Company Dissolution/Liquidation in Turkey

Types of companies that can be liquidated in Turkey

• private limited liability companies;
• joint stock companies;
• collective companies;
•  commandite companies;
• commandite companies with share capital
• cooperatives;
• foundations and associations undertaking commercial activities.

How can a company be closed in Turkey?

1. the company has reached its purposes and the shareholders no longer want to continue the business activities;
2. the company was established for a limited period of time which was prescribed in its Articles of Association;
3. the company shareholders consider that the company no longer represents their interests;
4. one or more claims have been filed by creditors with a Turkish court and the company is bankrupt.

• voluntary (as a result of the company’s general assembly decision);
• compulsory or mandatory (after the creditors have filed a petition with a court).

Steps for closing a company in Turkey

• The general meeting has the power to dismiss the liquidator and can decide the level of power he has in this process.
• In the situation of a compulsory liquidation, the Court must appoint the liquidator and has the power to dismiss it if necessary.
• The liquidator checks the documents and notifies the creditors regarding the liquidation process. Specific assets can be sold to pay the debts.
• After paying the company’s debt, the rest of the assets will be distributed to the shareholders.
• The last step is to convene a general meeting in which the termination of the liquidation procedure is announced.
• The decision is then registered at the Trade Register and the name of the company is permanently deleted from it.
• The liquidator is required to appoint a third party who must keep the company’s documents for at least 10 years.

What responsibilities does the liquidator have in winding up a company in Turkey?

• Analyzes the company's financial documents and can collaborate in this regard with an accountant.
• Reports the financial situation to the company's management.
• Assets are being sold to pay off debts. The liquidator ensures a fair process and that all procedures are prepared.
• The remaining assets are distributed in the company to the shareholders. The liquidator is in charge of such task.

Required documents for company liquidation process in Turkey

1.     the minutes of the shareholders’ meeting indicating the decision of winding-up the company;
2.     the declaration through which the liquidator who will handle the process is appointed;
3.     an inventory which shows all the assets of the company is also required;
4.     the balance sheet showing the company’s financial status must be prepared;
5.     a declaration of the shareholders through which the inventory and balance sheet are approved.