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stock companies which have adopted the authorized capital system and
not open to the public. Capital shall not be reduced under the amounts
stated in the above written article. Capital will be reduced either by
annulling some share certificates of the shareholders or reducing the
nominal value of the shares provided by the General Assembly. In
either procedure the issued share certificates shall be returned to the
company.
Pursuant to Article 475 the required documents shall be submitted
for registration with the trade registry.
Capital Reduction in order to Return the Reduced Amount to
the Shareholders
If the capital is more than the company requires, or if a certain part
of the capital is not used, the general assembly may decide to reduce
the capital and return the reduced amount to its shareholders.
The board of directors shall prepare a detailed report stating the
purpose, scope and procedure of the capital reduction. The company
auditor shall also prepare a report, which states that there are enough
assets to cover the rights and receivables of the creditors. Both reports
shall be submitted by the board of directors to the general assembly for
approval. Following the approval of the resolution for capital reduc-
tion, the report stating the purpose and the procedure of the reduction
shall be registered and announced.
Following the general assembly resolution for capital reduction,
the creditors shall be invited three times at intervals of seven days by
the board of directors. An announcement shall be made pursuant to the
relevant article of the Articles of Association. If a joint stock company
is audited in accordance with Article 397/4 TCC, the announcement
shall also be published on the company’s website. The creditors shall
be invited to notify their receivables and to make a security claim with
said announcement within two months following the third announce-
ment published in the Turkish Trade Registry Gazette.
In order to execute the resolution for capital reduction, the receiv-
ables that are due and payable have to be paid or secured. It should be
noted that since the board of directors submitted a report stating that
there are enough assets to cover the debts or claims, a creditors request
to secure the receivable should be evidenced and justified.
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