43 / 521
Domination Agreements
*
Att. Ecem Susoy
Introduction
Group companies are regulated for the first time under the Turkish
Commercial Code No. 6102 (“TCC”). Although no definition of group
companies is specified, its types and principles are expressed in the
TCC. Group companies come into existence when there is more than
two commercial companies that are directly and indirectly affiliated
with a commercial company or an enterprise. In such cases, the parent
company constitutes the dominant company and the dependent com-
panies constitute the subsidiary companies.
The concept of dominance has been introduced with the regulation
of group companies. Dominance may be established through share-
holding, contractually and in other ways. This newsletter article treats
contractual dominance and domination agreements, which establish
such contractual dominance.
Definition of Domination Agreements
Domination agreements are defined in Article 106 of the Trade
Registry Regulation (“Regulation”) published in the Official Gazette
dated 27.01.2013 and numbered 28541. A domination agreement is
defined as an agreement whereby one of the parties has unconditional
authority to instruct the managing body of the other party which is an
equity company; without there being any direct or indirect participa-
tion relationship between said parties.
In the domination relationship, the company giving instructions is
the dominant company and the one receiving instructions is the sub-
COMMERCIAL LAW
27
*
Article of January 2014