Obligation To Contract an In-house Lawyer in Société Anonym in Turkey

According to Turkish Law, a Societe anonym with a minimum share capital of 250,000 TL is obliged to contract a legal consultant.

According to Turkish Law, a societe anonym (which is an Anonim Şirket in Turkish/a joint stock company) should have a minimum share capital of 50,000-TL. The company is not allowed to have a lower share capital throughout its time of activity.

Anonim şirkets that have share capitals five times higher than this minimum amount are obliged to hire inhouse legal consultants as per Article 35 of Law Number 1136, which stipulates the provisions regarding the practice of lawyers/attorneys-at-law in Turkey.

With a simple calculation, it is clear that this regulation covers the Anonim Şirkets with share capitals higher than 250,000-TL. You can check the link of Central Bank of Turkey http://www.tcmb.gov.tr/wps/wcm/connect/tcmb+en/tcmb+en/main+page+site+area/today to see the exchange rates of currency.

Likewise, house-building societies (yapı kooperatifi in Turkish) which have 100 or more than 100 members are obliged to hire legal consultancy services as per the same regulation.

Upon any contrary action, the company shall be fined by Prosecuting Attorney for every month the company avoids hiring legal service; each monthly fine to be the sum of two monthly gross minimum wages. (Monthly gross minimum wage has been set as 1,134 TL for the second six months in Turkey. Please see the Relevant link in Turkish.

Russia to buy fresh fruit, vegetables and dairy products from Turkey

According to the information gathered from the Turkish press, within the context of of the sanctions related to the dispute regarding Ukraine, Russia has lately declared that Russia will stop purchasing meat, fish, fruits, vegatables and dairy products from EU, USA, Canada, Australia and Norway for one year and increase their purchases from Turkey in those areas. It is reported that Russia has contacted Turkish officials for further details about the purchases. 

Upon the developments, Union of Fresh Fruit and Vegertable Exporters in Turkey made a declaration that fresh food companies in Turkey should not be in big expectations about the declaration of Russia, stating that with the data given, there would not be a big gap in the Russian market of vegetables and fruits and the possible gap to occur can be filled in by Turkey very easily and furthermore Russia might meet those needs from other countries as well.

The differences between Societé Anonym and Limited Liable Company briefly in Turkish Law

The differences between Societé Anonym and Limited Liable Company briefly in Turkish Law.

Societé Anonym Anonim Şirket	Limited Liable Company Limited Şirket
Minimum share capital not less than 50,000 TL One share cannot be less than 1 Kuruş (1% of 1 TL)	Minimum share capital not less than 10,000 TL Minimum share value : 25TL
Articles of Association in written form certified by Notary Public For establishment, no permission required from the Ministry (exceptions)	Articles of Association in written form certified by Notary Public For establishment, no permission required from the Ministry (exceptions)
Minimum one shareholder (either entity/judiciary person or real person) Unlimited number of shareholders	Minimum one shareholder (either entity/judiciary person or real person) Maximum number of shareholders: 50
Can be established for any commercial objective/scope unrestricted by law	Can be established for any commercial objective/scope unrestricted by law
Shareholder entitled to a shareholder certificate (which is a negotiable instrument)	Shareholder entitled to a shareholder  certificate (which is not a negotiable instrument)
Shareholder liable to the company and to the extent of the share undertaken Shareholder not liable of public debts. Shareholder not liable of tax, social security or other debts. Only liability is to pay the total amount undertaken	Shareholder liable to the extent of share undertaken, not liable to third parties for company debts. Shareholder liable of public debts. I.e taxes, social security premiums with his entire asset. For public debts that cannot be paid by the company, the shareholder can be held liable in ratio of their shareholding.
Unless otherwise stated by articles of association, shareholder may transfer his shares by a share transfer agreement. If share certificates or temporary share certificates (ilmuhaber) are issued, these can be transferred by endorsement. It is not necessary to transfer these shares through Notary Public. This transaction does not require registration at Trade Registry.	The transfer of the shares requires permission of the General assembly and a share transfer agreement certified by Notary Public. Share transfer is valid upon the registration of the transfer at Trade Registry.
S.A.’s can be open to public	Cannot be open to public
Board of Directors (Yönetim Kurulu) consists of minimum one member that is elected by General assembly among the shareholders or non-shareholders The board member may be either real person or an entity. Quorum for meeting is the majority of the total number of board of directors. Quorum for taking resolutions is the majority of the members present at the meeting.	The managing director (müdür) is elected by general assembly among shareholders or non-shareholders If there’s more than one managing director (müdür), a board of managing directors is formed and this board takes resolutions by majority votes. If there’s more than one managing director, one of them is assigned as the chief of board.
Board of directors is the legal representative of the company	The legal representative is the managing director or the board of managing directors if there’s more than one managing director.
It is an obligation to hold General Assembly every year. Ministry representative attends the General Assembly in s.a. companies depending on the agenda (such as increasing the share capital, merging etc.)	It is an obligation to hold General Assembly every year. The ministry representative does not attend the General Assembly.
To be continued

General Legal Procedure of Collecting Receivables in Turkey

This is a very brief look on the general legal procedure of collecting receivables in Turkey.

We sometimes see foreign companies seeking legal help for their receivables unpaid by the companies that are resident in Turkey under Turkish law.

In order to have their receivables paid, the companies may follow various legal procedures which may be listed very briefly as follows: 

1. The Company may look for a cautionary attachment from the court including a statement that cautionary attachment/liens can be placed on the immovables, receivables and immovables of the debtor company. Upon the reception of this court award/order, the Company may apply to the execution office for its enforcement.

This is a way that can be used in urgent cases when the debtor company is expected to transfer their assets to third parties to leave them out of reach of potential claimants.

This procedure may be used mostly when the receivable is bound to solid documents such as invoices and/or contracts where the receivable is obvious.

The court binds the enforcement of such award to the payment of 10 or 15% of the disputed amount as a deposit to the court safe as a guarantee. The percentage may change in different cases and different courts and is solely within the discretion of the judge.  This guarantee is for the protection of the debtor company in case otherwise is proved upon a detailed judgment in court. 

2.  Another way to collect receivables would be directly filing an execution request for the disputed amount through execution office without prior court award (for cautionary attachment). In this case, usual procedure of execution will be in effect where the execution office shall serve a notification to the debtor company (a payment order) ordering the amount to be paid to the execution office file within a certain period time given. If an objection is raised, the procedure stops and the claiming company is entitled to file a lawsuit for the collection of the disputed amount. The nature of the lawsuit depends on the nature of the objection raised (The objection may be raised against the signature or to the amount). Please also note that the execution procedure may vary in different payment orders as in bills of exchanges like cheques. In checks or bonds the procedure would not stop despite an objection is raised. As this is closely related to the law techniques and covers too much detail, it would be boring and unnecessary to speak about on here. 

3. The third way to have the amount paid would be filing a lawsuit directly at the court requesting the payment of the disputed amount. This lawsuit is carried out by the parties within general legal provisions where all the evidences are examined in detail during judgment.

Please note that this is only a brief general information on the collection of the receivables in Turkey and each case should be interpreted within its own dynamics.

Please do not hesitate to comment here whether this explanation was helpful to you or not.