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Legal Update: A Way for Foreign Investors to Lose Their Share “Privileges” As Per Turkish Law

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Communique no. II-28.1 on the Principles of the Abolishment of Privileges on Voting and Privileges to be Represented on the Board of Directors (“Communique”) by the Capital Markets Board of Turkey (“Board”) was published in Official Gazette numbered 31004, dated January 10, 2020.

In the Communique published pursuant to the Article 28 of the Capital Markets Law no. 6362, the procedures and principles was regulated on the abolishment of privileges on voting and privileges to be represented on the board of directors in the publicly held joint stock companies which have made losses in previous five consecutive years according to the financial statements.

The privileges which are abolished by the decision of the Board, shall not be applicable after the date of such decision and the publicly held companies have to apply to the Board to make necessary amendments in their articles of association regarding such abolishment in two months after the notification of such decision. The articles of association amendments which are approved by the board have to be included in the first general assembly minutes of the companies.

You may find the Turkish version of the Communique on the link below.

https://www.resmigazete.gov.tr/eskiler/2020/01/20200110-5.htm

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