Newsletter-21

38 NEWSLETTER 2016 Distinct from other public companies, companies whose shares are not publicly traded must distribute dividends in full and in cash. Therefore, companies whose shares are not publicly traded cannot benefit from the opportunity to distribute dividends in installments. Again, companies whose shares are not publicly traded are not obliged to distribute dividends under certain circumstances. This may arise when the calculated dividend is less than five percent of the capi- tal, according to last annual financial statements that are submitted to general assembly, or if the net distributable profit for such period is less than 100,000 Turkish Liras according to such financial statements (Dividend Communiqué, Art. 7/3). If the company decides not to dis- tribute dividends, this shall be announced to public using the reasons thereof. Conclusion Dividend rights and distribution of dividends in joint stock com- panies is regulated in detail under the TCC. One of the significant pro- visions under the TCC in this regard is TCC, Art. 519/2(c) which, in our opinion, foresees the obligatory distribution of primary reserves. Nevertheless, amendments to this Article by the TCC did not resolve the disagreements concerning this Article. The provisions on divi- dends under the CML consist of more innovative changes. Pursuant to the CML, public joint stock companies are not obliged to distribute minimum dividends, and companies are flexible on determining their dividend distribution policies.