Share Transfers in Turkey: Legal Procedure, Shareholder Restrictions, Tax Liabilities and Due Diligence

Introduction

Share transfers are among the most common methods of acquiring, selling or restructuring a business in Turkey. Unlike an asset transfer, a share transfer does not normally change the legal identity of the target company. The company continues to own its assets, employ its personnel, remain a party to its contracts and bear its existing liabilities. What changes is the identity or ownership percentage of its shareholders.

This continuity makes a share acquisition commercially attractive. It may allow the buyer to acquire an operating company without individually transferring every licence, contract, employee, receivable or asset. At the same time, it creates a significant legal risk: the buyer indirectly acquires a company together with its historical tax, employment, regulatory, contractual and litigation exposure.

The procedure depends primarily on whether the target is a Turkish joint-stock company (anonim şirket) or limited liability company (limited şirket). The Turkish Commercial Code No. 6102 applies materially different transfer rules to these company types. The articles of association, shareholders’ agreements, regulatory approvals and competition-law requirements must also be reviewed before the transaction is completed. (Ticaret Bakanlığı)

Share Transfer or Asset Transfer?

A buyer may acquire a Turkish business through a share transfer or an asset transfer.

In a share transfer, the buyer acquires the shares of the company. The company remains the owner of its property and continues to be responsible for its debts. Contracts, employees and permits ordinarily remain with the same legal entity, although change-of-control clauses or sector-specific rules may require consent or notification.

In an asset transfer, selected assets and liabilities are transferred directly from the seller to the buyer. Real estate, vehicles, intellectual property, contracts and employees may require separate transfer procedures. The buyer may have greater control over which liabilities are assumed, but the process can be more administratively demanding.

A share acquisition may therefore be structurally simpler, but it usually requires more extensive due diligence because the target company’s historical liabilities remain within the acquired entity.

Share Transfers in Turkish Joint-Stock Companies

The rules applicable to a joint-stock company depend on whether its shares are registered, bearer or represented by share certificates.

Registered shares

As a general rule, registered shares in a joint-stock company are freely transferable unless the Turkish Commercial Code or the company’s articles of association impose restrictions.

Where a registered share certificate has been issued, the transfer is generally completed by endorsing and delivering the certificate to the buyer. The buyer should then apply to be entered in the company’s share ledger.

Registration in the share ledger is particularly important for exercising shareholder rights against the company. A purchaser who has acquired shares but has not been recognised and recorded by the company may face difficulties in attending general assemblies, voting, receiving dividends or exercising information rights.

The board of directors should examine whether the transfer documentation complies with the law and the articles of association before entering the buyer in the share ledger. The board cannot arbitrarily refuse a transfer unless a statutory or contractual restriction applies.

Bearer shares

Bearer share certificates are transferred by delivery. However, under the current regime, transfers of bearer shares must also be notified to the Central Securities Depository of Turkey, known as the Merkezi Kayıt Kuruluşu or MKK.

The notification requirement is important because a person who acquires bearer shares may be unable to exercise shareholder rights against the company until the acquisition has been recorded in the relevant system.

A buyer should therefore not rely solely on physical possession of bearer share certificates. The transaction documents should allocate responsibility for the MKK notification, delivery of the certificates and updating of the company’s corporate records.

Uncertificated shares

Where no share certificate has been issued, the transfer should be documented through a written share transfer agreement or assignment instrument. The company’s share ledger and corporate documents should then be updated.

The buyer should confirm before closing:

Whether share certificates have been issued;
Whether they are registered or bearer;
Whether the certificates are held by the seller;
Whether the shares are pledged, attached or subject to usufruct;
Whether the share ledger is current;
Whether MKK registration is required;
Whether the articles of association restrict the transfer.

Restrictions on the Transfer of Joint-Stock Company Shares

Although free transferability is the general principle, registered shares may be subject to restrictions.

Restrictions may arise directly from the law, the articles of association or a shareholders’ agreement.

Unpaid share capital

Where the subscription price of registered shares has not been fully paid, the company may have a statutory right to refuse the transfer if there are doubts about the buyer’s ability to satisfy the outstanding capital obligation.

A buyer should therefore determine whether the shares are fully paid and whether any unpaid capital commitment will pass with the shares.

Restrictions under the articles of association

The articles may permit the company to refuse a transfer for important reasons connected with:

The company’s business purpose;
Its economic independence;
The composition of its shareholders;
Sector-specific ownership rules;
Family ownership or professional qualifications.

