Is It Possible for Commercial Enterprise to Change its Legal Form to Joint Stock Company? 12 June 2018

Nowadays; most of the merchants prefer to enter commercial life by establishing commercial enterprises. Improvement of the merchant and his commercial enterprise arising in such commercial life encourages the merchant to transfer more institutional structuring and consequently, to establish a capital stock company. In such situations, merchants generally prefer to establish a new capital stock company. The reason for such preference is that most merchants are not aware of the possibility that the commercial enterprise can be converted to a capital stock company.

Although the most common legal form change transaction is the conversion of a capital stock company into another capital stock company; it is possible to change the legal form of a commercial enterprise into the joint stock company in recent conditions contrary to the abolished Turkish Commercial Code numbered 6762.

According to the Paragraph 2 of Article 194 of the Turkish Commercial Code numbered 6102 regulating that “In the event a commercial enterprise converts to a commercial company, Articles 182 to 193 shall apply comparably.”; a commercial enterprise can be easily converted to a joint stock company.

Within that respect; the advantage of preference the change of company type instead of establishing new one is that the previous company subject to the conversion continues exist pursuant to Article 180 of TCC. Such continuousness will demonstrate the advantage of continuing the commercial reputation of the commercial enterprise for many years. Additionally; there will not be any obligation to transfer the agreements whose party is commercial enterprise to the joint stock company that will established from nothing or to sign new agreements by this joint stock company. Therefore, these agreements that were already signed by the commercial enterprise will continue as is and this situation is also for the benefit of the merchant.

It is a sensitive issue to benefit from the taxational and legal advantages of a joint stock company that will arise as a result of the change of the legal form and to maintain commercial activities in an institutional structure. It is important that both species change transactions and the process after the change of species are conducted in consultation with expert lawyers.

Türkçe Versiyonu İçin

http://www.kasaroglu.av.tr/tr/ticari-isletmenin-anonim-sirkete-donusturulmesi

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