ERDEM-NEWSLETTER-2018-metin

19 COMMERCIAL LAW association that the establishment of usufruct rights on company shares is subject to the company’s approval. That is to say, the company is en- titled to reject the requests for establishment of usufruct rights, based on the same reasons that would justify rejection of share transfers 11 . Article 492/2 of the TCC only refers to Article 491/1, which regulates the share transfer limitations foreseen under the company’s articles of association, but does not refer to the provisions regarding the statutory limitations of share transfers. Therefore, joint stock com- panies cannot refrain from approving the establishment of usufruct rights based on statutory limitations applicable to share transfers, which provide that the not fully paid-in registered share could be only transferred with the approval of the company, and the company is entitled to grant approval if the transferee’s solvency is doubtful, and the transferee fails to provide sufficient collateral requested by the company 12 . Accordingly, the fact that the shares are not fully paid-in, or the solvency of the usufructuary is doubtful, would not constitute sufficient justifications for a joint stock company to not approve the establishment of usufruct rights 13 . Scope of the Right In principle, the usufructuary holds economic rights, such as en- titlement to dividends, as well as managerial rights, such as the right to participate in general assembly meetings, voting rights, rights to access information and examination, and the right to request the annulment of general assembly resolutions. The voting right, right to participate in general assembly meetings, and the right to request annulment of general assembly resolutions, are elaborated upon, below. Voting Right Pursuant to Article 432/2 of the TCC, unless otherwise agreed by the parties, the voting right attached to a share shall be exercised by the usufructuary. However, if the usufructuary fails to act equitably considering the interests of the shareholder, it shall be liable to the 11 Preamble of Article 492 of the TCC. 12 Tekinalp , p. 23. 13 Tekinalp , p. 23.