The New Developments in the Area of Turkish Commercial Law: The Draft Turkish Commercial Code

The New Developments in the Area of Turkish Commercial Law: The Draft Turkish Commercial Code

by Şebnem Işık

Excerpt:

The Turkish Commercial Code (TCC) has been in force since 1957, while most European countries have adopted new codes or amended their regulations in accordance with economic developments throughout the world. Because the TCC has not been significantly amended for more than 50 years, it is essential for the Turkish legal environment to change and Turkey is now very close to adopting a new, reformed commercial code. Major reforms to be introduced with this Draft Commercial Code (Draft Code) affect joint stock and limited liability companies. Specifically, these reforms include the establishment of companies with one shareholder, holding on-line meetings, and the regulation of criminal liabilities in corporate issues.

In 2006, the Turkish Ministry of Justice formed a commission composed of scholars, judges, and practitioners for the preparation of the Draft Code. This decision was spurred by economic and legal developments taking place in Turkey since the 1950s, and in the wider world. The Draft Code aims to be in line with the European Union (EU) legislation and to better meet the requirements of both foreign and local investors.

The principles of transparency, equity, and liability are the cornerstones of the Draft Code. The main purpose of the Draft Code is to integrate modern corporate governance rules into Turkish commercial life. With regard to corporate governance, there are major amendments to be made to the structures and governance of all types of companies in order to provide a sustainable and reliable legal environment both for foreign and local investors. The Draft Code will be the fundamental regulation for all types of joint stock companies (JSCs), both public and private.

Şebnem Işık outlines the reforms that will take place with the implementation of the Draft Code, particularly with respect to JSCs and limited liability companies (LLCs). [footnotes omitted]

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Şebnem Işık is the partner responsible for the corporate and commercial department and telecommunication and energy practice groups of Mehmet Gun & Partners. She focuses on corporate and commercial law, code of obligations law, and preparation and negotiation of contracts, with special expertise in telecommunication and energy sectors. Her multi-faceted practice includes merger and acquisition transactions, project finance, privatizations, concession agreements, public and private offerings of major multinational and Turkish companies, and the establishment and liquidation of companies.