NEWSLETTER-2019-metin

44 NEWSLETTER 2019 sued by the target company, if applicable, the share certificates are duly issued, and other similar matters directly concerning the shares. However, as explained above, as purchasers’ aim with share purchase agreements is usually the acquisition of enterprises of the company to which the shares belong, the qualifications concerning the company and its activities also have crucial importance for the purchaser. Therefore, share purchase agreements contain an extensive scope of representations and warranties of the seller. The scope of these representations and warranties varies depending on the parties’ interests and the agreement reached 3 . Accordingly, representations and warranties stipulating certain qualifications of the target company, such as the target company, are duly established, it holds the necessary permits and licenses to carry out its activities, it has the right to use the assets necessary to maintain its activities in accordance with the legislation, and it conducts its ac- tivities in accordance with the legislation, and are included in the share purchase agreements. In the event that the representations and warranties stipulated under the agreement concern the target companies’ qualifications, not the shares (due to the fact that shares constitute the fundamental subject of the share purchase agreements), the matter as to whether these might be deemed as specific qualifications (“representations and warranties”) under Article 219/1 of the TCO, is controversial 4 . Within this context, Tekinalp opines that in the event that the ma- jority of the shares of the target company are transferred, the seller is liable for the material and legal defects, and the insufficiencies of the assets 5 . 3 Buz, Vedat : “Ortaklık Paylarının Devrinde Ayıba Karşı Tekeffül Hükümlerinin Uygulanabilirliği Sorunu” Banka ve Ticaret Hukuku Dergisi, V. 35, No. 3, 2019, p. 70. 4 For the opinion that such representations are not deemed under the scope of Ar- ticle 219 of the TCO, please see. Ayoğlu , p. 257. For a different view, please see Esin, İsmail G.; Lokmanhekim, S. Tunç . “M&A Transactions Under Turkish Law”, p. 39-40 (in Ayoğlu, p. 257). 5 Poroy/ Tekinalp/ Çamoğlu , Ortaklıklar Hukuku I, Rewritten 14th ed., p. 626- 627.