Joint Stock Companies’ Capacity of Becoming a Surety
*
Prof. Dr. H. Ercument Erdem
General
Before the entry into force of Turkish Commercial Code No. 6102
1
(“TCC”) the capacity of joint stock companies with respect to becom-
ing a guarantor or surety was an important issue, which was assessed
within the scope of ultra vires principle (prohibition of transactions out
of a company’s purpose). In accordance with the ultra vires principle,
which was regulated by the abrogated Turkish Commercial Code No.
6762
2
(“Abrogated TCC”), joint stock companies did not have legal
capacity beyond the company’s subject of activity and, thus, transac-
tions concluded beyond their subjects of activity were deemed to be
null and void. The TCC has not included this principle, which limits
the company’s capacity with its subject of activity, by taking into con-
sideration the First Council Directive on Companies no. 68/151 of the
European Economic Community (“EEC”)
3
.
This newsletter article will analyze joint stock companies’ capaci-
ty to be the subject of rights, and the capacity with respect to becom-
ing a surety in accordance with the ultra vires principle under the
Abrogated TCC, the relevant provisions of TCC, and the Court of
Cassation’s decisions rendered with respect to such topic.
Joint Stock Companies as Subjects of Rights
The joint stock companies’ ability to be the subject of rights is
extended following the abandonment of the ultra vires principle.
COMMERCIAL LAW
45
*
Article of February 2015
1
Published in Official Gazette dated 14 February 2011 and numbered 27846, and entered into
force on 1 July 2012.
2
Abrogated on 1 July 2012 by the entry into force of the TCC.
3
http://eur-lex.europa.eu/date of access: 3 March 2015.