The Right of Pre-emption (Shufa) in Turkish Civil Law: Legal Principles and Application

The Right of Pre-emption According to Turkish Civil Law: Legal Framework and Application

The right of pre-emption (or right of first refusal) in Turkish Civil Law, particularly in co-ownership regimes, is a right that grants those who own a share in a property the priority right to purchase it when that property is sold. This right is a legal protection mechanism granted to co-owners of jointly owned real estate when they sell their shares to third parties. The right of pre-emption aims to protect the integrity of the property held by the co-owners, ensuring that they have priority as buyers in any transactions with third parties.

This article will examine the legal nature of the right of pre-emption as regulated in the Turkish Civil Code, the conditions for its exercise, its consequences, and examples of its application.

1. Legal Basis of the Right of Pre-emption

The right of pre-emption is regulated in Articles 732 to 734 of the Turkish Civil Code. These provisions determine when and how the right of pre-emption can be exercised. According to Article 732 of the Turkish Civil Code, if a co-owner of a jointly owned property sells their share to a third party, the other co-owners have the priority right to purchase that share under the same conditions. The right of pre-emption is established to prevent the division of the property and to ensure the continued joint use among the co-owners.

2. Types of Pre-emption Rights

In Turkish Civil Law, the right of pre-emption appears in two different forms: statutory pre-emption and contractual pre-emption.

2.1. Legal Right of Pre-emption
The legal right of pre-emption is the right held by co-owners of jointly owned real estate. When a co-owner sells their share in the property to a third party, the other co-owners may object to this sale and purchase the share in question with priority at the price paid to the third party. This right is a right arising from the law and is granted to protect the rights of the co-owners in the real estate.

2.2. Contractual Right of Pre-emption A
contractual right of pre-emption is a right granted by a contract between the parties. This right can arise in situations other than co-ownership. For example, when the owner of a property sells it to a third party, they may grant another person (e.g., a neighbor) a priority right to purchase it. This type of pre-emption right is established by mutual agreement of the parties and, if registered in the land registry, can be asserted against third parties.

3. Exercise of the Right of Pre-emption

The exercise of the right of pre-emption is subject to a specific legal process, and this process must be followed correctly. The following steps are taken to exercise the right of pre-emption:

3.1. Notification of Sale
When a shareholder sells their share to a third party, the sale must be notified to the other shareholders. This notification is made through a notary public. This notification is important for the other shareholders to be able to exercise their right of pre-emption. If notification is not given, the right of pre-emption remains valid and the statute of limitations does not begin.

3.2. Pre-emption Lawsuit
A co-owner wishing to exercise their right of pre-emption must file a pre-emption lawsuit within 3 months of being notified of the sale and in any case no later than 2 years after the sale. This lawsuit is filed in the civil court of first instance in the location where the property is situated. A pre-emption lawsuit ensures the return of the sold share.

3.3. Payment of the Sale Price
When exercising the right of pre-emption, the sale price must be paid to the third party. The co-owner acquires their share in the property by paying the sale price. However, it should be carefully examined whether the sale price is actually the price stated in the sale, and to avoid any doubt, an accurate determination of the price may be requested during the lawsuit.

4. Situations in Which the Right of Pre-emption Cannot Be Exercised

There are also situations where the right of pre-emption cannot be exercised or is limited. These are:

– Relationship Status: If a share of a jointly owned property is sold to a relative of another co-owner, the right of pre-emption cannot be exercised. According to Article 732 of the Turkish Civil Code, the right of pre-emption does not arise if the sale is made to first-degree relatives.

– Transfers by Donation or Inheritance: In cases where the immovable property is transferred by inheritance or by donation, the right of pre-emption cannot be exercised. This is because, in these situations, there is no sale involved, and therefore the right of pre-emption does not arise.

– Waiver of Pre-emption Right: A co-owner may waive their pre-emption right. This waiver is made through a written declaration of intent by the co-owner and, if registered in the land registry, can be asserted against third parties.

5. Legal Consequences and Significance of the Right of Pre-emption

The right of pre-emption contributes to the preservation of the integrity of real estate among co-owners. This right strengthens the co-owners' control over the property while acting as a safeguard limiting interference by third parties. The right of pre-emption has the following legal consequences:

– Ensures Equality Among Stakeholders: The right of pre-emption protects the rights of shareholders in the property and prevents other shareholders from being harmed if the property is sold to third parties.

– Prevents Property Division: To prevent disputes and the division of the property among co-owners, the right of pre-emption comes into play, ensuring that the property remains among the co-owners.

– Protects the Rights of Stakeholders: The right of pre-emption makes it difficult for a shareholder to sell the property, while giving other shareholders the opportunity to object to the sale and to consolidate their shares in the property.

6. Conclusion

The right of pre-emption is an important right granted to co-owners of jointly owned real estate under Turkish Civil Law. This right regulates transactions between co-owners regarding the property and prevents them from being harmed in sales to third parties. To exercise the right of pre-emption, a lawsuit must be filed within the legal time limits and the sale price must be paid. The right of pre-emption is an important protection mechanism that preserves the integrity of the real estate and ensures equality and justice among co-owners.