity. However, tax debt
that cannot be recovered from the corporate legal entity, may be collect-
ed from persons and institutions that are responsible for the company
1
.
Pursuant to the Art. 10, par. 1 of the TPC, if a legal entity is a tax-
payer or tax responsible, these obligations must be executed by its
legal representatives. The second paragraph sets forth that taxes and
debts that cannot be collected from the tax responsible may be collect-
ed from the assets of those persons who have a legal obligation to
ensure payment on behalf of the taxpayer.
Liability Related to Public Debts
Pursuant to PCPAC, representatives of legal entities are liable for
outstanding public debts since a legal entity as a board member does-
n’t have personal assets. According to Art. 35 of PCPAC, the represen-
tatives have strict liability if public receivables cannot be collected or
if it may be anticipated that collection will not be possible beforehand.
Liability of the Legal Entity’s Representative as a Board
Member
Representatives of legal entities are primarily obliged to protect
the rights and benefits of the company whose board of directors they
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NEWSLETTER 2014
1
Veliye YANLI
– Banka ve Ticaret Hukuku Dergisi, Anonim Şirketlerin Vergi Borçlarından
Kanuni Temsilcilerin Sorumluluğuna İlişkin Bazı Hususlar, p. 66.