In non-listed companies, the company may in certain circumstances refuse registration by offering to purchase the shares itself, or arranging their purchase by another shareholder or third party, at their genuine value.

Shareholders’ agreement restrictions

A shareholders’ agreement may include:

Right of first refusal;
Pre-emption rights;
Tag-along rights;
Drag-along rights;
Lock-up periods;
Call and put options;
Founder consent rights;
Prohibitions on transfers to competitors;
Change-of-control restrictions.

A contractual restriction in a shareholders’ agreement does not automatically have the same corporate effect as a restriction contained in the articles of association. A transfer made in breach of the agreement may still be valid under corporate law while exposing the transferring shareholder to contractual claims, damages or penalties.

The articles and shareholders’ agreement should therefore be reviewed together.

Share Transfers in Turkish Limited Liability Companies

The transfer procedure for a limited liability company is more formal than the procedure for most joint-stock company shares.

Under Article 595 of the Turkish Commercial Code:

The share transfer agreement must be made in writing;
The signatures of the transferor and transferee must be notarised;
General assembly approval is required unless the articles of association provide otherwise;
The transfer becomes valid upon the required approval;
The general assembly may ordinarily refuse approval without giving a reason;
If the general assembly does not reject the application within three months, approval is deemed to have been granted. (WIPO)

The transfer agreement should also address any supplementary payment obligations, ancillary obligations, non-compete provisions, pre-emption rights, call or put rights, contractual penalties and other obligations attached to the transferred shares.

General assembly approval

Unless the articles remove the approval requirement, the parties must submit the transfer to the general assembly.

The general assembly resolution should clearly identify:

The transferor;
The transferee;
The nominal value and number of the transferred shares;
The new ownership percentages;
The approval of the transfer;
Any amendment to management or representation;
Any amendment required to the articles of association.

The company’s articles may prohibit share transfers or impose additional approval conditions. The transaction should therefore not be signed before the articles have been reviewed.

Trade registry and share ledger

Following approval, the company managers should arrange for the new ownership structure to be entered in the share ledger and registered with the competent trade registry.

The registration application is generally prepared through MERSİS and supported by the notarised transfer agreement, general assembly resolution and other documents requested by the relevant trade registry.

The buyer should not treat notarisation of the agreement as the final stage. A transaction left without corporate approval, share-ledger registration or trade-registry filings may lead to disputes about shareholder status, voting rights, dividend entitlements and responsibility for company debts.

Public Debt Risk in Limited Company Share Transfers

One of the most important risks in acquiring shares in a Turkish limited company concerns public debts.

Under Article 35 of Law No. 6183, shareholders of a limited company may be personally responsible, in proportion to their capital shares, for public receivables that cannot be collected from the company. Where a shareholder transfers a share, the transferor and transferee may be held jointly liable, within the statutory framework, for public debts relating to the period before the transfer. (Gelir İdaresi Başkanlığı)

This means that contractual wording stating that “all previous tax debts belong to the seller” does not necessarily prevent the tax administration from pursuing a person who is legally responsible under public-law rules.

The share purchase agreement may create a contractual right of recourse between the buyer and seller, but it cannot eliminate statutory liability against public authorities.

Before acquiring a limited company, the buyer should examine:

Tax debts;
Social security premium debts;
Administrative fines;
Customs liabilities;
Municipal debts;
Pending tax inspections;
Tax litigation;
Unfiled or inaccurate declarations;
Company records relating to previous shareholders and managers.

Tax clearance documents are useful, but they should not replace a detailed review of the company’s historical compliance.

Management and Representation After a Share Transfer

A transfer of shares does not automatically remove the company’s existing directors, managers or authorised signatories.

The parties should separately determine whether the transaction requires:

Resignation of existing board members or managers;
Appointment of new directors or managers;
Revocation of signature authorities;
Issuance of new signature declarations;
Amendment of internal directives;
Change of bank signatories;
Transfer of electronic banking access;
Change of registered electronic mail and notification authorities;
Update of tax office and social security authorisations.

This is particularly important in transactions where the buyer acquires 100% of the company. Ownership may pass to the buyer while former managers remain legally authorised to represent the company unless separate corporate resolutions are adopted and registered.

Legal Due Diligence Before Acquiring Shares

The buyer should conduct legal due diligence before signing or closing the transaction.

Corporate records

Corporate review should cover:

Articles of association;
Trade registry records;
Share ledger;
General assembly resolutions;
Board or managers’ resolutions;
Share certificates;
Shareholder agreements;
Capital payment documents;
Pledges, attachments and usufruct rights;
Subsidiaries and affiliated companies.

