Liquidation of Joint Stock and Limited Liability Companies: Procedure, Time Limits and Liability

TTK art.529 lists the grounds for the dissolution of a joint stock company: expiry of the term, occurrence of a ground stipulated in the articles of association, declaration of bankruptcy, general assembly resolution, court judgment (TTK arts.530-531) and absence of organs. Article 636 contains parallel provisions for limited companies.

On dissolution, the company must add 'in liquidation' (tasfiye halinde) to its trade name. The board of directors continues in office but its powers are limited to the purposes of the liquidation; liquidators are appointed and registered (TTK arts.532 and 536).

The liquidator is responsible for conducting the liquidation, drawing up the opening and interim balance sheets, collecting receivables and paying debts, selling assets, and distributing any surplus to shareholders (TTK arts.540-543). The liquidator may be a natural or legal person; his or her civil and criminal liability follows the same principles as those for board members (TTK art.553).

Known creditors must be notified of the liquidation; for unknown creditors, three calls are published in the Turkish Trade Registry Gazette at weekly intervals (TTK art.541). Any remaining assets may not be distributed to shareholders before three months have elapsed from the third call to creditors (TTK art.543/2).

When the liquidation operations are completed, the liquidators draw up a closing balance sheet and present it to the general assembly. Upon approval and discharge by the general assembly, the company applies for striking off (terkin) from the trade registry; the company's legal personality ends with the striking off (TTK art.545).

If an omitted asset, receivable or proceeding later requires further liquidation, the persons listed in TTK m.547 may ask the commercial court at the company's seat to re-register it for those additional steps. Article 547 sets no general ten-year application period; time limits affecting the underlying right must be considered separately.

In corporate-law matters, resolutions, meeting notices, agendas, attendance lists, signature circulars, trade-registry application documents and the articles of association must be reviewed as a whole. In corporate transactions, most disputes arise not from the substance of the resolution but from defects in notice, quorum, representation and registration.

Transactions such as share transfers, amendments to the articles of association, mergers, demergers and liquidations are not completed by internal resolutions alone; notary, trade-registry, tax and accounting dimensions are also part of the process. The legal steps and financial obligations should therefore be planned together when drawing up the transaction timetable.

From the perspective of shareholders or directors, dissenting opinions, information rights, requests for special audit and records of release and liability may carry decisive evidentiary weight in any subsequent action. Minutes of meetings should therefore be prepared in clear and auditable form.