When Turkish companies
are no longer profitable, the founders can consider a restructuring process
. This can include an operational and/or structural reorganization of the company
in order to reduce costs and maximize profits. The goal is to reduce the overall debt to creditors and save the business.
A number of laws in Turkey regulate the manner in which debtors are treated and how creditors can recover their assets. Company bankruptcy
and insolvency are regulated by law and these practices may need to be commenced by companies that can no longer restructure
The team of experts at our law firm in Turkey
is able to help you with company restructuring
and with all of the steps associated with insolvency and bankruptcy.
Company restructuring options
Certain cost cutting measures can be considered in order to help the company overcome financial difficulties
. Payroll cuts and even employee dismissals
can be taken into consideration as well as reducing the size of the company and selling assets.
The aim of the company restructuring process is to make all the necessary costs cuts and changes in order to be able to satisfy the claims of the creditors. Failure to do so may entitle the creditors to file for a mandatory company bankruptcy. During the restructuring process, the company stays functional.
The creditors must approve a company restructuring process and a general maximum time for this process is applicable in Turkey. If the creditor makes a court claim for restructuring then the competent court becomes a supervisory authority during the time of the restructuring.
Debt restructuring in Turkey
Debt restructuring in Turkey is negotiated between the company that has financial difficulties and the creditors. New contracts for financial support can be concluded during this stage with the purpose of rescheduling the payment options for the debtor company.
The legal entity undergoing a debt restructuring plan continues to engage in its regular trade activities but it will have to adjust its business plan in order to implement the new cost-effective changes.
Company owners in Turkey that agree to a debt restructuring plan can avoid the bankruptcy process. You can contact our lawyers in Turkey
to find out if debt restructuring can apply to your particular case and if it is an advantageous option.