The seller must establish that it validly owns the shares and has the authority to transfer them.

Material contracts

Contracts should be reviewed for:

Change-of-control provisions;
Consent requirements;
Termination rights;
Exclusivity clauses;
Non-compete obligations;
Financial covenants;
Cross-default provisions;
Guarantees and indemnities;
Restrictions on assignment or restructuring.

A contract remains with the target company after a share sale, but the counterparty may have a termination right if control changes.

Employment matters

Employment due diligence should examine:

Employment agreements;
Salary and bonus arrangements;
Accrued annual leave;
Overtime liabilities;
Severance exposure;
Workplace practices;
Social security compliance;
Occupational health and safety;
Pending employee claims;
Key employee retention arrangements.

A share transfer does not itself change the employer because the legal identity of the target company remains the same. However, post-acquisition restructuring or dismissals must be handled separately under Turkish employment law.

Litigation and enforcement

The buyer should review:

Pending court cases;
Arbitration proceedings;
Enforcement files;
Tax disputes;
Administrative proceedings;
Consumer claims;
Employment disputes;
Criminal investigations affecting the company;
Interim injunctions and attachments.

Even where a claim has not yet resulted in judgment, it may materially affect the purchase price or require a specific indemnity.

Assets and intellectual property

Due diligence should confirm ownership and legal status of:

Real estate;
Vehicles;
Machinery;
Trademarks;
Patents;
Domain names;
Software;
Licences;
Customer databases;
Personal data;
Commercial books and records.

Registered ownership should be checked directly with the relevant registry rather than relying solely on the seller’s statements.

The Share Purchase Agreement

A professionally drafted share purchase agreement should do more than identify the number of shares and the price.

Typical provisions include:

Definitions and interpretation;
Sale and purchase of shares;
Purchase price and adjustment mechanism;
Deposit or escrow arrangements;
Conditions precedent;
Regulatory approvals;
Closing procedure;
Seller warranties;
Buyer warranties;
Tax indemnity;
Specific indemnities;
Liability limitations;
Disclosure letter;
Non-compete and non-solicitation;
Confidentiality;
Transitional services;
Governing law;
Dispute resolution.

Conditions precedent

Completion may be conditional upon:

General assembly or board approval;
Competition Authority clearance;
Sector-specific regulatory approval;
Bank or lender consent;
Release of share pledges;
Termination of related-party arrangements;
Resignation of managers;
Delivery of tax or social security documents;
Completion of corporate restructuring.

The agreement should clearly distinguish signing from closing. The parties may sign the agreement first and transfer the shares only after all conditions have been satisfied.

Representations and warranties

Seller warranties commonly cover:

Ownership of the shares;
Authority to sell;
Valid incorporation of the company;
Accuracy of financial statements;
Absence of undisclosed liabilities;
Tax compliance;
Employment compliance;
Ownership of assets;
Validity of contracts and licences;
Litigation;
Intellectual property;
Data protection;
Anti-corruption and sanctions compliance.

The agreement should also regulate financial thresholds, limitation periods, claim procedures and maximum liability.

Taxation of Share Transfers

The tax consequences depend on:

Whether the seller is an individual or company;
Whether the target is a joint-stock or limited company;
Whether a share certificate has been issued;
How long the shares have been held;
The seller’s residence;
Any applicable double-tax treaty;
Whether the transaction is commercially connected with Turkey.

For individual sellers, gains from the sale of qualifying share certificates of a fully liable Turkish company may benefit from different treatment where the statutory holding-period conditions are satisfied. Shares in limited companies do not automatically receive the same treatment merely because the company has issued a document representing the shares. (Gelir İdaresi Başkanlığı)

For corporate sellers, participation exemption conditions and the applicable exemption rate should be reviewed based on the law in force at the transaction date.

Share transfer documents relating to joint-stock, limited and certain other capital companies are generally included within the statutory stamp-tax exemption. However, additional agreements containing separate transactions, guarantees or obligations should be reviewed independently.

Tax advice should be obtained before the price, payment mechanism and transaction documents are finalised.

Competition Authority Approval

A share acquisition may require prior permission from the Turkish Competition Authority if it results in a permanent change of control and the applicable turnover thresholds are exceeded.

