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Company Share Transfer in Turkey

Company Share Transfer in Turkey – Legal Process, Requirements, and Tax Implications

Transferring company shares in Turkey is a common process for restructuring ownership, attracting new investors, or selling an existing business. However, the procedure is subject to specific legal requirements under the Turkish Commercial Code (TCC) and other related legislation. This guide explains the types of share transfers, the legal process, and the tax obligations to help business owners, shareholders, and foreign investors navigate the process smoothly.

Table of Contents
Company Share Transfer in Turkey
Company Share Transfer in Turkey

Understanding Share Types in Turkish Companies

Before initiating a share transfer, it’s important to determine the type of company and share structure, as the procedure differs between Limited Liability Companies (LLC) and Joint Stock Companies (JSC).

  • Limited Liability Company (Limited Şirket)
    Shares are represented by “participation shares” (pay) rather than stock certificates. The transfer must be registered and notarized.

  • Joint Stock Company (Anonim Şirket)
    Shares may be represented by share certificates (registered or bearer). Transfer procedures are generally simpler, especially for bearer shares.

Legal Basis

The key legislation regulating company share transfers in Turkey includes:

A. Turkish Commercial Code (TCC) (No. 6102)

  • The main law governing commercial entities, including share transfer procedures.

  • Articles 480-610 cover joint-stock companies (A.Ş.).

  • Articles 573-640 regulate limited liability companies (Ltd. Şti.).

  • Defines share transfer restrictions, approval requirements, and shareholder rights.

B. Capital Markets Law (No. 6362)

  • Applies to publicly traded companies.

  • Regulates share transfers in stock market transactions.

  • Requires compliance with the Capital Markets Board (CMB) regulations.

C. Foreign Direct Investment Law (No. 4875)

  • Governs share transfers involving foreign investors.

  • Ensures equal treatment between local and foreign shareholders.

  • Some sectors (e.g., defense, banking) require government approval.

D. Tax Legislation

  • Stamp Duty Law (No. 488) – Applies a 0.948% stamp tax on share purchase agreements (capped).

  • Corporate Tax Law (No. 5520) – Capital gains from share sales may be taxed at 25%.

  • Withholding Tax (WHT) – May apply to foreign sellers (varies by tax treaties).

Company Share Transfer Process in Turkey
A. For Limited Liability Companies (LLC)

  1. Share Transfer Agreement

    • Must be in writing.

    • Signed before a Turkish notary.

    • Includes details such as transfer price, number of shares, and parties’ information.

  2. Approval by the General Assembly

    • Share transfers require approval by the majority of shareholders representing at least 50% of the capital unless otherwise stated in the Articles of Association.

  3. Registration with the Trade Registry

    • The approved share transfer must be registered at the relevant Trade Registry Office.

  4. Update of the Share Ledger

    • The company’s share ledger (pay defteri) must be updated to reflect the new ownership structure.

B. For Joint Stock Companies (JSC)

  1. Registered Shares

    • Transfer of registered shares must be endorsed and delivered to the transferee.

    • Certain cases may require Board of Directors’ approval.

  2. Bearer Shares

    • Transfer is completed by delivery of the physical certificate to the buyer.

    • Since 2021, bearer shares must be notified to the Central Registry Agency (CRA / MKK) for validity.

  3. Trade Registry Update

    • Registration is only mandatory if there is a change in the Articles of Association (e.g., capital structure).

Taxation of Share Transfers in Turkey

  • Value Added Tax (VAT): Share transfers are generally exempt from VAT.

  • Stamp Tax: Payable on the share transfer agreement at a rate of 0.948% of the transfer price.

  • Income Tax / Corporate Tax:

    • Individual shareholders may be liable for capital gains tax if the shares are sold within a specific holding period.

    • Corporate shareholders may benefit from exemptions if the shares have been held for at least two years.

Restrictions and Special Considerations

  • The Articles of Association may include pre-emption rights or transfer restrictions.