Following the 2026 amendments, the relevant thresholds include a TRY 1 billion individual Turkish turnover threshold, a TRY 3 billion combined Turkish turnover threshold and a TRY 9 billion worldwide turnover threshold, depending on which notification test applies. The technology-undertaking rules were also amended. (Rekabet Kurumu)

The analysis should consider control rather than merely the percentage acquired. Control may arise through:

Majority voting rights;
The right to appoint directors;
Veto rights over strategic decisions;
Shareholders’ agreements;
Joint control arrangements;
Contractual rights creating decisive influence.

A minority acquisition may therefore require notification if it gives the buyer joint or sole control. Conversely, an acquisition of additional shares may not be notifiable if the buyer already had sole control before the transaction.

Where approval is required, the parties should not complete the transfer before clearance.

Sector-Specific Approvals

Companies operating in regulated sectors may be subject to additional approval or notification obligations.

These sectors may include:

Banking;
Insurance;
Payment services;
Energy;
Telecommunications;
Media;
Civil aviation;
Private education;
Healthcare;
Defence;
Capital markets.

The relevant regulator may examine the buyer’s financial capacity, reputation, ownership structure, foreign investment status and suitability.

Failure to obtain approval may lead to administrative sanctions or invalidate the intended change of control from a regulatory perspective.

Foreign Investors Acquiring Turkish Companies

Foreign individuals and companies may generally acquire shares in Turkish companies, subject to sector-specific restrictions and competition rules.

The transaction documents should address:

Apostille or legalisation of foreign corporate documents;
Sworn translations;
Turkish tax identification numbers;
Ultimate beneficial ownership information;
Foreign investment notifications;
Bank compliance and source-of-funds review;
Sanctions and anti-money-laundering checks;
International payment arrangements.

A foreign corporate buyer may also need board resolutions, certificates of incumbency, commercial registry extracts and powers of attorney issued in accordance with the laws of its home jurisdiction.

Post-Closing Actions

After completion, the parties should ensure that the legal and operational transition is fully implemented.

Post-closing steps may include:

Updating the share ledger;
Completing MERSİS and trade registry filings;
Registering the sole shareholder where required;
Appointing new directors or managers;
Updating signature authorities;
Notifying banks;
Changing internet banking access;
Updating tax and social security authorisations;
Reviewing licences;
Notifying contractual counterparties;
Updating beneficial ownership information;
Taking control of corporate books, seals, electronic accounts and records.

For companies established from 1 January 2026, statutory corporate ledgers falling within the applicable scope are maintained through the Electronic Commercial Ledger System, making control of electronic corporate records increasingly important. (Ticaret Bakanlığı)

Common Risks in Turkish Share Transfers

The most common problems include:

Assuming that notarisation alone completes a limited company share transfer;
Failing to obtain general assembly approval;
Not examining restrictions in the articles of association;
Failing to update the share ledger;
Ignoring public debt liability of limited company shareholders;
Completing the transaction before Competition Authority approval;
Leaving former directors or managers authorised after closing;
Failing to review share pledges and attachments;
Paying the full purchase price without escrow or security;
Relying on general warranties without conducting due diligence;
Failing to regulate historical tax and employment liabilities;
Using a shareholders’ agreement that conflicts with the articles;
Neglecting foreign-document legalisation requirements.

Practical Share Transfer Checklist

Before completing a Turkish share transfer, the parties should ordinarily:

Identify the company type and nature of the shares.
Review the articles of association and shareholders’ agreement.
Confirm the seller’s ownership and authority.
Examine share certificates, the share ledger and MKK records.
Conduct legal, financial and tax due diligence.
Determine whether general assembly approval is required.
Review public debt and manager liability risks.
Check Competition Authority and sector-specific approval requirements.
Prepare the share purchase and disclosure documents.
Complete notarisation where required.
Perform closing against payment and document delivery.
Update corporate, registry, banking and regulatory records.

Conclusion

Share transfers in Turkey require different procedures depending on whether the target is a joint-stock or limited liability company. A joint-stock company transfer may often be completed through the transfer of the relevant share instrument and updating of corporate records. A limited company transfer generally requires a written agreement with notarised signatures and, unless otherwise provided, general assembly approval.

The formal transfer procedure is only one aspect of the transaction. The buyer must also investigate the company’s historical liabilities, public debts, employment exposure, contracts, litigation, assets and regulatory position. Competition approval or sector-specific permission may be necessary even where the corporate transfer documents are otherwise valid.

A carefully structured transaction should coordinate due diligence, the share purchase agreement, corporate approvals, tax planning and post-closing implementation. This approach reduces the risk of acquiring undisclosed liabilities or completing a transfer that cannot be effectively enforced.

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