  • In certain regulated sectors (e.g., banking, energy, insurance), prior approval from the relevant authorities is mandatory.

  • Foreign shareholders must comply with foreign investment regulations and may need to notify the Ministry of Trade.

Required Documents for Share Transfer in Turkey

  • Notarized share transfer agreement

  • Updated Articles of Association (if amended)

  • General Assembly resolution (for LLCs)

  • Share ledger records

  • Tax identification numbers of the parties

  • Power of attorney (if represented by third parties)

How We Can Help with Share Transfer in Turkey

At A&M Consulting Co., we provide end-to-end assistance with company share transfers, including:

  • Drafting and notarization of share transfer agreements

  • Organizing General Assembly meetings

  • Trade Registry applications

  • Tax advisory and compliance services

  • Foreign investor support

With extensive experience serving multinational companies and foreign investors in Turkey, our team ensures your share transfer process is legally compliant, tax-efficient, and completed without delays.

Company share transfers in Turkey require careful attention to legal, tax, and procedural requirements. Whether you are buying, selling, or restructuring shares, professional guidance can help you avoid costly mistakes and ensure a smooth process.

Transferring company shares in Turkey involves navigating a series of legal, financial, and regulatory steps. Having a trusted advisor by your side ensures the process is completed smoothly, in full compliance with Turkish Commercial Code, and without unexpected delays.

A&M Consulting Co. is a well-established consultancy firm in Istanbul, registered and accredited with TURMOB and ISMMMO, and recognized for its commitment to excellence and professional integrity.

Whether you are selling your shares, acquiring additional ownership, or restructuring your business, our experienced team offers comprehensive Company Share Transfer services. We handle every stage of the process — from preparing and reviewing share transfer agreements, coordinating with notaries, and updating company records, to ensuring all legal filings are completed accurately and on time.

With years of expertise assisting both local entrepreneurs and global investors, A&M Consulting Co. provides cost-effective, reliable, and transparent solutions tailored to your business needs.

If you are planning a share transfer in Turkey, partner with us to ensure a seamless transaction and full compliance with all local regulations. Contact A&M Consulting Co. today to start the process with confidence.

 

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FAQs About Company Share Transfer in Turkey

A company share transfer is the process of transferring ownership rights of a company’s shares from one shareholder to another. It changes the legal ownership but does not dissolve or re-register the company.

Legal requirements vary depending on the company type. For Limited Liability Companies (LLC), share transfers must be notarized and registered with the Trade Registry via the MERSİS system. For Joint Stock Companies (JSC), transfers can be more flexible, but certain restrictions may apply.

Yes. Foreign shareholders can freely transfer their shares in Turkey, provided the process follows Turkish Commercial Code (TCC) rules and other relevant legislation.

Yes, for Limited Liability Companies the share transfer agreement must be notarized. For Joint Stock Companies, notarization is not always mandatory unless required by the articles of association.

If all documents are ready, a share transfer can be completed within 3–7 business days depending on notary, Trade Registry, and MERSİS processing times.

Generally, stamp tax applies to share transfer agreements. In some cases, capital gains tax may apply to the seller. Foreign shareholders may also have tax implications in their home country.

Yes, with a Power of Attorney (POA) issued abroad and apostilled, the process can be carried out by a local representative without the shareholder being physically present in Turkey.

Generally, any legal or natural person can purchase shares. However, sector-specific restrictions (e.g., banking, energy, media) may apply.

Common documents include:

  • Share transfer agreement

  • Notarized company articles of association (if required)

  • Updated shareholder list

  • MERSİS application form

  • Power of Attorney (if applicable)

In Limited Liability Companies, the General Assembly must approve the transfer unless the Articles of Association allow otherwise. For Joint Stock Companies, approvals depend on company bylaws.

Once registered with the Trade Registry, the transfer is updated in the share ledger and MERSİS, making it legally binding and enforceable.

Company debts remain with the company, not the former shareholder. However, the new shareholder assumes ownership and responsibility for the company’s future operations.

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